Can you believe it!?

By
Mortgage and Lending with Credit Werx, LLC.

I can't believe it... I mean, I know that it is true I am just mystified by it.

I don't understand why anyone would do something like this... I am talking about an underwriter at an ailing bank. The Bank is HomeComings Financial (ResCap) and I won't mention the individual because I do not want to be sued by her in case she comes across this post on the internet.

I have been working on a file for a little while now; This file has been wrought with complication. The borrower is very well qualified with a 757 mid credit score, 20% down payment, and an additional 30k assets in her checking account; very good borrower.

The problems that we ran into were with the seperation that she is going through. I needed to show that my client is not responsible for the mortgage payment on her marital residence or else the DTI would not work. It took more than 3 weeks to get the seperation agreement as issues were being worked out between the 2.

I obtained a copy of the executed and recorded seperation agreement to show that she is not responsible for those payments and I indicated that she will be retaining the residence in DU. the findings that DU spit out and the language on the seperation agreement was very specific.

The day before closing the underwriter called me up and told me that she will be needing a fully executed and recorded quitclaim deed. I did not understand the condition because everything was in order and I did not state that she will be relinquishing her vesting in the property; just that her husband is legally responsible for the mortgage payments on the property.

I argued this point for quite a while with her and it looked like I might lose the battle in the end. I got supplemental proof to show that we did not need anything additional. The underwriter on the file told me that she took the information that I provided for her to the underwriting management team and they said NO! that I need the recorded quit claim deed.

I had looked at all of the facts by this point and I knew that everything was in order. I knew that this deal should be signed off on and I considered cutting my ties with this bank. I called our rep who is amazing; She sat down with me and collected the facts.

She went to the underwriting managment team prepared to go to battle. She was planning on really busting their balls in order to get them to sign off on this file. She called me back shortly after and told me that she did not need to go to that extreme.

Apparently per my rep the underwriting management team actually told the underwriter to sign off on the condition the day before... Wow! Why would she lie... Actually risk killing the file just so as not to be proven wrong?... She blatantly lied to me and the only reason that I can possibly imagine is that she just did not want to be proven wrong.

Everything is all set, the file has been doc'd out, and I just went over the final HUD with my client. I tend to overestimate on third party fees because I don't want anyone being caught off guard at the closing table. I quoted her 38k originally and she has to bring roughly 35k to the table. She is happy, everyone else involved is happy (except maybe the underwriter) and that makes me happy!

Posted by

Christopher Ohlsen

37 Boynton Ave

(845) 243-5293 (Office)

(518) 565-0799 (Cell)

www.plattsburghmortgage.net

chris.ohlsen@guaranteedrate.com

 

 

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Rainer
19,780
Collette Lee
Tower Realty - Riverside, CA

WOW....talk about a non professional underwriter.  I mean what a headache.  You did the right thing and sounds like you have a great rep.  I mean the DU findings dont lie if they are put in properly and well it does sounds like she wanted to just save face, but it has been my past experience that the majority of all underwriters (not all of them, there are some great ones out there) like to play, for a better word..god with the files.  I think they like the power that they have...Well good thing it went smoothly and I am glad to hear it.  Keep up the good work and keep putting those underwriters in their place....LOL

Jun 12, 2008 06:07 AM #1
Rainer
2,963
alisa bracksmayer
camelot funding - Long Beach, NY

WOW. i have been hearing alot of horror stories about underwritters lately, but this one is very different. there is absolutely no reason this underwritter could give that would justify her behavior. i hope her boss gave her a stern reprimand, as she has further damaged thier reputation. as a side note feel free to visit my website & run a free quote of closing costs at no obligation. use promocode: alisa/ar

Jun 12, 2008 06:32 AM #2
Rainer
91,292
Jimmy McCall
JimmyMcCall.com - Cunningham, TN
The Ex-Mortgage Consultant

Christopher,  I can not believe someone would deliberately do this.  What did she have to gain?  To save face?  All she had to say was "Cool, sounds great, let's close."

Jun 12, 2008 06:33 AM #3
Rainmaker
76,374
Randall Schrader
Competitive Insurance of Dundee - Dundee, FL

Weird!  Question:  Did this woman sign the mortgage and note?  If she did, the judge can make the mortgage the husband's responsibility.  A quit claim deed will relinquish her rights to the property.  But, if she signed the docs agreeing to be responsible for the mortgages re-payment, how are you getting 100% around that?  If the soon to be ex is foreclosed upon and gets chapter 7 bankruptcy protection, SHE WILL BE RESPONSIBLE FOR THAT MORTGAGE, in my opinion.

