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My $1 Million Mortgage Journey . . . Here We Go!

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youdontkillmoney
Valued Contributor

Re: My Mortgage Journey . . . Here We Go!

Revelate,

 

Speaking of calculus, I remember as an undergrad I spent quite a while on an integral calculation, and in the end....15 lines of computations later, all that work....amounted to an answer of just "1". How eloquent and beautiful was that!

 

Back to you reply, thank you for answering my question. Yes I had 5 inquires all within a 30 day period, but not within 14 but I won't sweat it as I can explain them away and don't have anu urgent credit needs after the mortgage. The first was Wells on 5/3 or so, but then after temprarily getting rejected by the underwriters there, I started appping to five others May 20 or so, so that explains the flurry at that time. In hindsight I should've waited and Well would've come through, or my lender specifically and went over the underwriter's head. But I was thinking I needed to get back in the game right away. I'm fine with the inquiries, I have 4 backup's now for $1M too in case Wells for some reason falls through again.

 

As for why Well's underwriting rejected, the use of retirement as Reserves was okay with them, they were just wondering why I did not have more liquid cash and they saw that as a risk, if we generated so much income where did it all go. I sent in an explanation letter explaining how we give our parents $2000 a month each ($1K for her side, $1K for my side), we pay for my inlaws health insurance $12K a year, we max out all of our retirement accounts, etc and some other expenses. I noted ALL of these expenses are volunatarily and we are under no obligation to do so and can stop anytime, or reduce. Wells underwriter rejected us because perhaps saw our spending as a risk, even based on the totality of All of our paperwork, W2, taxes, etc to get a full picture of our profile. Of course when we get a mortgage, we plan to cut expenses since the mortgage is #1 priority. So far we've had the luxury to help people, and still save enough for a $1M purch. price approval.

 

As for my offer, it's partly inexperience in the market, this is our first time buying a home, plus it's also my worry that West Hills is quite a distance from West Los Angeles so not too enthused about the drive for the wife or myself since for her it'll take at least 1.5 hours maybe so that is what is not making me too eager to buy this property and offering up to $875 max for this $945 asking (seller's counteroffer) price, though I only got up to $850 when the seller said to come back to them when we want to start offering at 900. I also justified (in my mind) the $855 offer since I think it needed $90K in upgrades since it was not updated since 2005 or 20 years when it was built, gut the carpet for hardwood floors, remodel kitchen, remodel bathrooms, new appliances, etc; that is about $90K worth of renov. and $945 (their counter) - $855 (my offer) = $90k. Also it's only been a few weeks since entering this market, so again we can keep looking. I also worry if I offer over 900 on this property, in the coming years that area may be worth south of 900, maybe in the 8 or even 7 range (if there is an economic downturn) and be underwater. Last, I'm really glad my Wells lender came through for me, I think he did it from his professional sense of "doing right by us" based on the totality of our file and fought for us, going over the underwriter's head, and not purely from a profit incentive. He had our/his client's interest in mind from my assessment of him.

Message 71 of 226
Revelate
Moderator Emeritus

Re: My Mortgage Journey . . . Here We Go!

If you seriously think there's going to be that substantial of an economic downturn then why are you purchasing at all now unless it's just line in the sand?  If we have that level of crisis where are interest rates going to go, and if you can save ~20% on your purchase price, well you of all people absolutely know that calculus as well or probably better than I do. Smiley Happy

 

What I was getting at with regards to the 2nd Wells UW, is I've never, ever heard of anyone complaining about assets that weren't disclosed as long as you were ponying up the required amounts.  Like my aborted refinance now HELOC I decided I didn't want to do the 5 x 2 (or 3 or 4 statements by the time this is done) and so just tossed the checking account and Fidelty statement and called it good but didn't include any of the secondary accounts.  Unless the cash flow was negative, it's not like you had an expensive addiction based on your financials and can't see why they'd care as any discretionary spending can be cut as your LOX clearly articulated.

 

Not to sidetrack this, but oh I long for the days of 15 step integrations: this one will go for multiple pages in something that I can do in 2 minutes with a conversion to polar coordinates but unfortunately that's part b) of the question, and as such I'm stuck in Cartesian for this.  Yeah the answer should come out the same so it sorta helps to know what the target is, but this is an exercise in sadism (OK, so it's sorting people into A's and B's admittedly) for the professor unless there's some Mathematica trickery for this which I'm going to look into next cuz, well, yeah.  

