banker headache

i found a 100% loan through key bank and since we're trying to save every penny that we can for the new place we thought this option was perfect. well my banker has been telling me for a few weeks now that everything was fine and going smooth but yesterday (3 days before closing) he calls me and says we need an extension... when asked why he told me that there was a lock put on my loan that was approved 3 weeks ago and now the couldn't order the appraisal until the lock was lifted.

well i just try to keep telling myself that this is part of the process and dont get too down on the situation. we got our extension but the sellers are desprate to get out of this property and are getting a little worried. when i try to speak with anyone else with key bank i'm told i can use aoother banker if i want to start the whole process over again. :-(

any words of encouragement or advice out there for me?

:cry: :cry: :cry:

Edited: 06/26/2010 at 12:54PM

Don Konipol

Note Investor · Tempe, Arizona

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May 22 '10, 08:33 AM

Welcome to banking under the new socialist regime. All that matters now is that the bureaucrats that run the banks (now quasi governmental institutions) fill out all paperwork correctly and have no spelling mistakes. Last year I was refinancing a $500,000 mortgage on my personal residence. The interest rate was 6.25 % and I was refinancing with the same bank at an interest rate of 4.75%. Further I was bringing $100,000 to closing so that the new loan would be only $400,000. In addition I usually keep a seven figure amount on deposit at the same bank. Believe it or not, it took the bank 5 1/2 months to figure out how to fit me inside the new regulations and make the loan! Meanwhile, my gardner whom I sold one of my properties to had no problem getting a loan to purchase the property in about 20 days!

Edited: 06/26/2010 at 12:54PM

J Scott

Real Estate Investor · Atlanta, Georgia

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May 22 '10, 08:52 AM

Stay on top of your broker, and make sure you understand what is going on every step of the way...

Here is something to consider -- once the broker submits the loan to underwriting, the underwriter will take a look at all the documents and data and will come back with a list of additional things he needs to underwrite the loan. This list is called a stipulations sheet (or "stip sheet") and it will tell you exactly what's standing between you and your loan.

The underwriter may submit multiple stip sheets throughout the process, but at any point in time, you should be able to find out what's holding up your loan and do what it takes to move things along.

Until the stipulations on the stip sheet are all cleared, the loan is not approved.

In this case, I'd be concerned if you're three days before closing and the appraisal hasn't been ordered. Depending on how the appraisal is being done (is it through HVCC rules?), it could take up to a week to get the appraisal ordered, done, and back to the bank.

So, even if there weren't a "lock" on your loan, it's quite possible you wouldn't be able to close in three days.

Ask your broker flat-out what the stip sheet says, and that should give you an idea of what the hold-up is...

Edited: 06/26/2010 at 12:54PM

J Scott, Lish Properties, LLC
Telephone: 770-906-6358
Website: http://www.123flip.com
http://www.123flip.com

Josh Green

Banker · Tampa Area, Florida

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May 22 '10, 12:35 PM

Originally posted by Don Konipol

Welcome to banking under the new socialist regime. All that matters now is that the bureaucrats that run the banks (now quasi governmental institutions) fill out all paperwork correctly and have no spelling mistakes.

yawn...the name calling and finger pointing is getting old....

don, jscott has given some great advice. also, please remember that the guy you are working with at the bank is just a middleman. the underwriters are the ones that are picking the loan apart. ask them to be straight up with you and do so calmly.

i also find it strange that the appraisal still hasn't been completed.

Edited: 06/26/2010 at 12:54PM

JAMIE Doyle

· sandy, Oregon

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May 23 '10, 02:22 AM

well thats kind of my problem here josh...

i did tell him i needed him to be straight with me even if it's bad/no news, i just want to be informed.

a little more back story here... i was working with another guy @ key before this and he stalled me for 5 weeks on another property before saying "they said no" and "i'm quitting key bank" in the same sentence, he was actually fired by the way. all of his files got dropped on this guy who is the sales manager.

this guy is difficult to get ahold of and when you DO get him to respond he states "everything is going great and i'm in contact with the underwriter" and "everything is golden, all i have to do is order the appraisal". he has not once returned my re agents calls or emails when needing or sharing info on the transaction and she is telling me she's never worked with a banker like him.

i'm feeling "fed up" which i just keep telling myself that these things are normal for the "first time buyer" process... right? :-(

Edited: 06/26/2010 at 12:55PM

Jon Holdman

Real Estate Investor · Wheat Ridge, Colorado

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May 23 '10, 03:09 AM

No, this doesn't seem normal. But then 100% financing is unheard of right now, even for owner occupied. If the financing is real, you may just have to deal with the lack of response.

