Is the Mortgage Underwriting process horrible for everyone now? (escrow, foreclosed, bank)

[dmk31088]

My husband and I both had credit scores in the 700s and I can't remember the mortgage process as being a walk in the park filled with rainbows and fluffy bunnies. We received our conditional approval rather quickly and I only had to submit a few LOE's (did them all in one night). The waiting drove me nuts and the thought that ANYTHING could happen drove me crazy and the fact that we were buying while the government was dealing with sequestration (my husband is the breadwinner of the family and a federal employee), furloughs and the best part..... BEING SENT HOME WITH NO PAY THE WEEK WE WERE SUPPOSED TO CLOSE ON THE HOUSE (leaving us with ZERO income)....

it all worked out, but I'm not trying to buy one more piece of property for a very long time.

[Pfhtex]

Originally Posted by campion

Thanks for this: I'll ask for a checklist as opposed to having everything come to me as it's needed. That way I can (try) to stay ahead of the game. Can you explain what you mean about showing "more" money in the bank? More than the closing costs?

Post-closing Reserves. That component varies by loan type, whether it's a primary residence, about 20 other factors.



Here is The Checklist:

• 2 years Tax Returns, Federal/State/Business, all pages
• If you Extended 2013, send the extension, and 2011 returns
• W2s all jobs for 2012 and 2013
• One month recent paystubs, keep sending 'em through closing
• 2 months' Bank statements, all accounts, all pages, even that last blank one
• If you have more than enough accounts, we might not need the little ones, your mileage may vary
• REFINANCE: Send Declarations page from your homeowner's insurance policy, a payment statement for all mortgages on the home, and the Mortgage NOTE from the paperwork from your prior transaction on that property.
• Retirement accounts - pdfs not screen prints, all pages
• Contact info for landlords for past 2 years if you've been renting,
• Check copies for rent payments for the past year - if you've been paying rent in cash, or if the checks do not perfectly match the rental agreement, get ready.
• Employers for past 2 years, full contact info
• Drivers License and SS card, Green Card if you are a Resident Alien
• If you are a non-Resident Alien, we can still do this, but we need to talk
• Divorce Decree, all pages, if applicable
• Proof you are actually receiving child or spousal support (check copies)- also, it must be Court Ordered.
• Bankruptcy discharge if applicable
• Maybe even all the bankruptcy papers. #Fun
• Social Security /Disability Award Letter - the one you get every year saying "this is how much you get"
• Proof of continuance of Disability
• VA: DD214. A Good lender will get the COE for you. Disability letter if applicable. God Bless you and thank you.
• Self Employed? We're using Line 31 of Schedule C's, or full business returns, need the K-1, need Articles of Incorporation, need proof of when you started the business, if you shifted from S/E to a W2 job, or vice versa in the past two years, strap in.
• Bonus Income? Go ahead and dig up end of year paystubs for the past two years so we can average it. I'm sure you kept them, laminated and handy right on the refrigerator.
• Same deal with W2 income that includes overtime or is part time
• Part time = any income where the employer will NOT say that you are designated as Full Time with a guaranteed minimum of 40 hours per week.
• Again, your mileage may vary based on your Lender
• Pregnancy leave? We're gonna need the kid. Not really. Just a letter, and a copy of the leave from your employer, and proof you went back to work.
• New job? How new? Are you Contract or really full time? Can of worms.
• Buying a home with a wood stove? Check this out: If it is not Certified, or certifiable, it will have to be removed and the hole capped. Then after we close, nobody really cares if you put it right back. I didn't say that.

LOEs:<ul>Letters of Explanation. These can literally be one sentence at times, and they tend to 1)Document the obvious and 2) really annoy. Make sure you hand-sign and date them.
Credit: LOE for every single Inquiry on your credit report, including the one made by the bank to whom you are making this very application
Derogatory Credit: Collections, late payments, post-Bankruptcy derog's. Remember, you are borrowing at times several hundred thousand dollars, sight-unseen. Make it look good, make it look like you care.
Job c

[dmk31088]

Originally Posted by Pfhtex

[*]2 months' Bank statements, all accounts, all pages, even that last blank one

We were held up in underwriting for the lack of that last blank page - and then yes, our underwriter put our file to the back of the line to REPROCESS it after she got the LAST BLANK PAGE. 3 additional days for her to look at a blank piece of paper she told the LO she KNEW was probably blank.

[campion]

Originally Posted by Pfhtex

Post-closing Reserves. That component varies by loan type, whether it's a primary residence, about 20 other factors.



