How long can we shop around ?

[Anonymous]

So we are in tough predicament right now. I have another thread about being preapproved twice and then denied a week later after our offer was accepted. We don’t want to lose this house. We have set to close by July 1 so we are going to give it some time to straighten things out. 

I contacted another lender yesterday who said they think this loan sounds doable and is trying to make it work for us. I’m pretty much going down the list of lenders trying to see someone who can help us. It doesn’t seem impossible. All the numbers and factors say we qualify but the automated underwriter says risky. 

Is it ok to just keep finding someone who’s willing to take the risk? We don’t want to lose out on this perfect home for us. We are also working on things to make it better like paying off a credit card which will boost scores and lower ratio a bit. 

[ShanetheMortgageMan]

How long can you shop around?  Until the seller has had enough and decides to cancel the contract.

Is it OK to just keep finding someone who's willing to take the risk?  Yes, certainly.  You'll never make a shot you don't take.  I've had clients apply at numerous lenders before they've found us to do their loan.  If they gave up after the 2nd or 3rd lender they may still be renting right now.

Advice to everyone reading this, if you have issues getting approved and are under contract, then make sure you are communicating these issues to your real estate agent.  They are there to help you and make sure you are sticking to the terms of your contract.  From what I've seen, it's lack of communication that primarily creates issues between buyers & sellers when buying a home.  

[JVille]

Your contract should clearly spell out how many days you have to make Formal Loan Application and payment of fees to the lender. Usually this does Not exceed 3 days, next you have a clearly defined # of days to remove contingency (inspections) failure to meet ANY of these deadlines puts you in Default of your contract. So you do not really have until July 1st.

Where the Blank blank blank is your RE Agent? They should be getting you over to their favorite “Make it work” Lender instead of their buyer struggling to find a lender.

[JVille]

And we have no answer...

[Anonymous]

I haven’t told our RE agent because he’s a dual agent and I’m afraid he’ll tell the seller and she’ll want to back out. Is that possible? I wanted to give this 3rd lender a try first and then let him know. 

Anyway I found a lender that got us an approval through USDA with an explanation letter about the emplyment gap. So I guess it’ll be up to the UW to approve. 

Its frustrating because each lender has gotten us an approval for conv, fha and now USDA and they each had a reason why the other wouldn’t work. 

First bank said USDA has lower ratio max so it wouldn’t approve. But she didn’t use accurate numbers (like the actually RE taxes) or factor us putting 5%  down to qualify. It’s a lower mortgage insurance too it’ll put us at 39% and the max is 41%

Second lender said no to USDA automatically because they don’t allow you to own another home but USDA states as long as the home your purchasing through USDA is primary and the other one isn’t in the area (it’s in another state) than it’s fine. 

Its frustrating because they seem to not really be looking at all the facts before saying yes or no. That’s why we are here. 

[JVille]

So you are saying you bought this home thru the Listing Agent? There is only one agent in the transaction and he/she will get paid both sides of the transaction?
This Realtor should still be shepherding you thru the process to protect both his seller and his 2sided commission. Your agent is going to freak out when he contacts your original lender to find you have been denied. You need to make your Formal Application yesterday!

[Anonymous]

We had the application in and a full commitment letter when we made the offer. The lender changed their story a week later. So we are trying hard to get back on track! 

[JVille]

Did you buy direct from the Listing Agent????

[Anonymous]

He is the listing agent and also our agent. So yes he is getting the full commission. 

[JVille]

Ok, have you made formal application and paid your Application fees? That’s all that will matter when he finds out and you have a Letter Of Pre Qual for him.