My Mortgage Application was.....DECLINED! :(

By
Real Estate Sales Representative with Robert W May - Lethbridge Real Estate

As a mortgage associate in Lethbridge with Canada First Mortgage, as well as being a licensed Realtor and Broker of Rainbow Realty, I have been an active fixture of the local real estate community since 1993.  I have helped many others obtain mortgages, home equity line of credits, consolidation loans, and even second mortgages.  Many of these clients were a bit of a challenge, having poor credit or non-traditional jobs or income streams, so imagine my suprise when I submit my own personal application for financing on a property and am declined by the lender.

Now let me start by saying that I am self-employed, have strong credit, and no debt.  On paper I appear to be a strong applicant.  However, sometime in the recent past during the mortgage and lending crisis which we are enjoying, my favorite lender decided to change their policies.  The new policy now requires that all properties that they lend on be listed MLS.  That means that no private transactions, no exclusive listings, no FSBO, etc.  This is great news for organized real estate and may put a single nail into the coffin of the fsbo companies, but for me it was devastating.

I contacted my lender and stated that if they would like, the property I was buying could be listed MLS within 5 minutes, however they have another curious policy which states that every mortgage submission gets one chance, and once chance only.  So my file was declined and would not be reconsidered.  Totally absurd logic, but those are the rules which I am bound to follow.

The good news was that there is a whole host of other lenders who do not as of yet have similar bizaar policy and my application was able to be resurrected and redirected to a different lender.  Financing approved, funds advanced, mortgage completed, all withing a weeks times. 

 

For future mortgage applicants, it is of great importance that you work with a mortgage associate who has this sort of flexibilty available to them.  It is important to have access to multiple lenders, multiple products, and to have as many options available as possible.  This personal experience has reinforced to me to keep my streams of communication with ALL lenders open and active.  It reiterates to me the importance of knowing which lenders offer which type of products to keep abreast of where to direct each unique application.  It is the reason that I continue to meet with various lenders weekly, track their products daily, and remain an active member of the industry.

 

Robert May

 

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Robert May is the broker and owner of Rainbow Realty of Lethbridge Alberta. He is also a licensed mortgage associate and financing expert with Canada First Mortgage of Calgary Alberta. He has been in the real estate industry since 1993 and offers full MLS real estate services to Lethbridge and surrounding area, as well as mortgage financing, refinancing/renewals, preapprovals, and home equity financing to Lethbridge and Southern Alberta. He can be found online at www.LethbridgeLoans.com



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Robert W May is a Real Estate Broker in Lethbridge Alberta, having now been in the industry for over 23 years. . He was also a licensed Lethbridge mortgage broker and financing expert with Canada First Mortgage of Calgary Alberta for the past 10 years.  He is an industry leader always willing to help train and educate others in how to improve their business models for financial and personal benefit.




 

 

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Rainer
179,681
Erik Hitzelberger
RE/MAX Alliance - Louisville REALTOR-Luxury Homes - Louisville, KY
Louisville - Middletown Real Estate

Robert - I haven't heard of any lender with those policies.  I wonder what events triggered this sort of reactionary overkill. 

Dec 03, 2008 03:27 PM #1
Rainer
18,506
Pete Stanley
Coldwell Banker Residential, Prescott AZ. - Prescott Valley, AZ
TEAM STANLEY, PRESCOTT, ARIZONA

Nice story and it is being played out all over.  When I bought a foreclosure two years ago I did it with "Stated Income" since I am a Realtor and subject to income cycles.  The bad news is I would not be able to buy the home I now live in because the rules have changed and Stated Income has gone away even though I can show a income tax filing that easily justifies the income for the loan.

A sign of the times for sure and I think it will get worse.  I am now fighting to get homes for two clients with good income and cash reserves but they cannot get a loan because of some glitches in their credit from several years ago.

 

Dec 03, 2008 03:29 PM #2
Rainmaker
532,644
Robert May
Robert W May - Lethbridge Real Estate - Lethbridge, AB
Real estate consulting

stated income is the bulk of my applications right now, fortunately i have a few lenders who still have low doc and no doc products available.

Dec 03, 2008 05:07 PM #3
Anonymous
max ray

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Dec 03, 2008 05:24 PM #4
Anonymous
max ray

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Dec 03, 2008 05:25 PM #5
Rainmaker
532,644
Robert May
Robert W May - Lethbridge Real Estate - Lethbridge, AB
Real estate consulting

Thanks, your most welcome max

Dec 07, 2008 05:21 PM #6
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Patrick Jeary

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May 26, 2010 08:53 PM #7
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