Jun 12, 2008 06:41 AM #4
Rainmaker
81,535
Christopher Ohlsen
Credit Werx, LLC. - Malone, NY

This is turning out to be a pretty good discussion. I am going to respond to the first round of comments right now. I am looking forward to more comments. Vertical Lending Services actually brings up a good point. Let me explain;

Before I do though I would like to let you all know that this loan just closed and funded 17 minutes ago.

Tower Realty - The findings are the findings. I do understand the point that the underwriter was making I just did not agree with her and apparently neither did the underwriting managment team. Once she is given the green light from her managment it is out of her control so in this case she really was acting in an irreponsible manner.

alisa bracksmayer (my closing space) - I think that she was on the verge of being fired. She was not fired but after it came to light that she had straight out lied to me I tried calling her and I got sent to the general delivery mail box. I was sure that she was gone but when I tried again about 20 minutes later I got her VM so I know that she is still on staff. I am thinking that it was close...

Jimmy McCall~Clarksville's Mortgage Consultant (Legacy Mortgage Services, Inc. ~ Clarksville, Tennessee) - Yeah, Jimmy she could've been cool about it. It is not her money and ResCap is probably going to go under after June anyway if they don't raise that 6B. I can't imagine why this woman was so emotionally invested in killing this deal that she went to the length of lying to me.

Vertical Lending Services - You are correct of course. And to get into more specifics about this situation; there is a quit claim deed on file. The QC Deed is being held in escrow with the husbands attorney until her husband refinances "at a time practical to him" at which time he will take out additional funds in order to fund the "distributive award". The husband will not be foreclosed on. He has excellent credit, income, and plenty of assets. I know where you are coming from and what you are getting at but in this case it is not relevent. I know that the line that you are walking on this subject is the same line that this underwriting was walking. However, DU findings are DU findings; I wrote the loan properly so as to get around this issue, had legally binding documentation relinquishing her responsibility of the payments, and I know the situation and I applied some common sense to it in order to make a firm determination that neither of these people will default on either of these loans. We have had 1 default out of close to 500 loans originated out of this office in the last couple of years. We have a very good record and the paper that we write performs! That is why I am 100% comfortable with the closing that just took place a few moments ago.

Jun 12, 2008 07:02 AM #5
Rainer
4,086
Michael Carter
Barton City, MI

I always love a challenging loan and I have found that divorce scenarios are easily some of the most complicated. I like what you did here Chris. Although the borrower would be "named" in the foreclosure and ultimately a judgement would be filed in her name, the signed divorce decree or seperation agreement is enough to eliminate the responsibility for pmt in Fannie Mae's eyes. The way that I like to look at this scenario is to compare the "marital residence" to an investment property that she may own. In an investment property situation the borrower is not removed from the obligations just because they are pruchasing a new owner occupied residence. The reason that borrowers still qualify for the new home is because the rental income washes the debt on the investment property. In a divorce case it is very similar. The marital residence is still technically owned but not considered into the DTI because the husband is making the payment. The borrower should be educated on the fact that she is still technically responsible and therefore legally, can stay in contact with the bank to be sure that the payments are being made. If the borrower finds that the payments are not made( by the X ) they can start a process similar to a foreclosure and have the X removed form the property. Then the property would truly become an investment property. It is Fannie Mae's understanding and faith in the mortgage professional that allows these transactions to move forward. If we all continue to act like professionals, the ability to finance these situations will never go away. In my opinion we should all utilize these facts to hammer that point home. Good work Chris. It takes a true mortgage professional to work through a divorce case......and in my experience.......if the underwriter has been through a divorce........it is 10 times more difficult...lol

Jun 16, 2008 01:10 PM #6
Rainmaker
81,535
Christopher Ohlsen
Credit Werx, LLC. - Malone, NY

Travis - Good points and luckily we had a good team working on this file. The reason that this person did not have the Quit Claim Deed executed and recorded at the County Clerks office as the bank had advised needed to be done is because her excellent attorney's assistant explained to her that by doing so she will have no recourse if he decides never to refinance and just default on the loan payments to drag her credit through the mud. This way he is held accountable and as you said she can take measures in the event that he does not pay his responsibility to have him evicted and wash the payments on the marital residence by leasing or renting it to a tenant. She is going through a difficult situation but I am glad that we were at least able to help her get back on her feet to some degree by doing a difficult deal at a reasonable price within the alotted time frames. No need for us to hold her up any longer than the problems that she is already going through. There are professionals involved and measures in place to ensure full cooperation from her husband and plenty of recourse built into the agreement in the event that he does not fully cooperate up until the point in where it is a sealed deal. This was one big step for this person in moving on with her life... She now owns a home that she can call her own and actually has something to show for it in the end.

Jun 16, 2008 02:34 PM #7
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Rainmaker
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Christopher Ohlsen

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