Here is The Checklist:

• 2 years Tax Returns, Federal/State/Business, all pages
• If you Extended 2013, send the extension, and 2011 returns
• W2s all jobs for 2012 and 2013
• One month recent paystubs, keep sending 'em through closing
• 2 months' Bank statements, all accounts, all pages, even that last blank one
• If you have more than enough accounts, we might not need the little ones, your mileage may vary
• REFINANCE: Send Declarations page from your homeowner's insurance policy, a payment statement for all mortgages on the home, and the Mortgage NOTE from the paperwork from your prior transaction on that property.
• Retirement accounts - pdfs not screen prints, all pages
• Contact info for landlords for past 2 years if you've been renting,
• Check copies for rent payments for the past year - if you've been paying rent in cash, or if the checks do not perfectly match the rental agreement, get ready.
• Employers for past 2 years, full contact info
• Drivers License and SS card, Green Card if you are a Resident Alien
• If you are a non-Resident Alien, we can still do this, but we need to talk
• Divorce Decree, all pages, if applicable
• Proof you are actually receiving child or spousal support (check copies)- also, it must be Court Ordered.
• Bankruptcy discharge if applicable
• Maybe even all the bankruptcy papers. #Fun
• Social Security /Disability Award Letter - the one you get every year saying "this is how much you get"
• Proof of continuance of Disability
• VA: DD214. A Good lender will get the COE for you. Disability letter if applicable. God Bless you and thank you.
• Self Employed? We're using Line 31 of Schedule C's, or full business returns, need the K-1, need Articles of Incorporation, need proof of when you started the business, if you shifted from S/E to a W2 job, or vice versa in the past two years, strap in.
• Bonus Income? Go ahead and dig up end of year paystubs for the past two years so we can average it. I'm sure you kept them, laminated and handy right on the refrigerator.
• Same deal with W2 income that includes overtime or is part time
• Part time = any income where the employer will NOT say that you are designated as Full Time with a guaranteed minimum of 40 hours per week.
• Again, your mileage may vary based on your Lender
• Pregnancy leave? We're gonna need the kid. Not really. Just a letter, and a copy of the leave from your employer, and proof you went back to work.
• New job? How new? Are you Contract or really full time? Can of worms.
• Buying a home with a wood stove? Check this out: If it is not Certified, or certifiable, it will have to be removed and the hole capped. Then after we close, nobody really cares if you put it right back. I didn't say that.

LOEs:<ul>Letters of Explanation. These can literally be one sentence at times, and they tend to 1)Document the obvious and 2) really annoy. Make sure you hand-sign and date them.
Credit: LOE for every single Inquiry on your credit report, including the one made by the bank to whom you are making this very application
Derogatory Credit: Collections, late payments, post-Bankruptcy derog's. Remember, you are borrowing at times several hundred thousand dollars, sight-unseen. Make it look good, make it look like you care.
Job c

Thanks. Helpful indeed.

[Pfhtex]

Originally Posted by campion

Thanks. Helpful indeed.

It cut off - I messed it up - - I reposted the Unabridged version just now. Sorry.

[campion]

Originally Posted by Pfhtex

It cut off - I messed it up - - I reposted the Unabridged version just now. Sorry.

- that's okay, I get the gist. I had my first terrible scare today after I posted in this thread. Got a call from the loan officer asking me to call asap. Turns out his company no longer works with PHFA (the type of mortgage I'm getting) and he wanted me to know and advise me on who to go to. Eek: got really scared he saw something in the new docs I'd sent over that was going to screw me over!

[Kjmh64]

You are living my life right now. We have a contract on a cute little ranch house to be used by my daughter while in college and possibly by us in retirement. Mortgage process has been above and beyond ridiculous with WELLS FARGO! Our financial situation is very similar to yours. Husband has great salary history, received raises and promotions over the past few years and they wanted an explanation as to why his income has gone up! Really? I would consider this a positive event without need for explanation. Making more money is always a good thing, don't you think? The questions they ask make us feel like we are trying to scam someone. They also wanted every statement from every account, including 401k even though none of the funds needed will be taken from that account. We were scheduled to close tomorrow and I found out 2days ago that there was a "miscommunication" somewhere and the Underwriters will not be finished "Approving" our paperwork. DO NOT USE WELLS FARGO. I highly recommend CapitalOne360(formerly known as ING) and wanted to use them again since I had a refinance that went smoothly with them. However, at this time, they don't provide mortgages on second homes. After all the nonsensical paperwork requests and stress involved in this process our plan is to pay off the mortgage within 3 years with hubby's bonuses and stock grants so WELLS FARGO won't make much money off of us us from the interest charges.

