I am rooting for a happy ending here. But the hassles Josh (not his real name) have encountered trying to close a pretty straightforward mortgage to buy a new home in Sudbury have already left a bad taste.
First, Josh is to be congratulated for pulling off a difficult feat in this crazy market: He found a way to sell his Waltham house and is with a few signatures of moving into a larger home in Sudbury priced somewhat under $800,000.
A corporate finance guy, Josh and his wife bought a fixer-upper in another western suburb seven years ago. Three kids later, it was time to move to a bigger home.
In a down market, Josh should be a prize catch for mortgage lenders desperate for new business - he's a guy with a high-paying job and a great credit score who is ready to put down 20 percent.
"We feel pretty fortunate to be able to make a move to a new house at this point," he writes.
So everything was set to roll when the bank writing a second mortgage on the deal suddenly bails. It needs more time for, get this, "clearing the close conditions," basically a last round of income verifications and checking recent pay stubs.
Of course that's nonsense - Josh's broker believes, and is probably right, that the bank is simply caught up in a processing backlog.
But the delay has created a big mess for Josh, who had scheduled the closing on the Sudbury home followed a week later by the closing on the smaller house he is selling to make the move. Between the two closings, Josh had lined up contractors to do some upgrades and repairs to his new home, including chimney and plumbing work.
Here's what Josh has to say.
"That is no consolation to have to reschedule closing two days before we expected to close. What an inconvenience for ourselves and the sellers. I'm quite frankly shocked that with all the news about everything from sales to originations being at "record lows" they can't seem to close a pretty straightforward heloc with 45 days lead time, and 3 full weeks after their commitment date? I mean we have credit scores just below 800, a good set of assets backing us up, and income that we were told could support a payment much larger than we are comfortable with and seeking here."
But Josh is not just frustrated by the roadblocks. He wonders rightly what this says about the sorry state of the mortgage lending market.
"This all begs the question for me, just what does it take to get through the process without issues at this point? How would this look if we were seeking 85-90% LTV and had lower credit scores. No wonder real estate sales are in the dumper. This "process friction" is a real downer that would make me think twice about selling vs. staying in the future."
Where are all those robo-signers when you need them?
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