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Answers (17)
- Dennis Curcio, "Dennis Curcio"
- Contributions:14
HUGD -
Just in case you don't get it - I am a lender and I do want business.
I do a great job for my clients, and I don't try to gouge them for an extra buck by misleading them about rates and costs.
I charge a flat fee for EVERY loan regardless of loan amount or the client's credit profile. I rebate excess YSP above my fixed orgination fee as a credit to my clients.
(BTW, the basis for this thread, the borrower shopping the lender because of the "get two months of bank statements without overdraft fees" is really the best advice. Possibly the borrower could find another lender that could find some underwriter to approve it as is for a price increase - probably 1/2 to 3/4 point. Depending on the loan amount this could be $30-$75/month - $900/year, and $27,0000 over 30 years. The same amount invested in an S&P index fund would result in approximatley $240,000. So, my advice is to wait two months and stick with the lender.)
Am I in business - absolutely. And I'm upfront about everything, including my identity and my desire for new business.
Unlike you, I do not hide behind an ANONYMOUS identity.
Just in case you don't get it - I am a lender and I do want business.
I do a great job for my clients, and I don't try to gouge them for an extra buck by misleading them about rates and costs.
I charge a flat fee for EVERY loan regardless of loan amount or the client's credit profile. I rebate excess YSP above my fixed orgination fee as a credit to my clients.
(BTW, the basis for this thread, the borrower shopping the lender because of the "get two months of bank statements without overdraft fees" is really the best advice. Possibly the borrower could find another lender that could find some underwriter to approve it as is for a price increase - probably 1/2 to 3/4 point. Depending on the loan amount this could be $30-$75/month - $900/year, and $27,0000 over 30 years. The same amount invested in an S&P index fund would result in approximatley $240,000. So, my advice is to wait two months and stick with the lender.)
Am I in business - absolutely. And I'm upfront about everything, including my identity and my desire for new business.
Unlike you, I do not hide behind an ANONYMOUS identity.
- Dennis Curcio, "Dennis Curcio"
- Contributions:14
Hey HUGD - Seems you are unwilling to post any information in your profile. So before you post another comment - how about disclosing who you are, etc. in your profile? Are you a Lender or just another anonymous ranter?
P.S. I warned all that my previous post would hit some buttons. Guess I got yours. Ha!
P.S. I warned all that my previous post would hit some buttons. Guess I got yours. Ha!
- Dennis Curcio, "Dennis Curcio"
- Contributions:14
I'll warn all up front that what I've written below will problably irritate more than a few - but here it is:
Owning a home is a privilege - not a right. Getting a home mortgage is a business transaction - again not a right. Consumers always want to blame the lenders (the basis of this thread) for not getting them an approved loan or the rate the consumer thinks they should have gotten.
People - get real.
Up until a few years ago I would tell my real estate agents and mortgage prospects that they should start woriking with me to build their loan application and file three months before they even start looking for a home.
Now, I tell them four to six months is needed. Frankly, I end up being a credit coach during this time, and work with my clients to change their credit attitudes and behavior so they can achive access to good credit. IMO it's better to teach and assist a current sub-prime credit client to become a prime credit consumer than to strangle them with a burdensome loan.
Unfortunately, consumers do amazingly stupid stuff that affects their credit. Such as not paying a credit card bill because of a disputed purchase. Or cashing their paychecks at a ripoff payday lending store. Or buying a giant big-screen TV on a retail credit account just before wanting to buy a home. And my favorite, a non-casino employee regularly cashing his paycheck at a casino and then depositing the remaining (if any) cash into his checking account. Duh!
Bottom line - access to credit is a privilege. Earn it and you'll be fine. But, please stop whining about what you think you're entitled to. It just isn't so.
Owning a home is a privilege - not a right. Getting a home mortgage is a business transaction - again not a right. Consumers always want to blame the lenders (the basis of this thread) for not getting them an approved loan or the rate the consumer thinks they should have gotten.
People - get real.
Up until a few years ago I would tell my real estate agents and mortgage prospects that they should start woriking with me to build their loan application and file three months before they even start looking for a home.
