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This is mostly about a sucky customer, but his realtor was sucky, too.
SC calls and names a local realtor who’s suggested us as a bank who might fund his home purchase. He already applied at another bank, but he’s not happy with how high the closing costs are. He says they quoted him $3000 in closing fees, and I tell him ours run around $2000. He seems fine with that.
Then he says he had a bankruptcy about a year and a half ago, which he blames on an ex-girlfriend. I say that might be ok, if everything else is ok (his credit, income, etc.). It would be an exception to our policy, but we do that all the time.
So he comes in and fills out an application. He’s got $4000 in savings, so I ask where the rest of his down payment and closing fees will come from. He says it will be a gift. That’s a concern, but I don’t tell him that. After he leaves, I pull his credit. His score is low, but that’s because everything tied up in the bankruptcy is still showing on his credit. He hasn’t had any lates or other negatives since then.
But it’s iffy, so I go over it with Goodhair. The more I explain the SC’s situation, the less confident I am. Goodhair finally says to turn him down. The bankruptcy would be an exception already, and the fact that he doesn’t have enough saved up for the down payment is another ding against him.
I call the guy to tell him the bad news. He changes his story and says he has cash for the rest of the down payment and closing fees, but it’s cash because of the bankruptcy. (Hiding assets – that’s not a good sign.) I tell him if he’s willing to deposit the cash somewhere and bring us documentation that he has the funds that he needs (about $9000 total), we’d be willing to do the loan for him. He seems ok with that.
About an hour later, I get a call from the SC’s realtor saying SC is confused. I say he seemed fine when I talked to him. She says he doesn’t understand why he needs the cash for the down payment now – why can’t he save up until the closing date in May? I relay that when I spoke to him earlier, he said he had the cash, he just has to deposit it. She says he doesn’t have the cash yet, but he expects to save it up before May. And don’t we do no-cost mortgages? I say no, we haven’t done that in at least five years (longer, if my memory serves). She's sure it's been more recent than that, and we go back and forth a couple times before I simply say that we don't do them any more.
So it seems the realtor told him that we could do a mortgage with almost no closing fees, when that hasn’t really been a thing since the 2008/2009 housing crash. And he made an offer on a house when he didn’t have enough saved up for the down payment and closing costs. He said he has a prequalification letter from the other bank, so why not go with them? The closing costs he told me were only about $1000 higher than ours. If he can’t afford that, how is he going to afford his monthly payments?
There may be an update if he comes up with a down payment, but it's sounding unlikely.
SC calls and names a local realtor who’s suggested us as a bank who might fund his home purchase. He already applied at another bank, but he’s not happy with how high the closing costs are. He says they quoted him $3000 in closing fees, and I tell him ours run around $2000. He seems fine with that.
Then he says he had a bankruptcy about a year and a half ago, which he blames on an ex-girlfriend. I say that might be ok, if everything else is ok (his credit, income, etc.). It would be an exception to our policy, but we do that all the time.
So he comes in and fills out an application. He’s got $4000 in savings, so I ask where the rest of his down payment and closing fees will come from. He says it will be a gift. That’s a concern, but I don’t tell him that. After he leaves, I pull his credit. His score is low, but that’s because everything tied up in the bankruptcy is still showing on his credit. He hasn’t had any lates or other negatives since then.
But it’s iffy, so I go over it with Goodhair. The more I explain the SC’s situation, the less confident I am. Goodhair finally says to turn him down. The bankruptcy would be an exception already, and the fact that he doesn’t have enough saved up for the down payment is another ding against him.
I call the guy to tell him the bad news. He changes his story and says he has cash for the rest of the down payment and closing fees, but it’s cash because of the bankruptcy. (Hiding assets – that’s not a good sign.) I tell him if he’s willing to deposit the cash somewhere and bring us documentation that he has the funds that he needs (about $9000 total), we’d be willing to do the loan for him. He seems ok with that.
About an hour later, I get a call from the SC’s realtor saying SC is confused. I say he seemed fine when I talked to him. She says he doesn’t understand why he needs the cash for the down payment now – why can’t he save up until the closing date in May? I relay that when I spoke to him earlier, he said he had the cash, he just has to deposit it. She says he doesn’t have the cash yet, but he expects to save it up before May. And don’t we do no-cost mortgages? I say no, we haven’t done that in at least five years (longer, if my memory serves). She's sure it's been more recent than that, and we go back and forth a couple times before I simply say that we don't do them any more.
So it seems the realtor told him that we could do a mortgage with almost no closing fees, when that hasn’t really been a thing since the 2008/2009 housing crash. And he made an offer on a house when he didn’t have enough saved up for the down payment and closing costs. He said he has a prequalification letter from the other bank, so why not go with them? The closing costs he told me were only about $1000 higher than ours. If he can’t afford that, how is he going to afford his monthly payments?
There may be an update if he comes up with a down payment, but it's sounding unlikely.
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