Why is there so much paperwork to sign to get a mortgage?

By
Real Estate Agent with Home Smart Realty Advisors RS332266
http://activerain.com/droplet/4YdQ

There are two good reasons why the loan process has become "hair pulling" for today's buyer than perhaps any time in history.

1. The government has set new guidelines that now demand that the bank prove beyond any doubt that you are indeed capable of affording the mortgage. This obviously avoids the fraud that was once a part of the mortgage industry that led to the housing market crash.

2. The banks don't want to be in the real estate business. Over the past several years, banks were forced to take on the responsibility of liquidating millions of foreclosures and also negotiating another million plus short sales. Just like the government, they don't want more foreclosures. For that reason, they need to double check everything on the application.

The good news is that since the housing crash the interest rate is very low as compared to before the crash.  Instead of concentrating on the additional paperwork required, let's be thankful that we are able to buy a home at historically low rates.

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Topic:
Home Buying
Tags:
realtor
real estate agent
mortgages
buying a home
interest rate
paperwork
banks
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new guidelines
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Rainmaker
1,424,355
Sandy Padula and Norm Padula, JD, GRI
Realty National - Carlsbad, CA
Presence, Persistence & Perseverance

Deborah Spence Very true and I liken the mortgage financing process to being backed into a corner by a mugger. With every document signed by the borrower, there are fewer exits.

Dec 20, 2016 06:04 AM #1
Rainmaker
3,522,733
Joan Cox
Metro Brokers - House to Home, Inc. - Denver Real Estate - 720-231-6373 - Denver, CO
Denver Real Estate - Selling One Home at a Time

Deborah, great post explaining to borrowers the reason banks/lenders want everything to do with your credit.

Dec 20, 2016 07:00 AM #2
Rainmaker
1,175,005
Kat Palmiotti
Grand Lux Realty, 914-419-0270, kat@thehousekat.com - Monroe, NY
The House Kat

There are definitely reasons for all the requests for information!

Dec 20, 2016 07:47 AM #3
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Rainmaker
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Deborah Spence

Awesome Realtor serving Philadelphia and suburbs!
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