LENDING IS VERY FRUSTRATING

Most days I don't like my job.  24 years in mortgage lending and some days I lean towards checking the want ads for a job. 

I've got a massive headache as we speak.  When we take a loan application, we need 30 days of the most recent pay stubs, 2 months bank statements, 2 years worth of W-2's and Federal tax returns with all schedules.  We send out verifications of employment and deposit, wait for a week or two to get them back, we ordered the appraisal that takes 2-3 weeks to get.  Then we get the file ready to submit to underwriting.  Guess what - the last bank statement we got is too old.  Pay stubs and bank statements can't be over 30 days old.  We call and request newer ones.  By the time we get those, something else is too old.  It's a vicious cycle. 

Or we get a new pay stub and the borrower isn't working 40 hours.  Why are his hours less?  Is his job in jeapordy?  There goes the red flag on income. 

It's no longer a question of how can help a borrower get into a home, it's what can we find to turn a borrower down.

If it's not the borrower income or assets that's the problem, it's the property.  They want 3 identical comparable sales of homes that have sold in the last 3 to 6 months in similar neighborhoods.  That can be a problem.  Around here, a home in the country on 15 acres, outside a small rural town for $350,000 will be a problem, as there aren't any comparable sales.  Houses in not-perfect condition are becoming a problem.  Repairs have to be done by closing, sellers don't have the money to do them, borrowers can't get the loan till they're done.

You request an item from a borrower to solve one problem, and it triggers more needed items.

NSF's on your bank statement can cause your loan to be denied.  An isolated bounced check is ok, but if it's a continual thing you may not get a loan.

Haven't had your job for 2 years?  Don't have 3 active credit accounts with a 12-24 month payment history?  Have miscellaneous undocumentable deposits on your bank statement?
Cash at home you want to use for a down payment?  Commissioned? Seasonal employment?  Self-employed?  Truck driver paid by the mile?

All these things will make getting a loan difficult.

Since I can remember, we got a verification of employment, a check stub and your W-2's for income, a verificaiton of deposit to show you had sufficient funds to close and see what your 2 month average balance was and prove you had cash to close. 

It's a different ball game out there folks.  Now we get W-2's, Federal Tax returns, every pay stub you ever get, each bank statement you get till closing, we get your tax transcripts from the IRS to see if your tax returns are faked, we get verification from the social security administration to make sure you didn't steal the social security number, we pull your employers name and address off the internet so we've checked the address and phone numbers to make sure it's not a bogus emloyer we're given, we call just before closing to see if you're still employed, ughhh.

When we do a loan, we need actual bank statements, but we usually get print-outs that don't show us account numbers or even the borrower's names. When we do get bank statements they say page 1 of 4 and we only get 2 pages. If it says 1 of 4 pages, we need 4.

Borrowers are getting frustrated with us, we're getting frustrated with our underwriters. Lending is just not fun any more.

I developed a booklet for my homebuyers that explain the 5 parts of a loan, what to do once you've applied for a loan, what NOT to do, and what to expect. 

If you're a home buyer and want to find out about the pain-in-the-behind homebuying process, shoot me an e-mail and I'll send you a copy.  It will help you understand the hell that is my life, known as mortgage lending.