Mortgage Business

My Buyer Needs to Settle in 2 Weeks

Sorry!  Probably isn’t going to happen – not right now.  We’re in June.  Remember all those sales in April to first time home buyers that need to settle by June 30th or they “lose” $8,000?  Those are the mortgage loans getting priority in the processing and underwriting queues around the country.

Unfortunately, as hard as I might try, your client’s application is going to get pushed behind the all important first time buyer’s application that still hasn’t settled.  Things are so busy that at least one national mortgage lender has set this Friday – June 11th – as the deadline for getting all final conditions into processing in order to close a “tax credit mortgage” by June 30th.

Even if you and your client get me everything today (which you won’t), the application file won’t get to my processor until Monday (after overnight shipping and 24-48 hours of “quality control” audits).  Then we have to deal with a 7 business day underwriting queue.  If everything goes perfectly, I could have the mortgage commitment in 2 weeks . . . if everything goes perfectly.

Unfortunately, nothing ever goes that well.  Did I say that the borrower’s a resident aliens and own a commercial building for rental, as well as, a single family home rental?  Did I mention that their son is acting as the intermediary in every communication?  Oh, and the property they are buying is a condo unit in a resort market and they are buying it as a 2nd home when the listing highlights how much rental income the unit produces during the summer season – remember these folks have a history of acting as real estate investors.

None of this is problematic from the point of view of getting the loan approved and settled in an orderly manner.  Just not in 2 weeks!

Just because a title attorney’s office says they can “get title” in 2 weeks, it doesn’t mean that the appraisal, the condo review, the underwriting review, and everything else involved in getting a loan to closing can happen that quickly.  Let’s not forget about all the new RESPA, HERA, HEOPA, and HVCC disclosure and timing requirements that we have to comply with.

So, enough said.  Let’s please try and set proper expectations for our clients.  If they wanted to be in the summer condo by June 22nd, then they should have signed the purchase agreement at least 2 weeks ago, or purchased with cash.

The sad part is that this agent will probably tell the borrower to find a lender that will say they can get the loan closed in less than 2 weeks.  Then I’ll get the call a couple of weeks later to come in and get the borrower or the condo project approved:  “Jeff, you know my guys that you approved but said you couldn’t get to settlement in 2 weeks?  Well, the lender I put them with – they are ready to go, but – Fannie Mae won’t approve the condo . . .” Yaada, Yaada, Yaada

I know you want to get to settlement but let’s all do a better job of understanding the details of each transaction and setting the right expectations with everyone involved.  Thanks.

If you need a lender in the Delaware or Maryland beach resort area, please contact me.  I’ll be happy to help in an upfront and straightforward way.

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Jeff Baxter – Prosperity Mortgage – Bethany & Rehoboth Beach, DE

My Website – Email:  jeff.baxter@prosperitymortgage.com

 

 

 

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