Is there any contract or anything where a mortgage company employee says that the mortgage was approved by an underwriter & the home will definitely close? When there is no closing and the employee must have lied about the approval, what can be done if anything?
2007-06-27 05:19:53 · 10 answers · asked by memyselfi 2 in Business & Finance ➔ Renting & Real Estate
I do have this on my phone messages. The approval is a taped message on my phone from the mortgage company employee.
2007-06-27 05:20:56 · update #1
Any mortgage lender reserves the right to change approval to denial right up until the last moment before closing. The fact that the buyer was approved does not mean the buyer is STILL approved.
Most lenders will run a final credit check shortly before closing to insure that the credit check they had previously done has not changed substantially, and also will get a last minute job/income verification statement from any employer(s).
As a real estate broker, I've seen financing pulled on the day prior to scheduled close, simply because the buyer was rather stupid and went out and charged a credit card or two for a pile of new furniture for their new house.
2007-06-27 09:07:37 · answer #1 · answered by acermill 7 · 0⤊ 0⤋
Approvals are not that useful. They just mean someone (maybe a mortgage broker trying to get a commission) thought they could get a loan for the applicant (if they were wrong - too bad, they just made a mistake). Don't assume the employee was lying they may have actually been approved but (again) whoever approved them was wrong. Put another way an approval shows that someone (a lender or mortgage broker) thought they could find a loan for the applicant but if they (the lender or broker) was wrong there is really nothing you can do about it.
What you need to do in the future is get the applicants financial info for yourself when they put in a contract and decide for yourself if they can afford the loan. Then go check the applicants info and credit (call references, if there is still doubt in your mind if they can get a loan then make sure the application allows you to pull their credit and go pull it) yourself. The other option is if the financial info the applicant submits seems ok and you don't think they are deceiving you, then give them some time 30-45 days to get the loan. If they don't get it just cancel the contract and move on, but stay in contact with the applicant and their lender the whole time to monitor for problems.
Note, if you have a good real estate agent they should be doinng some of this themselves - thats one of the things they are paid for.
2007-06-27 05:35:52 · answer #2 · answered by Slumlord 7 · 0⤊ 0⤋
As the seller I highly doubt you can go after the mortgage company. A mortgage company can pretty much approve any loan. The approval will come with conditions. The mortgage company cant tell you those conditions. Lets say for example. The underwriter approves the mortgage based on these 3 conditions.
1. Borrower shows 3,500 a month
2. Appraiser to address this question
3. Borrower to pay off 20,000 judgement.
Are the borrowers approved? Absolutely. When the loan officer talked to you about the approval thats all he/she could say legally. The loan officer cant go into conditions of the approval with you. Hell they dont even have to tell you if they are approved.
At best the loan officer told you too much, at worse the only person he is obligated to is the borrower. I could see why the borrower might sue him for telling you anything without permission. Im not an attorney but I dont see how you can sue the mortgage company, I could see a case for the borrower to sue the mortgage company.
Sorry it turned out this way. I dont see what you can do. Call a couple attorneys.
2007-06-27 05:30:53 · answer #3 · answered by financing_loans 6 · 0⤊ 0⤋
I'm guessing my your screen name that you live in Ohio. I just bought a house in Columbus 6 months ago. After your seller made the offer and you accepted it (which all should have been done in writing) your house would have gone into contract. On that contract would have been the scheduled closing date. After the financing approval comes the home inspection and the Mortgage company send out an appraiser to determine the homes value. All of this has to happen within a set amount of time (according to Ohio law) and the closing date should be stated on the contract and on the written offer from the buyer. Check your contract or ask you seller's agent.
We made the offer on our house at the end of November be didn't schecule the closing until mid to late Janurary because of the holidays and other things. If you don't have anything on paper you there's nothing that can be done. Each step of the home buying process has a different piece of paper attached to it. Make sure you keep every scrap you are given.
If you had your home for "sale by owner" and you didn't get anything in writing from your buyer then you aren't bound to them. I would suggest listing your house with a seller's agent who knows the process and has many contact among buyer's agents.
Edit: Most of what Venicefloridarealtor said also applies in Ohio.
2007-06-27 05:53:03 · answer #4 · answered by Anonymous · 0⤊ 0⤋
You should have had something in the purchase contract regarding getting the lender approval in writing within a certain period of time. This is standard in Florida - not sure what state you are in - but check your contract, and check with your Realtor. He/she should have made sure this happened for you.
If you are not working with a Realtor, check your contract. Not having a lender commitment in writing within a certain time frame may void the contract. Also, the inability for the buyer to get financing (regardless of any voicemail messages to the contrary) may void the contract.
Is there a closing date set forth in the contract? Have you passed that date already? What does the buyer default section say on that?
Do you have a good faith deposit? Again, check the contract to see what that means for you.
If you still want to make this deal go forward, ask the lender for a commitment letter, ASAP.
The lender can make a commitment to giving a loan to a buyer, but a lender can NOT guarantee that a particular deal will close.
Read your contract carefully and make sure that you understand your rights and what is required of the buyer - and when.
Good luck and best wishes.
2007-06-27 05:36:54 · answer #5 · answered by venicefloridarealtor 4 · 0⤊ 0⤋
Im a little confused as to why you need to wait until the car payments are paid. Always assume you will have one regardless or not when you determine if you can afford a house or not or how much of one. you should not spend more than 30% of your gross income into a monthly mortgage payment So if you and wife make 200,000 a year..your mortgage should be no more than 5000 a month., All your debt combined including mortgage should not be more than 41% of your gross income. my point is even if you do pay off your car loan, wouldnt you have to assume that you will have another in a another couple years? your still going to have a mortgage payment in that time frame as well.. Now if you have credit card debt.. I would pay all that off first. One it will raise your score (paying off a cal loan likely will not) and two that is spending that you dont need. and to answer your question, no you cant defer payments. Once you close on a house..your payments will start. It usually takes 45 days from the time you sign the loan documents to close.
2016-05-17 12:28:55 · answer #6 · answered by ? 3 · 0⤊ 0⤋
Just because they have been approved doesn't mean it will close.
They may need more info from the buyer.
The lender has to do home inspection and appraisels.
Just because the buyer was approved doesn't mean that they have done a full financial check on them. You can be approved and still run in to all kinds of little problems that have to be explained to the lende.
Hang in there , it took us three weeks longer than it was suppose to.
2007-06-27 05:31:19 · answer #7 · answered by Kat 2 · 0⤊ 0⤋
A preapproval can still mean there are conditions remaining to get a full approval. Hard to know what exactly you were told.
But, if it never closes, you could file a complaint with your state department of real estate or commerce or banking, whichever agency regulates mortgage companies in your state. They might pursue some action for incompetence or something else. I've seen it happen.
2007-06-27 06:51:51 · answer #8 · answered by Yanswersmonitorsarenazis 5 · 0⤊ 0⤋
If it's not in writing, it's completely meaningless.
Also, what's the harm here? Did you take action based on his statement?
With these kind of legal issues anything that isn't signed and sealed should be treated as if it hasn't happened yet.
2007-06-27 05:27:22 · answer #9 · answered by jargent100 5 · 0⤊ 0⤋
Consult an attorney.
2007-06-27 06:00:48 · answer #10 · answered by Juliu C 6 · 0⤊ 0⤋