Profile picture for sandisimm

HELP.. Underwriting

I have had my file with underwriting for a while now. My L/O has told me fax this to me and we are good over and over again it seems that underwriting wants to find something else even after they said give me this last document and we are good. I feel they are just finding things everyday it never ends. I have extended my contract to close but Friday the extension ends and today the underwriter wanted something else after they said we were good to go. Still no clear to close and Friday is drawing near. Today my underwriter told me just fax me this last bank statement and we should be good to close Friday but he said that before. Help me understand why is underwriting doing this they know my extension ends Friday. Is it possible to get a clear to close on a FHA loan tomorrow and still close on Friday?
  • December 18 2013 - US
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Answers (6)

It is possible but tough. 

Did you talk to the manager or do a conference call with all parties as suggested by Aaron? 

Now is the time to be bold and get the answers you need. 
  • December 19 2013
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Profile picture for sandisimm
Thank you all for your great advise. As figured I was asked for another bank statement today and my loan officer said again thats all they need, well guess what still no clear to close and my extension to close ends tommarrow unless it is possible to close same day of clear to Close I dont have a chance.
  • December 19 2013
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Hello sandisimm,


I have spent the last year or so managing a purchase team.  Unfortunately these things happen.  I can assure you that at least for me personally, and everyone on my staff, we don't like having to go back to our clients anymore than you like being asked for stuff repeatedly. 


While it is possible that your LO might be beating around the bush, as Mr. Brumley accurately suggested, let's give he or she the benefit of the doubt and I will lay out exactly why this (could be) happening. The only thing I disagree with is who to speak with.  I'll give you my advice below. 


Even the best Loan Officer is not an underwriter.  We tend to deal in the information that we have at the time.  So, we'll go into your file, talk to a processor or underwriter, etc. and figure out what we still need.  We'll call you and apologetically say there's one more thing that we need, because that's what our understanding of the matter is.  


Again, as Mr. Brumley suggested, most of the time we have to come back to you it's for one of two reasons.  The first, and most common, is that the "last thing" we needed from you caused a bunch more questions from underwriting.  Bank statements are the worst for this, as we need to source any amount of money you've deposited, transferred, etc.  Each time we see a new bank statement while trying to source funds, we have to repeat the same process.  It can turn into a seemingly endless cycle of one more thing that we need to verify to receive the final loan approval. This is just one example of a "vicious cycle" type condition.  The second possibility is that someone keeps dropping the ball.  That could be your Loan Officer, your Loan Processor, the Underwriter or someone else "behind the scenes."  

The bottom line is that we basically need to approach every loan with a "guilty until proven innocent" standpoint.  This is the result of a few bad actors finding new ways to beat the system, which results in tighter guidelines.  It's messy to be sure, but rest assured that the most likely scenario is your LO is working as diligently as possible to get you to the closing table and feels terrible about the stress you're going through.  We are people too and many of us really invest in our clients.  I know it's probably little solace since you're the one in the toughest position.  


My best advice is to do a conference call with your Loan Officer, your agent, and the settlement agent at the title company to find out how far in advance they need "docs," or closing instructions, from your lender.  That will let you know if closing Friday is possible. You'll also have all the people on "your side" of the transaction in one spot, it will prevent excuses, etc. and allow you to hold your lender accountable. 


Hope this helps! 


Thanks,
Aaron

p.s. If you're getting ready to buy a house, leave your money where it is until you speak with your Loan Officer about how to properly document transfers, deposits, etc. 
  • December 19 2013
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Profile picture for shapiroamg
Depending on how long you have been in process, the lender may need more recent statements for the file to be considered up to date. Many times those statements will show out of ordinary deposits and such that may need further explanations.  It doesn't sound unreasonable considering the way the industry is, but you need, as others have said, to speak to your LO and get a full explanation for this so you can better understand. It seems as though the LO is not very thorough.
  • December 19 2013
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Yes it's possible.  Usually in situations like these one of two things are happening:

1) The loan officer is beating around the bush instead of asking you for everything needed at once (this can happen often with less epxerienced LO's who are afraid of losing clients by asking for to much at once)

2) Your file is right on the edge of qualifying, and everytime the underwriter gets one thing, they are finding another thing that they need.

If you just gave them a bank statement, they may tomorrow ask you for details about deposits on that bank statement.  You need to work with your loan officer and his/her manager to make sure that they are being proactive and asking you not only for what is being asked for today, but also ask the question "in your mind will this document trigger another condition? If so, what is it?" and then get that item as well.

Talk to the LO, talk to the manager, explain the urgency and the frustration, ask if they think any other items will come up, and you can likely work through this.  

  • December 18 2013
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Profile picture for GMerino
It's possible, call your loan officer find out what is going on and see if there could be rush for your closing documents.  I wish you well and hope you close on Friday!  Let us know.
  • December 18 2013
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