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How to Avoid a Bad Mortgage Lender in Sacramento
You can reduce chances of getting a bad mortgage lender by staying local to Sacramento.
If you’re working with a bad mortgage lender, you probably won’t realize it until your file is submitted to underwriting and rejected. Because bad mortgage lenders, bless their little inexperienced souls, don’t generally mean to screw up your loan; you know, that’s not their intent. They should know the terms for which your loan will get rejected, but often they don’t. And to be even more objective, sometimes institutional lender guidelines allow for exceptions that mortgage brokers might not.
Let’s take Wells Fargo for example, just because that has been my most recent experience. As a top producer listing agent in Sacramento, I don’t work with Wells Fargo loan reps very often because most homebuyers in Sacramento choose to obtain their loan through a mortgage broker, and not a big box lender. They don’t like the impersonal service and mistakes they often obtain from big box lenders. Lenders all charge about the same rate. While you’ll always get those buyers who would throw their grandmother from the train to save 1/8% in rate while forgetting what happens when they bend over to grab the bar of soap, all the available lending money is pretty much the same big ol’ bag of money.
Still, I called this bad mortgage lender in San Jose when the first 3 weeks went by and my Sacramento seller’s escrow showed zero signs of closing. Let’s call that loan rep Dick, short for you know what. Dick explained the buyer could not qualify for a conventional loan because he had a short sale on his credit report from 3 years prior. The underwriter threw out the file. When I deal with these situations with our own buyers, we walk the file through underwriting for underwriting approval prior to even looking at homes, because conventional lenders are not required to make loans to people who had a short sale, and . . . the waiting period is 4 to 5 years, not three years.
In my opinion, this loan should never have been submitted for conventional financing due to the short elapsed period of that previous short sale.
But Wells Fargo did not disclose the short sale dilemma to us and, in fact, could not close this loan. I asked Dick why he tried to close a loan that did not fit guidelines in the first place. Because they make exceptions, he said. How many times have you gotten an exception? I pushed. A bunch of times. How many times, Dick? Would you say 10 times? Have you received exceptions 10 times? Well, yes. I don’t believe it. I’d say not only is he a bad mortgage lender, but he’s a liar, too.
The second time around, Dick at Wells Fargo suggested an FHA loan. FHA short sale guidelines are 3 years. However, unknown to us, the buyer was not intending upon occupying this property, even though the purchase contract stated he was an owner occupant. And let’s not even get into the fact his agent vanished for a while and I had to step in to help out the buyer. Of course, this FHA loan was not approved by Wells Fargo. The buyer lives and works in San Jose, not Sacramento, another fact undisclosed. You have to live in the home to get an FHA loan.
The only way I know that Wells Fargo rejected the loan is because the buyer received a rejection in the mail and contacted me when he couldn’t reach his agent. Dick over at Wells Fargo in San Jose could not be bothered to pick up the phone, call or send a text message. I contacted him using all 3 methods for four days straight. Usually, leaving voice mail messages and continuing to badger a bad mortgage lender will eventually get a response, but this time, nothing. No response. No phone call. Nada. The last time Dick failed to respond to me, the listing agent, or the buyer, he eventually would after I kept up the inquiries. This time, no. Communication should not be this difficult with these guys.
The buyer’s agent asked to extend while the buyer pursued a loan for investors. Nope, not doing it now. The seller will undoubtedly demand that you can cancel and submit a new purchase contract for the seller to consider, and the buyer will need to get approved through my recommended Sacramento mortgage lender. Unfortunately or fortunately — depending on how you look at it — my recommended mortgage lender could not approve the buyer because each desktop underwriting file, regardless of loan type, reflected a red flag. The buyer could not do an investor loan because then he would not have enough money to bridge the gap between appraisal and sales price.
I don’t know why bad mortgage lenders don’t see the same red flags. Maybe they look green to them, or maybe the mortgage guys aren’t wearing their glasses? Maybe they have canine eyes, and aliens swooped down at night to switch out their eyeballs? Dogs can’t distinguish colors between red and green. That’s the best explanation I have.
However, I did learn something new. There’s always a silver lining when you learn something new. Freddie Mac can now underwrite a file with a short sale after two years, providing the credit file is strong. If you’ve had a short sale on your record and want to buy a home in Sacramento, call Elizabeth Weintraub at 916.233.6759, Lyon Real Estate. We close our escrows for our own buyers who’ve had a short sale because we don’t refer you to bad mortgage lenders.