 

Similar to your recollection, a more elegant question to seperate the A's from the B's was my old Vector calc final where 2 hours and 45 minutes into a 3 hour exam I'm just finishing problem 3 of 4, and looking at 4 and about to cry and/or just walk out as it was worse than the last one, till I recognized it was problem 3 with an additional variable: see previous answer, evaluate dirt simple integral, done.  Now that professor gets serious props for a smart exam design in comparison to the current one heh.




        
Message 72 of 226
Anonymous
Not applicable

Re: My Mortgage Journey . . . Here We Go!

Maybe you should explain that to the seller. All those remodeling things and call it outdated! Make your final offer or wait, as you know best. Learn from HGTV Smiley Tongue Anyway, I am following this and Gratz on your success. Your brother is doing the Realtor stuff right? tell him look for a closer place that you mentioned above. Maybe you can list your lenders name at wells after the deal is complete so others can ask for him personally because he seems like he went above and beyond. Nice work and I look forward to seeing the result. 

Message 73 of 226
tacpoly
Established Contributor

Re: My $1 Million Mortgage Journey . . . Here We Go!

@Revelate Your final reminded me of my Number Theory final even if it was the complete opposite. I'd finished all the questions quickly save one and I sat there for 30 minutes but just couldn't get on, until with 10 minutes remaining inspiration finally came and I hurriedly wrote in my proof and turned in my pages, relieved. I also had an abstract algebra take home final assigned 3 days into the semester that was pretty brutal: that was an 11-page proof with very small writing.
Message 74 of 226
Revelate
Moderator Emeritus

Re: My $1 Million Mortgage Journey . . . Here We Go!


@tacpoly wrote:
@Revelate Your final reminded me of my Number Theory final even if it was the complete opposite. I'd finished all the questions quickly save one and I sat there for 30 minutes but just couldn't get on, until with 10 minutes remaining inspiration finally came and I hurriedly wrote in my proof and turned in my pages, relieved. I also had an abstract algebra take home final assigned 3 days into the semester that was pretty brutal: that was an 11-page proof with very small writing.

Better individual than I!  More OT but I'm not sure I could handle real mathematics without throwing things... thought worst case on the career change I could just teach math, then realized that would actually involve doing numerous proofs and figured my fallback would be either HS Chem or Physics instead haha.  Physics "proofs" are serious handwaving till you get into the rarefied land of theoretical physicists and I've yet to see one for Chemistry though I'm sure they'll be there come Quantum or worse.




        
Message 75 of 226
youdontkillmoney
Valued Contributor

Re: My Mortgage Journey . . . Here We Go!


@Revelate wrote:

If you seriously think there's going to be that substantial of an economic downturn then why are you purchasing at all now unless it's just line in the sand?  If we have that level of crisis where are interest rates going to go, and if you can save ~20% on your purchase price, well you of all people absolutely know that calculus as well or probably better than I do. Smiley Happy

 

What I was getting at with regards to the 2nd Wells UW, is I've never, ever heard of anyone complaining about assets that weren't disclosed as long as you were ponying up the required amounts.  Like my aborted refinance now HELOC I decided I didn't want to do the 5 x 2 (or 3 or 4 statements by the time this is done) and so just tossed the checking account and Fidelty statement and called it good but didn't include any of the secondary accounts.  Unless the cash flow was negative, it's not like you had an expensive addiction based on your financials and can't see why they'd care as any discretionary spending can be cut as your LOX clearly articulated.

 

Not to sidetrack this, but oh I long for the days of 15 step integrations: this one will go for multiple pages in something that I can do in 2 minutes with a conversion to polar coordinates but unfortunately that's part b) of the question, and as such I'm stuck in Cartesian for this.  Yeah the answer should come out the same so it sorta helps to know what the target is, but this is an exercise in sadism (OK, so it's sorting people into A's and B's admittedly) for the professor unless there's some Mathematica trickery for this which I'm going to look into next cuz, well, yeah.  

 

Similar to your recollection, a more elegant question to seperate the A's from the B's was my old Vector calc final where 2 hours and 45 minutes into a 3 hour exam I'm just finishing problem 3 of 4, and looking at 4 and about to cry and/or just walk out as it was worse than the last one, till I recognized it was problem 3 with an additional variable: see previous answer, evaluate dirt simple integral, done.  Now that professor gets serious props for a smart exam design in comparison to the current one heh.


^^^^

No not likely we'll see a sever downturn in the next year but my valuation of the home at $875K is just what I feel I am willing to offer "right now" until I get a better feel for the market. 

 

As for Wells, that is what my lender went over the 2nd underwriter's head to the underwriter's boss (since what we do with our money is our business and all the other financials they review supported our $1M loan), and after that level of review, Wells approved my $1M purc. price mortgage. Again kudos to my Wells lender who did all of that without me asking, he surprised me by calling me back a about a week later.