Now, I tell them four to six months is needed. Frankly, I end up being a credit coach during this time, and work with my clients to change their credit attitudes and behavior so they can achive access to good credit. IMO it's better to teach and assist a current sub-prime credit client to become a prime credit consumer than to strangle them with a burdensome loan.
Unfortunately, consumers do amazingly stupid stuff that affects their credit. Such as not paying a credit card bill because of a disputed purchase. Or cashing their paychecks at a ripoff payday lending store. Or buying a giant big-screen TV on a retail credit account just before wanting to buy a home. And my favorite, a non-casino employee regularly cashing his paycheck at a casino and then depositing the remaining (if any) cash into his checking account. Duh!
Bottom line - access to credit is a privilege. Earn it and you'll be fine. But, please stop whining about what you think you're entitled to. It just isn't so.
- Netizen
- Contributions:33
My experience in buying a home coincides with Dave's comment on the mitigating factors surrounding your dilemma. If the loan to value is good, your credit score is excellent, you show sufficient assets / reserves, not to mention you have a good down payment, and your other credit history is clean, yet the lender is dinging you on overdraft fees (after getting a reasonable explanation of what occurred) then I would seek a new lender. If all these factors are in your favor, then it's also entirely possible after the real estate meltdown that lenders are simply paranoid. Many lenders believe real estate is like a river boat headed toward the edge of Niagara Falls, and want to make sure your resources can cover another fall in real estate prices. Most mortgage lenders exhausted their reserves on foreclosures, short sales and loan modifications. If they don't get it right this time, game over.
- Netizen
- Contributions:33
I initially overlooked the stipulation by the lender that borrowers have 2 months of no draft fees. Now that I reread it, I'm thinking that's not at all unreasonable. If a borrower is experiencing hardship, current overdraft fees on a bank statement are a red flag. Asking for two months of "clean" statements is not at all too much to ask. If I were the lender, I would require 6 months of clean statements.
My initial reply was based on reading the question too fast and making the assumption that the lender was denying the borrower credit based on having overdraft fees in their history. Secondly, because my lender pays my overdrafts (even mortgage payments) when I'm careless and forget to make a transfer into my checking account, and charges a hefty $35 for each overdraft (even on Starbucks coffee purchases), I forgot that I have this privilege because I banked there for 30 years. They see my historical performance and know they will likely get their money. If I don't reimburse them even once, they will no longer pay overdraft checks. Banks do not pay overdraft checks ordinarily unless the account holder sets up overdraft protection. I don't have overdraft protection but my bank pays my overdrafted checks. I consider this an expensive privilege because I would rather the bank pay my PG&E bill or mortgage payment if I forget to make a transfer into my account to cover it. They know after 30 years that I will deposit the funds, so they pay it, and make $35 a pop (what a profitable racket).
I won't rail on overdraft fees further. Rereading the question, I don't think asking for two months of unvarnished bank statements is unreasonable. In fact, I think it shows that lenders haven't learned a thing. Let the good times roll.
- Dennis Curcio, "Dennis Curcio"
- Contributions:14
To Netizen - You can rail all you want about banks and overdraft fees (and that is a completely different topic), but you should remember that a borrower is asking the lender for a large sum of money based on the borrower's promise to pay over a long period of time (30 years), and provide in most cases a rather small down payment (5-10% is typical). Given how many borrower's have, and still are defaullting, you might consider it simply resaonable business sense to evaluate a prospective borrower's money management behavior.
- Netizen
- Contributions:33
Why would lenders penalize those willing to pay through the nose for the privilege of overdrafting their account? I could see if the checks were returned unpaid, but if the checks were all paid by the bank (and you deposited sufficient funds to cover them) then ask them "What is your PROBLEM?"! Overdraft fees are usurious convenience fees that have nothing to do with whether a check was paid. If someone writes ME a check, what do I care if they pay an overdraft fee? All I care about is the check was paid by the bank.
Checks the bank pays are not "in the mail" because an overdraft fee is levied -- they're paid in the full legal sense! Now if the checks were returned unpaid, then that's tantamount to writing "bad checks" and should raise red flags.