Taking Title as Wife and Husband When Homebuying
Bride and groom at reception discuss the good reasons to hold title as wife and husband when buying a home.
When I mention taking title as wife and husband when you’re buying a home; this is not meant to leave out anybody in the Sacramento LGBT Community. I know married people, for example, who refer to their coupling as husband and wife; yet others say husband and husband or wife and wife. There are few rules about what you can call your partner, unless you’re ticked off and intent upon sleeping on the sofa. But there are strict rules about ways to hold title to Sacramento real estate. Further, some married couples prefer taking title as wife and husband instead of husband and wife, regardless of gender.
Why does it have to be husband and wife? Is there any reason for the name of the male to be first on a grant deed? It’s just custom. Conformity. And it is definitely time to buck tradition a bit.
I am very cognizant of whether couples hold title as wife and husband when I take a listing, for example, because it also means making sure the wife signs first on every document, including the purchase agreement. In fact, my husband and I hold title as wife and husband, a practice put in place for our first home in Minneapolis. We did it for two reasons. One is so the solicitations for a new home mortgage and whatnot don’t bother my husband. They tend to mail to the first person on title. The other is to stir things up. To rebel against the norm. To say why not?
Corn Palace in Mitchell, South Dakota, is covered in corn.
When we sold our home in Minneapolis, right after 9/11, in the midst of closing concurrently in California, I was driving my vehicle out to Sacramento with an old friend when we stopped at the Corn Palace in South Dakota. It’s one of those weird things one is required to do by law when one is driving through South Dakota, just so you can say you have viewed the corn-struction in person. I was holding that former friend’s cellphone, trying to position myself “just so” in middle the street, in the exact spot where I could pick up a cell tower, as cars swerved to avoid hitting me right there in front of the God-awful Corn Palace, yakking to my husband about closing escrow.
He mentioned the escrow company mixed up the deed and put his name first. They forgot. Well, it wasn’t recorded yet. That escrow company in Sacramento needs to change the deed, I insisted, yelling into the cellphone and over the honking cars, as we are taking title as wife and husband, not husband and wife. Escrow was able to change it at the last minute and record the deed in accordance with our wishes. It shouldn’t be this difficult.
Let’s not even get to the subject of now I pronounce you . . .
Messing With Credit Reports When Homebuying Creates Chaos
Sacramento homebuyers checking credit reports while in escrow can spell disaster.
Well meaning Sacramento home buyers have messed up their credit reports to such an extent that we are now working on our third extension to close escrow. It’s not really the buyers’ fault. They are just doing what they believe is the right thing to do because either they were not informed or the communication delivered was unclear. Most normal buyers, if given the choice to screw up closing or close on time would choose to close on time. Unless they didn’t know any better. And if they didn’t know any better, I ask you, who is to blame?
I say it’s not the buyer. It’s also not the Sacramento listing agent, in case you’re wondering, because listing agents do not communicate with the buyer in a non-dual agency situation. That’s the job of the buyer’s agent and the buyer’s lender.
How Altering Credit Reports Can Create Disaster
The other problem is home buyers do not understand credit reports. They don’t know that when they close an account, for example, they could be affecting their FICO score. The score will probably go down. If their FICO score decreases, it could increase the interest rate they will pay. If the interest rate changes, that necessitates a new closing disclosure under TRID guidelines, put into place by the government last October. TRID overhauled everything you thought you knew about mortgages. A new closing disclosure delays closing.
To be safe, borrowers should never attempt to fix or update their credit reports without first speaking to a credit professional. What makes sense to regular person could be completely wrong. Credit is not simple. A credit professional such as your mortgage lender should be a guiding light for your home loan and can advise a borrower how to fix credit reports prior to obtaining a preapproval letter.
But once a home buyer is in contract to buy a home, all activity on that credit report should cease and desist. That means do not put any new purchases on a credit card. Do not close accounts. Do not dispute credit errors. Do not open new credit accounts. In short, do not touch your credit report.
In case you wonder, what’s the big deal? So what if escrow is delayed? Let me add that the seller is not required to close escrow after the period expires. In addition, if your interest rate goes up, a 1/4 point bump on a $300,000 loan means you will pay an additional $15,685.20 over the term of the loan. The safest thing to do is do not even look at your credit reports while you are in escrow. Don’t click. Fingers off the touchpad.
Top 3 Tips for Buying a Home in the Sacramento Spring Market
Following Elizabeth Weintraub’s 3 tips are likely to lead to buying a home in Sacramento.
