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Steve Abitbol
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AZ: For Lenders. Help and recommendation needed plz!

Steve Abitbol
Posted Feb 21 2020, 20:21

Hello BiggerPocket world,

I am going to dig right in.

I am currently in the process of refinancing a home that I own in Phoenix/Arcadia area. I have owned the home for little over a year, and currently have a VA loan (5% interest on loan) on the property.

I started the refinance process back in December, my goal was to do a cash out refi and use the capital for of course more properties.

I initially valued my property myself at 540k. Before the appraisal came back from the VA, the underwriter approved my loan with a few minor conditions, some were to pay off some personal debt out of the escrow funds coming back to me. (loan was set for 540k @ 5.5% because apparently doing a 100%LTV you pay a "premium" interest rate as they called it) This was after weeks and weeks of sending in my personal docs, w2's, bank statements, pay stubs, tax information, the whole nine yards.

The appraisal came back short (477k. As you can tell I lack major skills at reading comps) Due to the loan being a lot smaller number, it isn't considered a jumbo loan by the VA so my refi rate dropped from 5.5% with the original loan of 540k to now 477k @ 4.875% with 0 points.

I have a POA in line because most of my work is over seas. The lender got the escrow company to contact my POA without my consent, and without me reviewing any sort of a closing document to make sure everything looked good on the loan. (red flag number 1)

Once I requested for a closing statement or doc to review, there was no interest rate printed on it, no estimate of mortgage payment, the closing cost were a bit higher then originally agreed, and they had the wrong pay off amount there. I also took the initiative and paid off all of the debt on my credit (roughly 9k) out of my own pocket prior of closing so I also asked them to remove the debt from the statements, which they also never did. I kindly wrote them an email explaining my POA is not going to waste her time if I am not presented with a clear and concise closing document with the exact same figures she will at signing. (logic right?)

Second thing is, I started doing little more research and really believe that my property was very much under valued by the VA's appraisal, so I looked at comps closer (became more realistic this time) and wrote up a ROV (Reconsideration of Value) explaining my property should at least be worth in the 485-499k range and why.

The lender then tells me "Sorry that isn't an option, loan is clear to close"


He is refusing to pull my loan out of underwriting and help me challenge the VA with an ROV. Is this even legal? I understand that he just wants to close the loan and move on to the next, but where is the customer service here? Everything I have said has been a NO. So finally he comes back and says "Well your DTI (Debt to Income) ratio will be off and you will not qualify or get approved for a higher amount. My DTI ratio is around 24% and va's guideline is generally 41% and have seen it up to 60% on some cases. (red flag number 2)


I also wrote him back with a snapshot of the email he has sent me few weeks back in writing stating "Congratulations your 540k loan is approved with these following conditions…" He then comes back and says wow you are right, I am sorry; but still we cannot challenge the NOV (notice of value) then repeated to me "loan is clear to close and ready for signature"

Is this even legal? Besides the lack of obvious customer service, I am not getting the proper representation at all from these people.

What do you guys recommend I do in my scenario? I also feel like a 4.8% rate is huge, 100LTV or not.


Sorry for the lengthy thread, hope to get some insight from some other professionals on here.

thank you!

Cheers.