- Dennis Curcio, "Dennis Curcio"
- Contributions:14
Multiple overdraft fees are a red flag. Period. They indicate faulty money management. A single overdraft might be explainable for some rare circumstance - such as a lost or delayed deposit. Several overdrafts just won't fly.
Underwriting will always look for stable and perferred growing psitive cash balances in your checking and savings accounts. Recurring draw downs to cover expenses indicate that you are having cash flow issues.
Underwriting will always look for stable and perferred growing psitive cash balances in your checking and savings accounts. Recurring draw downs to cover expenses indicate that you are having cash flow issues.
- Rudi Hofmann, "LUXURY HOME LOANS CA"
- Contributions:7435
Every time I've run into this, I have my borrower write a letter of explanation which is included in the loan package, prior to submission.
Never has a loan of mine been denied because of this. Of course you need adequate reserves to clearly show funds were available elsewhere, and this was just something overlooked or an accounting error. .... Happy funding, Rudi
Never has a loan of mine been denied because of this. Of course you need adequate reserves to clearly show funds were available elsewhere, and this was just something overlooked or an accounting error. .... Happy funding, Rudi
- Jacqueline Kounkel, "Wells Fargo Banker"
- Contributions:114
Cudos to Martin who answered this best. If this is a rare occurence for you to have overdraft fees and it just happened at the worst possible time, ask if the underwriter would accept 6 mos of bank statements and a written explanation as to what happened to cause this rare circumstance.
If it happens often and you are having money management issues, it may not yet be time to buy.
If it happens often and you are having money management issues, it may not yet be time to buy.
- Martin Wareing, "Martin Wareing"
- Contributions:3772
voc,
The hurdle with overdraft fees reflecting on bank statements (regularly) is a red flag to a lender. Red Flags to lenders spell trouble. What overdraft fees mean is that there is a money management issue potentially. There are not many lenders willing to carte blanche a borrower who has money management issues. Just remember, they are very afraid ofjust about everything and will put the burden of being a great borrower on the borrower. Overdraft is simply the new word for NSF or bounced checks. That is a no no. Try to get a cleaner bank statement or 2 and it should help the cause. I wish you well.
The hurdle with overdraft fees reflecting on bank statements (regularly) is a red flag to a lender. Red Flags to lenders spell trouble. What overdraft fees mean is that there is a money management issue potentially. There are not many lenders willing to carte blanche a borrower who has money management issues. Just remember, they are very afraid ofjust about everything and will put the burden of being a great borrower on the borrower. Overdraft is simply the new word for NSF or bounced checks. That is a no no. Try to get a cleaner bank statement or 2 and it should help the cause. I wish you well.
- Hans J. Stone
- Contributions:41
This would be a lender/bank specific guideline. I've never had a loan not be approved solely on overdraft fee's.
The bigger question is why she provided you with a Pre Approval without verifying your bank statements, especially if she knew this was a qualifying factor for approval. Sounds like you had a Pre Qual not a Pre Approval.......these are very different.
The bigger question is why she provided you with a Pre Approval without verifying your bank statements, especially if she knew this was a qualifying factor for approval. Sounds like you had a Pre Qual not a Pre Approval.......these are very different.
- Clay Branch, "Georgia Loans"
- Contributions:7836
Ask your lender if she can use a Verification of Deposit, a VOD, in lieu of the statements.
- Tim Storm, "SoCal FHA VA Lender"
- Contributions:31
This would be case by case. I've closed FHA loans with overdraft fees showing on the bank statements, but with a solid explanation letter, along with other compensating factors - high FICO, reserves, time on the job, low debt to income ratios - or some combination of these compensating factors. If other things in the loan file are weak, then adding overdraft fees may push it over the edge.
- Dave Skow, "daveskow"
- Contributions:1105
loan to value
credit score
assets / reserves
other credit history
credit score
assets / reserves
other credit history
- voc131
- Contributions:2
Such as?
- Dave Skow, "daveskow"
- Contributions:1105
possibly ...much more would need to be known to answer this question
Is it true that we cant get approved for a loan because we have overdraft fees on our bank statement
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