Message 76 of 226
youdontkillmoney
Valued Contributor

Re: My Mortgage Journey . . . Here We Go!


@Anonymous wrote:

Maybe you should explain that to the seller. All those remodeling things and call it outdated! Make your final offer or wait, as you know best. Learn from HGTV Smiley Tongue Anyway, I am following this and Gratz on your success. Your brother is doing the Realtor stuff right? tell him look for a closer place that you mentioned above. Maybe you can list your lenders name at wells after the deal is complete so others can ask for him personally because he seems like he went above and beyond. Nice work and I look forward to seeing the result. 


^^^^^^

We did list out in detail each renov item needed, they replied as you read, just new appliances is needed. 

Yes my brother is a broker and representing us; he signed us up for real estate listing services w/ parameters such as cities we want, prices, # bed/bath rooms, etc so we get those listing emailed to us when they come on the market. The homes close to wife's work have not been coming in (west L.A.) since they are priced over $1.2 million and our max. is $1M. It's a waiting game for the market to cool down around here.

 

Yes I am sure my Wells lender does not mind providing his contact info, in fact he is located in Northern CA and I am in Southern CA, but location does not matter since we commnicate via email mostly, and phone if needed. I've never met him actually. But my brother referred me to him since a couple of years ago my brother refinanced and my brother said he was "honest and knowledgeable." My brother did not go with him because a mortgage broker quoted a lower rate, but in the end the rate the mortgage broker promised ended up being higher, so in the end my brother regretted not going with my Wells lender due to the lure of lower interest rates.

Message 77 of 226
youdontkillmoney
Valued Contributor

Re: My Mortgage Journey . . . Here We Go!

5/30/16 (10:35AM): Regarding the home we were negotiating on for a bit, the seller's agent contacted my broker with:

 

"How is going with your family?"

 

Presumably the seller did not get any good offers this weekend and following up. 

 

I advised my agent to respond with:

 

"Our family continues to be in the market for homes up to their $1 million "underwritten" credit approval. Thanks for keeping us in mind."

 

The "sport fishing" game continues, but I wonder who's the fish and who's the fisherman and who will tire out first. Plus the fisherman may have several poles in the water and another catch may come first.

 

Message 78 of 226
Revelate
Moderator Emeritus

Re: My Mortgage Journey . . . Here We Go!


@youdontkillmoney wrote:

5/30/16 (10:35AM): Regarding the home we were negotiating on for a bit, the seller's agent contacted my broker with:

 

"How is going with your family?"

 

Presumably the seller did not get any good offers this weekend and following up. 

 

I advised my agent to respond with:

 

"Our family continues to be in the market for homes up to their $1 million "underwritten" credit approval. Thanks for keeping us in mind."

 

The "sport fishing" game continues, but I wonder who's the fish and who's the fisherman and who will tire out first. Plus the fisherman may have several poles in the water and another catch may come first.

 


Out of curiosity what did your RE think of your offer?  I may have missed it in the run of things; there's always some shock offers when something first gets listed but if they're still talking they haven't flushed you entirely yet whereas if they thought it was utterly and absurdly lowball, they would've walked presumably.  Just starting the summer selling season, what'd you get from the walkthrough, kids or no, and why they were moving?




        
Message 79 of 226
youdontkillmoney
Valued Contributor

Re: My Mortgage Journey . . . Here We Go!


@Revelate wrote:

Out of curiosity what did your RE think of your offer?  I may have missed it in the run of things; there's always some shock offers when something first gets listed but if they're still talking they haven't flushed you entirely yet whereas if they thought it was utterly and absurdly lowball, they would've walked presumably.  Just starting the summer selling season, what'd you get from the walkthrough, kids or no, and why they were moving?


^^^^^

My RE himself thinks in the mid to higher 800's would be reasonable in light of the renovations needed. The last time the house was sold was in 2001 for $500,000.

As for walkthrough, the reason I seem to always get is the owners' kids have grown up so they are downsizing. We don't have any kids and in the walk through one aspect we didn'nt like but we could live with is the walk-in closet is adjacent to the bathroom (though there are doors that close) and worry about mold, yard in the back could be bigger with more privacy since neighbors can view straight down, and it's about 1.5 hours from wife's work (further for mine probably but I leave early comiong in and out of work and can deal), and of course the carpet throughout needs to be gutted and replaced with hardwood, kitchen and bathrooms need renov., has not been updated since 1995 when it was first sold as new for mid $300,000's. I estimated the renov will cost between 60-100k. Maybe the West Hills area is worth $900K+ and I will have to accept that. I don't know yet.

Message 80 of 226
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