[windrunner4484]

The underwriters on our loan are a joke. We built an addition on the house for my Mom who is now in a nursing home. Back then she wanted to be independent and insisted on two meters for the electric. (Her "own" bill). Now the underwriters turned us down because of the two meters. We are dealing with people that we have had loans with before and never had this problem. They insisted it be appraised as two units. In this subdivision you CAN NOT have two homes on the same lot, hence it's attached to our house. But because we have two meters they said it's two units. UGH! The appraiser couldn't find any comps so we're sunk. Wanted to refi for half it's value and sell the house. But no deal. This really is stupid.

[Lovehound]

This topic is way too long. Read every post? Surely you jest!

On my 3rd and 4th closings this year my lender has asked me for everything, EVERYTHING! I've joked about sending in my blood panel although I did tell them my blood type -- as a joke!

I've finally reached the point where I'm even sending them stuff they didn't ask for. Actually it was stuff I think they should have asked for but forgot, so I anticipated their request and just sent it along, including all my recent credit card statements -- zero balance -- and for some reason they never noticed I opened an account at Chase for collecting rent and paying mortgages on my rental houses -- that was the one I sent in just because I figured one of the underwriters might wonder where the rent money is going.

So my last two houses are in underwriting for a late June closing. I haven't made up my mind yet what my answer will be if they ask me for a colonoscopy.

[Siggy20]

Originally Posted by Kjmh64

You are living my life right now. We have a contract on a cute little ranch house to be used by my daughter while in college and possibly by us in retirement. Mortgage process has been above and beyond ridiculous with WELLS FARGO! Our financial situation is very similar to yours. Husband has great salary history, received raises and promotions over the past few years and they wanted an explanation as to why his income has gone up! Really? I would consider this a positive event without need for explanation. Making more money is always a good thing, don't you think? The questions they ask make us feel like we are trying to scam someone. They also wanted every statement from every account, including 401k even though none of the funds needed will be taken from that account. We were scheduled to close tomorrow and I found out 2days ago that there was a "miscommunication" somewhere and the Underwriters will not be finished "Approving" our paperwork. DO NOT USE WELLS FARGO. I highly recommend CapitalOne360(formerly known as ING) and wanted to use them again since I had a refinance that went smoothly with them. However, at this time, they don't provide mortgages on second homes. After all the nonsensical paperwork requests and stress involved in this process our plan is to pay off the mortgage within 3 years with hubby's bonuses and stock grants so WELLS FARGO won't make much money off of us us from the interest charges.

Your post echoes our experiences. My husband almost blew a gasket when he had to write a salary letter as well. His salary went down from what he made in NYC but he still makes a nice amount and we have more than enough to pay the mortgage from my retirement pension alone. Our Wells Fargo savings account has enough to buy this house outright if need be. With all that said, you would think that we were criminals waiting to do something nefarious with respect to our mortgage. Guilty until proven innocent. To be asked to write a letter for an increase in income is ludicrous. Just tell him that your husband just started a more profitable meth lab in your house....

My problem with Wells Fargo (our experience) is that they don't have their crap together in regards to the underwriting. If you are going to be a PITA about underwriting, at least make it standard for applicants. If I knew that I had to get together 20 pieces of information from the get-go, then fine. Pfhtex posted an excellent checklist. Give the applicants this information from the start and don't string us along. We would get the "Oh, this is it. You are done." Then the next day, the underwriters would ask for new documentation.....the last piece of documentation requiring me to make a mad dash to the Wells Fargo mortgage office to get it in on time. Hopefully this was the last piece of information we needed and we get to close this week. My confidence is still shaken at this point and you never know.

Our loan officer was fantastic and went to bat for us multiple times with underwriting as they asked for more and more things. If I had to do it again, I would NOT use Wells Fargo. After this is said and done, I'm writing a letter. They have such a lousy reputation and we should have heeded our realtor's advice to avoid them. When I complained to a manager when I went to their mortgage office, his answer was, "Yes, we know it is difficult but Wells Fargo manages to close a huge number of loans each year so we aren't doing badly at all." What he failed to realize is that the experience on the customer's end SUCKS!

I'm like you. Thinking about paying this loan off quickly and not let them make as much interest off of us, lol.