ARE HOME BUYERS BEATING THEMSELVES UP? We've all been there, working for months on a short sale or a transaction that is riddled with problems. It happens. There are some home purchases where there are some inherent problems. For instance a short sale, or a property that is not in "move in" condition. We KNOW we are going to earn our money on these.
By the time we get a troubled transaction to closing everyone is feeling beat up, the loan originator, the Realtors, buyers and sellers. It is a whole different market today compared to what it was a few years ago. In today's market the credit requirements are more stringent and the burden of proof stricter on the borrower. What I'd like to perfect is getting a few basic principals through to them.
1) Unless they are doing a construction or rehab loan, they MUST purchase a home that is in move in condition. To negotiate a contract on a train wreck of a home and expect not to get an armful of repairs from the appraiser is not realistic. When these surprises show up weeks into the transaction, it only spells trouble.
2) Provide everything asked for, all documentation, in a timely manner. Milking out the delivery of docs needed to process a home loan uses time that cannot be recouped.
3) When there are specific requests from the underwriter such as mechanics inspections, just do it! Don't provide some alternative to what is requested. To do so will cost valuable time. If you have time to spare, sure, you can ask about alternatives. Sometimes that works, but to ignore a specific request from the underwriter will result in you "feeling beat up".
4) Keep all your documents handy that you even "think" you may possibly need. Sometimes people pack up things to move including pay stubs, tax returns, bank statements, etc. I recommend anyone working on a home loan make a file and keep everything regarding income, assets and the home purchase in it until closing.
5) Don't deposit any money into your checking or savings accounts until you have made a photo copy of the check and keep a copy of the deposit slip. Any deposit other than regular payroll needs to be verified.
6) Go into the home loan transaction with the attitude that the bank is lending you a lot of money and they are going to take all the steps necessary to insure the collateral. Having a cooperative attitude when requests come to you will go a long way toward you not feeling beat up. It is a process. When short sales take months to work out, remember it was your choice to buy this home. Documents may expire, such as bank statements, pay stubs, credit reports, etc. You may need to produce additional information.
7) Don't write a contract to purchase unless you KNOW you have your ducks in a row.Taking time to get pre qualified may very well point up things you can do pre shopping that will save you bucks! After you have an accepted contract is not the time to figure out where you are getting down payment money.
In my 13 plus years originating home loans, I've seen about everything. It is my goal to get to closing with all parties to the transaction not feeling beat up by the process. After all these years and transactions I have some very set procedures I follow, yet it seems more than ever I run into these same situations. Often times home buyers are beating themselves up while the rest of us suffer along with them because after all it is our reputation on the line if the buyer is not happy in the end.
