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Hard time understanding the denial --- tunnel vision onto the debt to income ratio?

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Hard time understanding the denial --- tunnel vision onto the debt to income ratio?

I applied for refinancing with cash out to buy a new car on February 12th. I figured that it would save me about $500 per month. I provided the documents that the loan officer asked for. Then it was about to be denied due to the debt to income ratio. I then provided my investment and retirement account statements. The total of these accounts is four times of my new loan request. I would not pull money from my retirement account, knowing that it would penalize me for an early withdrawal.

My FICO score is 796, and other one shows 803. I routinely pay my credit card bill in full every month. I never let the balance be carried from month to month.

When my refinancing request was about to be denied solely due to the debt to income ratio, nothing else, in spite of the fact that it would save me $500 per month. My FICO score is sky high and my financial assets could easily pay the loan off. I have no car loan or any other loan, beside the mortgage.

The loan officer put it to be re-activated after I supplied my investment and retirement assets info. It was on March 19th. Second attempt to re-activate occurred on March 22nd then the recent attempt was made on March 28th. I asked for the status and did not received any update for two weeks. Then I pursued further by going to the local bank then made phone calls to two different bank contact persons. The loan officer apologized for not responding sooner. She informed me that I can reapply and the already-paid appraisal would be utilized. She did not indicate how soon the process would be completed. I asked that be expedited and I will be gone for the entire month of May. Why aren't they doing in the customers' best interest? 23 days are wasted based on inactivity after the initial denial. My requests for status update were ignored.

I have a hard time understanding why they did not see the WHOLE picture of my exceptional financial management. My concern is that I may lose my reservation deposit of $5,000 on the new car which is being built. Plus I will not be home for one month, meaning that I may keep on checking on the loan process while I am traveling - which can create some hassles when it is ready for closing. May 12th is the last day of the 90 days lock on the interest rate. Given 23 days wasted on inactivity, will the lock be extended?

Is it possible to have it expedited? I wonder why my requests were ignored until I made phone calls to her manager only to be asked to re-apply.
Not happy with the service I am experiencing. Can some credit be given due to their fiasco? What recourse do I have?

It is Bank of America Home Mortgage.
Message 1 of 3
Valued Contributor

Re: Hard time understanding the denial --- tunnel vision onto the debt to income ratio?

What was your debt to income ratio, did they say?

I dont know if showing you have large reserves usually makes much diffference...if you are over their debt to limit threshold, then it usually gets denied.
Message 2 of 3

Re: Hard time understanding the denial --- tunnel vision onto the debt to income ratio?

It's not you. It's BOA. They have one of the worst systems to try to get a mortgage or refi (along with Wells Fargo).

If time is a factor for you, make application with another lender - use a mortgage banker/mortgage broker that funds their own loans. You will get a better rate (usually) and much better service.


As a note, does BOA have your current mortgage? Is the rate the same or higher? If so, there is no incentive for them to refi you into a lower rate loan. Besides their general incompetence for originating loans, they are especially reluctant to process a refi that will reduce the rate. I am harsh about this because BOA has become so poorly organized that your experience is the norm now rather than the exception. (I'm a Realtor, not a LO, but I see BOA and Wells have difficulty originating loans regularly)

Message 3 of 3