We often have complaints from our clients who are in the process of getting a loan about the incessant demands for documentation from their mortgage company.
Likewise we hear the same rumblings from loan officers about borrowers that resist every plea for additional paperwork.
As a real estate broker, I have often conciliated the pangs of animosity between the two that seem to fester on nearly every deal. And I usually tell the buyer to buck up and deliver regardless of how petty the request seems to be.
But now I am on the other side of the fence. I’m trying to take advantage of record low interest rates by refinancing my home.
As a self-employed contractor, it’s not just a matter of whether or not I WANT to comply with every request for documentation; it’s about whether or not I CAN comply.
To me it all seems so highly illogical from the get-go. I have been paying a mortgage payment for many years without so much as a single late payment, so why would it be more difficult for me to pay a lower payment?
The loan to value ratio is about 50% even in today’s market. It seems like a no brainer,
I am being asked to jump through hoop after hoop, and I am getting frustrated.
But the lure of an interest rate in the “threes” is just too enticing. So I will continue to meet each new request with proper diligence.
But I now have a new appreciation for buyers that are squeezed through the wringer.
And I will be a lot more empathetic from now on!
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Defying logic..."been paying a mortgage payment for many years without so much as a single late payment, so why would it be more difficult for me to pay a lower payment?" Good luck!
Richard, you must have come to the same conclusions as my husband and I at the beginning of the year. We are also looking to refinance and feel the same pain from processes that are overly tedious and sometimes plain illogical. Best of luck!
Good morning Richard,
Last summer we bought a new house. We had to go through the whole home buying process from beginning to end. We actually lost one house in a highest and best situation and started over again. I was going through what buyers go through everyday. It was very enlightening and refreshing for me to experience that side of it. (It had been 14 years since I had purchased my first house).
The price we pay for being self employed .. mountains of documentation & paperwork trails to provide to the lender. I went through the same process a year ago and my gosh it was a dose of reality. I now have gained a much higher appreciation for my buyer clients who have to climb the mountain of paperwork to get a loan. Like you, wouldn't the fact that you would be paying less for a loan that you never were late on cut some of the butter? Not in today's lending environment. Good luck!
You know, it is absolutely true that when you can personally relate to (or sympathise with - in this case) your buyers, it gives you great insight into their fears, needs, and stress levels. I find that having just recently bought and sold my own home, I am much more "fresh" in terms of understanding the feeligns these buyers are going through in the current climate.
Richard, My son is getting ready to close on his first house, and he keeps calling me wondering why they keep asking him for the same information over and over. I'm sure glad I can confidently say, "Go talk to your Realtor," who happens to be a good friend of mine. This has to be very frustrating for agents, but I'm glad to see your walking away with a perspective that your buyers will appreciate in the future.
Have an awesome day!
Banks are looking out for security. . . something they didn't not do a few years earlier. .
I have a hard money lender that will refi your house in 24 hours. .. no questions asked after a quick check of value to loan ratio. .15%?
Of course the new loan gets sold to an investor who demands to know you still have good credit, the same job, the home is worth what it was before. It would have been nice if a stimulus package was given to home owners so everyone could just get lower rates on their current mortgage...the extra monthly cash would really stimulate the economy but of cours politicans are not that smart.
We should probably all be required to move every so often too Richard, so we can fully appreciate the angst of that as well! :-)
I hear you, Richard. I've been toying with the idea, but delivering all of the required docs just seems a little overwhelming some days. Good luck with that!
Richard, My husband and I refinanced and closed at the end of September and I have to say it could not have been easier:) Closed without a hitch and my first payment was smooth too. I am always concerned when I refi that somehow the direct withdrawal will get messed up since the payment is going to someone "new" but all is well and we got a rate of 3.3. Good luck to you...I hope the closing goes smoothly!
Good point...we can better understand their frustrations if we have to feel them too right?
Richard my wife and I refinanced not long ago. Good grief they wanted everything but our dog's city license number. It was stressful and a ton of work. Going through the process really made me stop and rethink how I often flew through the process not noticing the deer in the headlight look from my clients. Now I can relate and so I've slowed it down, take even more time to explain and have even shared my stress of my little refinancing deal with some clients so they know I feel their pain.
I have heard the same complaint from my buyer clients - they don't understand why they have to produce the same paperwork over and over again. I confess, I don't understand that either, but I tell them to get whatever the lender is asking for in ASAP. The whole financing process has become laborious.
Richard, if the bank isn't going to keep yoiur loan, then they are doing all this stuff to show the buyer you are a good risk.
Still a pain in the....
An excellent reminder for all of us to step into our sellers and buyers shoes to try and better understand their emotions. Good luck with your refi!
Richard! I'm so frustrated with this! It's crazy!
Richard, It's always best when we can see both sides of the coin. Good luck with your refinance. Keep your patience!
I delivered about 4 inches of paperwork to the lender last week...trying to refinance my house into a 15 year note. And like you, I have about 50% equity. We'll see how it goes...