Lisa and Jim's Northern Nevada Real Estate Blog: OMG! Ever Been Undermined By An Underwriter?

OMG! Ever Been Undermined By An Underwriter?

I'm nearly bald from pulling my own hair!

What in the wide wide world of business is going on?  And ... Who died and made them boss?

First we work our buns off finding a house and getting the customers into escrow, next we slug though the negotiations and get an escrow open, then we sweat the inspections and the appraisal!  Almost there ... closing in sight ... then ... out of left field ... here comes the underwriter!

Yesterday, after days in underwriting, we finally got "conditional" approval.  We got Loan approval conditioned on the buyer's employer writing a letter stating that they don't anticipate having any reason to need to "lay off" the buyer in the future.  Let me get my crystal ball and take a look!

Besides being a total waste of everyone's time and completely useless, a letter like this isn't worth the paper it's faxed on! 

This brainiac decision was just shortly preceded by another underwriter who decided that they would approve a loan for buyers on a home being purchased "As Is" with the condition that a number of repairs be done prior to the close of escrow!  Do you understand "As Is" ?

The real question is ... Why is this Happening?  I truly understand that they need to be careful but ... "Give Me  Break!"  Where does reality fit into the equation?  

Lisa Wetzel and Jim Valentine are the authors of this blog.  Lisa, Jim  and Jessie are experts in Carson Valley, Carson City and the tri-county area of Douglas County, Carson City and Lyon County.  Call our team anytime at 775-781-5472 or 775-781-3704.  To Search for Homes visit our website at www.CarsonValleyLand.com

Comment balloon 14 commentsLisa Wetzel • May 30 2009 08:10PM

Comments

That is pretty crazy. Like that letter would prevent the person/persons from being laid off.

Posted by Kim Curran (RE/MAX Unlimited of Northern Virginia) over 9 years ago

Wow -- these are some new wrinkles we have not seen -- bu likely to I would suspect.

Posted by Bob & Carolin Benjamin, East Phoenix Arizona Homes (Benjamin Realty LLC) over 9 years ago

I've had it where they asked for repairs on an "as is" also, and it's miserable!  The bank we were working with did go ahead and make some of the inexpensive repairs, but the rest were finally waived by the underwriter.  I think you only need an 8th grade education to be an underwriter.

Posted by Donna Harris, Realtor,Mediator,Ombudsman,Property Tax Arbitrator (Donna Homes, powered by JPAR - TexasRealEstateMediationServices.com) over 9 years ago

Interesting times we're in aren't they? I'm curious. Was this a national bank or a mortgage broker providing private funds. Inquiring minds want to know.

Posted by Vickie Nagy, Vickie Jean the Palm Springs Condo Queen (Coldwell Banker Residential Real Estate) over 9 years ago

I can attest to the powers of underwriting--my seller has been waiting on the buyers funding--they've been stuck in underwriting for almost 2 weeks. I hate to be a pest but my sellers are anxious and already have a house awaiting contracts. HOW LONG does it REALLY need to take?!

Posted by Janice Doty (Better Homes and Gardens Real Estate~Rand Realty) over 9 years ago

In my experience these types of brainless underwriting conditions are indicative of a lender that can't find a legitimate reason to deny a loan.  They hope to wear you out, trip you on a technicality or let the clock run out on the buyer's rate lock all the while hoping the buyer will get jacked and go elsewhere.  Underwriting has always been the black hole of the mortgage process.

Posted by John Secor (EXIT Real Estate Results) over 9 years ago

Underwriting hell seems to be the new hang-up.  I had a loan stuck there for 3 weeks and we were asked to fix a broken faucet and a loose railing on an As-Is property.  This process seems to have gone off the deep-end.  Its really crazy.  Good luck getting it closed.

Posted by Dr. Stacey-Ann Baugh, A doctor who makes house calls. (Century 21 New Millennium) over 9 years ago

Now that is crazy.  That the boss has to sign a letter like that do you think the byer would be buying a house if they thought they were going to get laid off. 

Posted by Russ Ravary ~ Metro Detroit Realtor call (248) 310-6239, Michigan homes for sale ~ yesmyrealtor@gmail.com (Real Estate One) over 9 years ago

The underwriters of the world appear to be going crazy.  Must be all the pressure of shooting at a moving target.

But some just can't shoot straight regardless.

Posted by Jim Hale, Eugene Oregon's Best Home Search Website (ACTIONAGENTS.NET) over 9 years ago

Lisa, This is having other impacts on our industry - like platinum plated buyers being told they can't put stuff in the garage because we haven't gone through underwriting yet.  Normally, this would not be a matter in this specific situation, but given the recent ridiculous underwriting conditions we now have to adjust how we conduct our business.

Posted by Jim Valentine (RE/MAX Realty Affiliates) over 9 years ago

Lisa, there always seems to be "one more thing" that's needed for underwriting but this really takes the cake.

Posted by Silvia Dukes PA, Broker Associate, CRS, CIPS, SRES, Florida Waterfront and Country Club Living (Tropic Shores Realty - Ich spreche Deutsch!) over 9 years ago

This is one of the main reasons I loved owner financing so much when I was selling real estate, we didn't have to worry about an appraiser or an underwriter screwing things up at the last minute.

Posted by George & Arlene Paukert (Road to Wealth, Inc.) over 9 years ago

This really is ridiculous, just like the missing portable microwave condition I overcame earlier today. I just don't get it.

Posted by Christianne O'Malley, Exceptional Service - Delivering Results in Reno! (RE/MAX Realty Affiliates) over 9 years ago

I actually had something similar several weeks ago.  Buyers from Ca, coming to In.  The Mrs. has been here since Oct, due to a job transfer, same company for 18 years.  They wanted to do the right thing, and purchase a home based on her income alone, because they were unsure of when the house in Ca would sell and if the Mr.'s company would have a position open for him here once the home there sold.  Lender insisted the husband be on the loan, underwriting wouldn't approve the loan, unless the Mr.'s employer wrote a letter to guarantee that once the Ca. house sold, whenever that might be, they would have a position for him in Indiana.  Finally did get it closed, with a different lender who did it only with the Mrs., and didn't require the Mr. to be on it.  Completely crazy to have that type of condition.

Posted by Dawn Whalen, Managing Broker (Whalen Realty Group,LLC) over 9 years ago

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