Backup lender or nah?

[egaithe]

Ok guys, I was supposed to be closing tomorrow, but my lender, BBVA is asking for additional documentation of something that I may not be able to get (I don't want to say because I don't want to risk biased answers). Should I get a back-up lender and would the hard inquiry jeopardize my pending loan with BBVA?

[dragontears]

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@egaithe wrote:

Ok guys, I was supposed to be closing tomorrow, but my lender, BBVA is asking for additional documentation of something that I may not be able to get (I don't want to say because I don't want to risk biased answers). Should I get a back-up lender and would the hard inquiry jeopardize my pending loan with BBVA?

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If you are closing tomorrow it is too late for a backup lender 

[egaithe]

it's not gonna happen, they're awaiting the documentation.

[dragontears]

Do you have a reason to believe that a different lender will not require whatever the documents your current lender wants?

Is the documents something that you can't provide or just need time? If time, how much?

Is the seller willing to work with you on the delay?

A new lender is going to need time to process and underwrite the loan, depending on the loan type may need to get a new appraisal, think 2 weeks minimum if you can find a really good one (and with the flurry of refi going on that may be really hard to do)

[egaithe]

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@dragontears wrote:

Do you have a reason to believe that a different lender will not require whatever the documents your current lender wants?

Is the documents something that you can't provide or just need time? If time, how much?

Is the seller willing to work with you on the delay?

A new lender is going to need time to process and underwrite the loan, depending on the loan type may need to get a new appraisal, think 2 weeks minimum if you can find a really good one (and with the flurry of refi going on that may be really hard to do)

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I believe the l will get approved with new lender with no issue because credit status has changed immensely.

[IOBA]

It would help if you said what the new request for documentation is.

Are you 100% sure the lender will NOT close without this new docuementation?

About four years ago, I was in the process of buying a property.  The day or two before closing, the loan officer calls me and says the underwriter wanted more documentation.  I had a joint account with my husband and the funds for down payment were coming from that account.  I had already provided a hand written document that stated my husband had full rights to all the funds in that account and I was "gifting" him the funds.  I **think** the requirement was for me to remove my name from the joint bank account.

I told the loan officer it was redundant and absurd request.  I asked what the purpose of this new documentation was for.  What was driving the unusual, last minute request?  The LO had no idea.  He told me to just do it.  I resent the hand written letter stating the money was "gifted" to my husband.

I didn't remove my name from the account.  (To remove my name from the account would mean the bank account would have to be closed.)  We closed on schedule.

Over the years, there have been MANY absurd, last minute requests for additioanl documentation from the underwriter.  I ask what the purpose is behind the request.  It helps me understand what is actually being requested.  

[Revelate]

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@IOBA wrote:

It would help if you said what the new request for documentation is.

Are you 100% sure the lender will NOT close without this new docuementation?

About four years ago, I was in the process of buying a property.  The day or two before closing, the loan officer calls me and says the underwriter wanted more documentation.  I had a joint account with my husband and the funds for down payment were coming from that account.  I had already provided a hand written document that stated my husband had full rights to all the funds in that account and I was "gifting" him the funds.  I **think** the requirement was for me to remove my name from the joint bank account.

I told the loan officer it was redundant and absurd request.  I asked what the purpose of this new documentation was for.  What was driving the unusual, last minute request?  The LO had no idea.  He told me to just do it.  I resent the hand written letter stating the money was "gifted" to my husband.

I didn't remove my name from the account.  (To remove my name from the account would mean the bank account would have to be closed.)  We closed on schedule.

Over the years, there have been MANY absurd, last minute requests for additioanl documentation from the underwriter.  I ask what the purpose is behind the request.  It helps me understand what is actually being requested.  

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No different than one of my lenders stating I had to liquidate 80K worth of equities which made no sense.  

One thing I'd note is appraisals may be delayed because of COVID-19 depending where you are, seeing chatter about real estate addendums with that written in.  Weird times.

That said it used to be if you had all your ready and could clear UW in one pass a mortgage could be closed in a period measured in days, but these aren't normal times and rates were rising then and we didn't have these flood of refinances.  You'd have to pick a lender that prioritized purchases over refinances, and with the weird rates in the market you might lose on that front too.

It doesn't hurt to try, worst case you just have to explain the inquiries: "mortgage shopping did not lead to a tradeline or additional incurred debt" or similar.

[VALoanMaster]

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@egaithe wrote:

Ok guys, I was supposed to be closing tomorrow, but my lender, BBVA is asking for additional documentation of something that I may not be able to get (I don't want to say because I don't want to risk biased answers). Should I get a back-up lender and would the hard inquiry jeopardize my pending loan with BBVA?

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If BBVA isn't going to close your loan without this additional documentation & you cannot provide said documentation, you don't have any other choice but to find a new lender, right?

The only other thing I can think of is if the u/w is out of line in asking for documentation that isn't required under the program guidelines. In this case, your LO would need to go to bat for you to try & get this u/w to back off.