Before I talk about my tips for buying home in the Sacramento spring market, let me say that the Elizabeth Weintraub Team, our small band of rabble-rousers, are shaking up the real estate market in Sac Metro this spring. We ranked #2 for the month of March among all Lyon Realtors, and we have about 1,000 agents. We might have had the same type of production for February, now that I pause. February was so long ago, though . . .
Our Sacramento real estate market is moving fast and furiously. This means when a buyer finds a home to buy, he or she should make an offer. Among the many tips for buying a home that you can find online, probably the first tip you will read is for the buyer’s agent to call the listing agent and ask: how many offers do you have?
Top 3 Tips for Buying a Home in Sacramento This Spring
In this market, among the best tips for buying a home a home that I can provide is pay list price or better. I see buyers trying to negotiate like this is 1999 instead of 2016. I’m not sure if their agents have been sleeping under a rock or if the buyers themselves never watch the news nor read a newspaper. This spring real estate market is made up of no sellers, too many buyers.
The second tip is do not assume the listing agent will not receive an offer by the time your agent submits an offer. Just because there are no offers on the table at the time your buyer’s agent calls does not mean a half dozen might not show up between then, later and after your offer arrives. Don’t base your offer on the state of affairs at the time you write it. Base that offer on the future. Put your best offer out there because you might not get another chance.
There is no law that says a seller must counter all of the offers through a multiple-offer situation. Sellers are free to choose just the one offer that meets all needs. Some do that just that.
The final of my tips for buying a home in Sacramento this spring, you may want to pass on the cobweb agent and consider a professional buyer’s agent. All agents are not equal. Choose your buyer’s agent based on the type of lawyer you would want on your side if you had to go to court. If you wouldn’t want that agent representing you in court, don’t choose that type of agent to write your offer. Find an experienced agent who is busy in this spring market, and you’ll go into escrow.
Call Elizabeth Weintraub at 916.233.6759. We serve four counties.
How to Count the Days in a Purchase Contract
You count the days in a purchase contract starting with zero for date of acceptance.
Do you know how to count the days in a a purchase contract? Well, you’ve come to the right place to find out. A performance issue came up this morning regarding the escrow timeline we use in California and how to count the days in a purchase contract for performance and contingency release due dates. The questioning agent was a 15-year broker in Sacramento who did not know how to count the days. She had taken a webinar online regarding the revised Residential Purchase Agreement — which is consistently being revised — and did not recall the “change.” I assured her that many real estate agents in Sacramento do not know how to count the days in a purchase contract. She is not alone, even though she works alone.
I tell you, if I ran a one-person brokerage company, which I do not, I would probably be networking like no tomorrow, attending every single S.A.R. meeting, hanging out with real estate lawyers, buying Starbucks gift cards to give away at closings; it’s tough to stay on top of what’s going on when you don’t have a designated broker doing that on your behalf. There are only so many hours in the day . . . but the secrets to my success are my alignment with the largest independently owned brokerage in Sacramento, Lyon Real Estate, and to hire a transaction coordinator who takes care of that stuff for me.
You don’t have to be an expert in everything if you surround yourself with experts.
Sure, I pay so much in TC fees every year that a person could probably live quite well on just the TC fees that my business alone generates. Some agents try to save those fees by doing all the paperwork themselves, and it takes so much time out of your day that you don’t have time to work on new business or monitor your own escrows. Penny wise and pound foolish in my book but to each their own . . ..
However, dull as it may seem to some, I do read the Residential Purchase Agreement. It’s like Yoda! It holds all of the answers to life’s secrets in Sacramento real estate. And, if you’re hung in here thus far, below is the answer about how to count the days.
How to Count the Days for Purchase Contract Performance Issues in California
The way you count the days in a purchase contract for contingency due dates is to first review paragraph 30, Item F, of the Residential Purchase Agreement. “Days” means calendar days. However, after acceptance, the last Day for performance of any act required by this Agreement (including close of escrow) shall not include any Saturday, Sunday, or legal holiday and shall instead be the next Day.
This means if you’re looking for the date to release the home inspections contingency, which by default is 17 days after offer acceptance, you would first count the first day, which is the day after contract acceptance, not the date of acceptance itself. If the final date falls on Saturday, that final date rolls to Monday. If Monday is a holiday, that final date rolls to Tuesday. I hope you have learned something new today about how to count the days for purchase contract performances.
If you’re looking for a top producer Sacramento Realtor, please call Elizabeth Weintraub at 916.233.6759.
