topic Re: mortgage fell thru 72 hours before closing!! help! in Mortgage Loans

mortgage fell thru 72 hours before closing!! help!

reba1 — Wed, 25 Feb 2015 01:58:10 GMT

I was pre-approved for $400k. Scores fine, income fine, file complete, accepted purchase agreement, escrow money paid in, appraisal, inspection completed, PREAPPROVED letter from the lender.......BAM!!!! Rug pulled straight out from underneath and immediately denied 72 hours prior to scheduled closing. The reasons were:

1. due to the fact that the purchase was for a home and 100 acres of land together. I have been told that there is a 10 acre limit with a dwelling? Or it is considered ag?

2. Apparently the appraisal had comps from another county and that is not accepted? this home is in a rural county/area where there are not a lot of homes and land that sell often. so the appraiser had no choice but to pull 2 comps from the county and he pulled 2 comps from another about 25-30 miles away.

3. my income is w-2 and self employed income. At the last minute my self employment income was thrown out and therefore just my w-2 income did not support the dti ratio. Keep in mind that my self employment income is in the 6 figures. well above the required dti.

Does anyone know any possible reasons as to why the lender would not know the fact of any of these prior to? I lost all my earnest money. All the appraisal and inspection monies too. File closed over and done. No real explanation other than the above. Just trying to make sense of it.....hopefully someone can help.

Thanks.

Re: mortgage fell thru 72 hours before closing!! help!

StartingOver10 — Wed, 25 Feb 2015 02:06:10 GMT

Sounds like you made application with a bank and not a mortgage banker. In any event your LO was negligent in contacting the underwriter. If there are unusual items (100 ac is not typical for residential financing), LO had a duty to contact his u/w and find out the max land allowed. In my area the max is 5 ac for a residential loan. It may be different in your area.

There are distance parameters set for appraisals. Usually within a mile of the subject property. However, given you are in a rural area and the subject property in on 100 ac there must be an exception for the distance (longer than one mile). Again your LO should have gotten in touch with the u/w immediately when you supplied the contract before beginning to process it to find out how large parcels are handled. Maybe a portfolio product or commercial product rather than a regular residential loan.

There is no excuse for throwing out the self employment income so late in the process. This is something the LO should have known from day 1.

Tell me, was it one of the big box banks? Which one?

Re: mortgage fell thru 72 hours before closing!! help!

jfg1022 — Wed, 25 Feb 2015 02:08:26 GMT

Yikes so sorry that happened. Did you go to a bank or a mortgage lender? Our mortgage lender ran all of our income and statements through an underwriter for fully underwritten pre-approval before he even gave us the pre-approval letter. Maybe one of the mortgage guys on here can help you out? Did you try to extend your contract to get extra time for financing??

Re: mortgage fell thru 72 hours before closing!! help!

reba1 — Wed, 25 Feb 2015 02:12:02 GMT

It was not a big bank but a mortgage broker that I thought would know what to do.

Re: mortgage fell thru 72 hours before closing!! help!

reba1 — Wed, 25 Feb 2015 02:15:21 GMT

i have requested an extension with the seller for 30 days (not accepted yet) to try and get I assume an agricultural loan, which is bizarre to me. How does 100 acres of land have zero value and cause the appraisal to be actually LESS than what is needed? Just makes no sense how people who do these everyday allows people to be misled like a game. I feel like someone is just pulling the strings an I am the puppet.

Re: mortgage fell thru 72 hours before closing!! help!

Anonymous — Wed, 25 Feb 2015 02:17:46 GMT

Reba, I'm so sorry to hear of your loss. 100 acres sounds like a dream.

Re: mortgage fell thru 72 hours before closing!! help!

StartingOver10 — Wed, 25 Feb 2015 02:18:38 GMT

@reba1 wrote:
It was not a big bank but a mortgage broker that I thought would know what to do.

Mortgage brokers have no skin in the game. They only put the parties together - borrower and lender. They prepare a package they think someone will finance and shop it to various lenders.

A mortgage banker, on the other hand, originates and funds the loan. The u/w reviews it and approves or declines - and they know all their criteria right up front. After you close the loan is sold, but that doesn't matter to the borrower because it is sold on the basis of the terms of the loan already closed and funded.

You really want to work with a lender that actually underwrites and funds the loan - but not a big box bank. They have similar issues to mortgage brokers for a different reason (centralized mortgage process doesn't work well).

Re: mortgage fell thru 72 hours before closing!! help!

reba1 — Wed, 25 Feb 2015 02:23:16 GMT

Thanks for all the responses. I am not sure where to go next or really what to do. If the seller agrees, I have 30 days to finalize this again..

Re: mortgage fell thru 72 hours before closing!! help!

StartingOver10 — Wed, 25 Feb 2015 02:31:01 GMT

Try https://www.farmbureaubank.com/

They do large parcels. I don't know their min or max acreage though. Ask.

Re: mortgage fell thru 72 hours before closing!! help!

reba1 — Wed, 25 Feb 2015 02:36:01 GMT

thanks!!