Lender changing down payment to 30% 3 days before clos
I'm under contract to buy a condo in Florida at 25% down. Closing on 6/30, in 3 days.
Lender called and told me I must put down 30%. Apparently the condo complex is more than 50% investor-owned, and Fannie will require the higher down payment.
I feel the lender is at fault because the condo docs were not requested when we got under contract initially, on 5/30. The lender requested the condo docs on 6/24, 6 days prior to closing.
I don't want to put the additional 5% down, and I am also outside my contingency period and would lose my earnest money deposit.
Ideas? Advice? Much appreciated!
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@Kevin Lisewski that does seem a little odd that your lender would order the condo questionnaire 6 days before closing. Typically that one one of the first things I do as a lender.
What I can tell you is that gathering condo questionniares, by laws, and budgets from management companies that facilitate the delivery of these documents is one of the biggest headaches I encounter. A lot of management companies take FOREVER to complete the questionnaire. Then once they do complete the questionnaire there are often mistakes. Many management companies will refuse to complete the standard Fannie questionnaires and instead will only send their company proprietary questionnaires. These questionnaires often do not answer the necessary questions. Other times the proprietary questionnaires will answer extra unnecessary questions which the underwriter never asked for, but if they are voluntarily disclosed, the underwriter often cannot pretend they dont see it. For example, One time I did a loan in condo complex near a very large automotive plant. Many of the condo owners worked at the auto plant. A month earlier the auto company announced that a lot of layoffs would be coming throughout the company. For some reason the gal at the management company added a note to the questionnaire stating "There are currently no delinquencies on monthly HOA fees however the impending layoffs could create future problems. I think half the owners might go late" She had no inside information and was purely speculating but when the management company is told that they are expecting a 50% HOA delinquency default rate the underwriters are going to ask questions. Ultimately we did the loan but that definitely created additional steps to get the loan close.
And heaven help you if there are inconsistencies with a budget. Trying to get to the person who can actually clarify budget questions can be a needle in a haystack.
The lender may or may not have dropped the ball. My humble opinion is that when a seller or seller's realtor is selling a condo, they should be providing the buyer and their lender with all necessary condo docs UP FRONT as part of the purchase contract and disclsoures. Why this isnt a customary practice baffles me. If the current owner and their realtor were proactive in providing you this information up front, your lender should have been able to tell you a 30% down payment was required up front when you were in contract negotiation. Before you give an earnest money deposit. Before you pay for an inspection. Before you pay for an appraisal.
Hopefully this doesnt kill the deal for you.