Edited: 06/26/2010 at 12:55PM

Jon Holdman, Flying Phoenix LLC

JAMIE Doyle

· sandy, Oregon

18 posts
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May 23 '10, 03:29 AM

well the financing is real, my buddy got his house late last year on same program. it's called the key community loan, it's a first time low to moderate income loan.

i just feel "stalled" right now.

Edited: 06/26/2010 at 12:55PM

Eddie Ziv

Real Estate Investor · Studio City, California

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May 23 '10, 04:18 AM

I had a very similar situation with WF couple of years ago. I was forced to request two extensions and in the end, I lost the property. (Which was sold two days later for a cash offer.. :cry: )
Sometimes the banks change underwriters after the loan has been approved by one and the new underwriter is more hard-**s.
However, if you are dealing with a mortgage broker as oppose to the bank directly, It could be some "rosy" info you are getting from the broker who's overly optimistic.

As Jon said. The first red light in this deal is the fact that the bank approved 100% loan. I think FHA require at least 5%, so let alone commercial bank.

Edited: 06/26/2010 at 12:55PM

JAMIE Doyle

· sandy, Oregon

18 posts
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May 23 '10, 04:34 AM

im sorry if i gave the impression i was working with a broker. i am dealing directly with the mortgage sales manager for key bank in my area. he is supposedly nemero uno for home loans in the area.

Edited: 06/26/2010 at 12:55PM

J Scott

Real Estate Investor · Atlanta, Georgia

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May 23 '10, 07:07 AM

Originally posted by JAMIE Doyle

im sorry if i gave the impression i was working with a broker. i am dealing directly with the mortgage sales manager for key bank in my area. he is supposedly nemero uno for home loans in the area.

Have you asked to see a copy of the stip sheet?

Edited: 06/26/2010 at 12:55PM

J Scott, Lish Properties, LLC
Telephone: 770-906-6358
Website: http://www.123flip.com
http://www.123flip.com

JAMIE Doyle

· sandy, Oregon

18 posts
50 influence

May 23 '10, 04:25 PM

am unaware of one existing... was told everything is golden and waiting to order the appraisal.

Edited: 06/26/2010 at 12:55PM

Bill Gulley

Real Estate Investor · Springfield, Missouri

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May 24 '10, 12:05 AM

Hi, this kind of thing has gone on for years, ever since I started in the business, so here I have to disagree with Don as much as we like to blame those up the food chain for our personbal misfortune. Your loan officer is probably swamped since he got all those loan files dumped on him. Make friends with the loan officer's assistant (they are the ones who know what's goin on and what has been done) By knowing the assistant well enough, you can call them and get the status and don't bother the loan officer. Tell the assistant you don't want to bother the L/O, you just need to know X...whatever.
If you need an extension don't freak here. You can extend almost any contract due to circumstances beyound your control, like lending and title requirements, and the banks know this when push comes to shove. In fact, it's usually included in the standard residential sale contract. You might tell your L/O that you need a committment letter for the seller since you're going to be out of contract. They will give you a letter and include the stipulations funding subject to, which will be a letter with little if any committment. But, it's something.....Bill

Edited: 06/26/2010 at 12:55PM

Ibrahim S

Real Estate Investor · Union, New Jersey

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May 25 '10, 06:31 AM

Hi Jamie. With all due respect, you still haven't answered J Scott's question. Have you asked for a copy of the stip sheet? The stip sheet may answer alot, if not all, of the questions you have regarding the status of your loan.

Edited: 06/26/2010 at 12:56PM