I wrote this a couple weeks ago, before we closed so I wouldn’t jinx the process. The process of mortgage underwriting is completely f*cked up at this point. This post is some of the zaniness I had to endure.
The last house I bought, in Chandler Arizona was a breeze. We bought it in 2012 (i.e. well after the global financial crisis), and apart from documenting my wages, and supplying some paperwork about our house in Tucson that we were keeping and renting, it was a relatively painless process. That is not to say that we didn’t have some hoops to jump through, but they were easy, and quickly dispatched.
The loan we got here is a whole other story. Granted, we are borrowing the maximum allowed for a conforming loan. But it is a standard 30 year, fixed rate mortgage (that we locked in at 3.56%) I make plenty of money to qualify and repay the mortgage, and we are putting 10% down, a considerable amount of cash, so it seems like it should have been an easy process.
Nope. The wrinkle is that we are selling our Tucson house, (it is under contract, but it will close after we close here in San Jose) and that bears on the total debt ratio. So it was an unending stream of requests for documentation, and justifications for everything in the package. My relocation letter wasn’t good enough. My 4 pay stubs with my salary weren’t enough. My promotion letter with my new salary on it wasn’t enough.
We supplied the insurance policy information three times for Christ’s sake.
A few things that really got stuck in my craw:
- The Tucson house HOA. They insisted on a printout from a secure website that showed the dues, and the payment schedule. Of course, the rinky-dink HOA was run by a rinky dink company that didn’t have a secure website, or really anything that was acceptable. All for a HOA fee of $45 every quarter. Yes, that’s right, $15 a month.
- The transfer of funds when we closed a bank account. Upon moving here, the bank we used in Arizona, BBVA Compass, was not going to work for us. With only two branches int he bay area, neither within 20 miles of our house, we changed banks. So on December 23, we closed the BBVA account, and Barbara got a cashier’s check for the funds there (something north of $42K). The teller made a mistake and made the cashier’s check a little less than the total. The difference, $2.18, he just paid in cash. It took 3 hours over three days to satisfy the underwriter of this $2.18 discrepancy. I burned about $200 worth of work time to account for the price of a tall regular coffee from Starbucks.
- The mortgage company uses a portal to communicate the status. mortgageloanstatus.com that seems to be a common portal. It started relevant with a lot of documents that I needed to sign, and return. But also is a panel to explain the needed items to clear. The problem is that they never updated it as we cleared the documents. Useless as tits on a boar hog.
Look, I get it that the fast and loose times that lead to the crash in 2008 were bad, and that we need to tighten the process up, but the mindless drones, questioning $15 HOA fees, and $2.18 discrepancies in a transaction of over $42,000, well, fuck me.
I am also certain that the required mortgage company that we needed to use due to the relocation company was part of the problem. They were located in New Jersey, and the time differential (3 hours) didn’t help. Add in the nuttiness of the California market, where you have to act fast, and process it immediately. They never picked up the sense of urgency that is demanded to win here.
The process is done, the loan was approved, and funded, and we have the house. Next up will be the before post with plenty of pictures of what we will be changing before we move in.
I can hardly wait to get out of the apartment. Our formal move-out day will likely be March 31. I will hate to pay the termination fee on the lease, but I would hate even more to have the mortgage AND the rent.