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View Full Version : Anyone else having trouble getting a mortgage??


curlyjbs
03-18-2008, 10:34 AM
Geez this is killing me. Our house is appraising sooooo LOW that we cant get enough money to do our addition. :mad: DH and I both have excellent credit (770 & 780) and have already been mortgage free for 3 years!!!! We have scrimped and saved and sacraficed to get where we are now financially and its all been for NOTHING!

I am sick! sorry, just needed to vent!
~Connie:sad2:

happily single
03-18-2008, 10:38 AM
You can thank all the people who financed homes they couldn't afford and thus they went into foreclosure or bankruptcy. From what I understand it is extremely dificult to get approved for everything, including studen loans. Have you tried the bank that you do all your banking with? Also I hear that credit unions are much more flexible in their requirements.

Good luck

DVCJEN
03-18-2008, 10:44 AM
I would try your local credit union. CUs are still making loans though some mortgage requirements have tightened.

curlyjbs
03-18-2008, 10:49 AM
It's not about what the bank requires, its the current housing market. It stinks! Houses arent worth anything anymore!

They'll only loan 80% of the current market value:sad2: - not enough for us to complete our work! Well, actually it will cover construction costs but that's it. I'll have a nice brand new kitchen, great room, livingroom, master bed & bath and 2 other bathrooms.....unfortunetly they'll just be shells. There's not enough money to finish them. Arggggh!

sigh
Connie

hdecker
03-18-2008, 10:56 AM
Sorry to hijack but we are having problems with the appraisal company. We are trying to get a loan to do some cosmetic remodeling. The mortgage is paid for free and clear. The appraiser came back to the mortgage company with this long laundry list of things that need to be fixed before they will release the appraisal. Um, everything on the list is the reason we are trying to get the loan - if we fix everything to the appraisers satisfaction we wouldn't need it. Anyone ever have this problem. WWYD - Thanks

curlyjbs
03-18-2008, 11:00 AM
Sorry to hijack but we are having problems with the appraisal company. We are trying to get a loan to do some cosmetic remodeling. The mortgage is paid for free and clear. The appraiser came back to the mortgage company with this long laundry list of things that need to be fixed before they will release the appraisal. Um, everything on the list is the reason we are trying to get the loan - if we fix everything to the appraisers satisfaction we wouldn't need it. Anyone ever have this problem. WWYD - Thanks

No problem with the hijacking...

The same problem here...the appraiser says the comps in the area are all remodeled etc and that's why our house is coming in so low. Well if we could afford to fix /update everything we wouldn't need the dang loan! What a load of crap.

~Connie

msmayor
03-18-2008, 11:01 AM
Are you trying to get only a home equity loan? A construction loan might probably work more in your favor.

You mentioned you are mortgage-free. With a construction loan, you should be able to borrow an amount based on the expected value of the house once the construction is complete. You will only get part of the money up front, and be subject to inspections by the bank to ensure you are on track, and additional monies released as construction progresses.

At the end of the process, you then convert the construction loan into regular mortgage financing based on the new value of the home.

curlyjbs
03-18-2008, 11:03 AM
Are you trying to get only a home equity loan? A construction loan might probably work more in your favor.

You mentioned you are mortgage-free. With a construction loan, you should be able to borrow an amount based on the expected value of the house once the construction is complete. You will only get part of the money up front, and be subject to inspections by the bank to ensure you are on track, and additional monies released as construction progresses.

At the end of the process, you then convert the construction loan into regular mortgage financing based on the new value of the home.

Does a construction loan have a fixed interest rate? I heard that kind of loan is a nightmare, but thanks for the suggestion. I'll look into it.

~Connie

HayGan
03-18-2008, 11:04 AM
Are you trying to get only a home equity loan? A construction loan might probably work more in your favor.

You mentioned you are mortgage-free. With a construction loan, you should be able to borrow an amount based on the expected value of the house once the construction is complete. You will only get part of the money up front, and be subject to inspections by the bank to ensure you are on track, and additional monies released as construction progresses.

At the end of the process, you then convert the construction loan into regular mortgage financing based on the new value of the home.

My DH is a mortgage broker and he would tell you that construction loans (in particular) are very difficult to get right now. Not only has the lending dried up but getting comps to justify the amount required just aren't there. With excess inventory in virtually every market and collapsing home prices, people just don't have the "equity" in their home that they had even a year ago.

Sorry, OP, but even despite your great credit the type of loan you are looking to get is going to be very difficult to get. I would suggest checking with your bank as well as a reputable broker in your area to see if there is anything they can do.

barkley
03-18-2008, 11:05 AM
It's not about what the bank requires, its the current housing market. It stinks! Houses arent worth anything anymore!

They'll only loan 80% of the current market value:sad2: - not enough for us to complete our work! Well, actually it will cover construction costs but that's it. I'll have a nice brand new kitchen, great room, livingroom, master bed & bath and 2 other bathrooms.....unfortunetly they'll just be shells. There's not enough money to finish them. Arggggh!

sigh
Connie

you've hit the nail on the head!

just last night i was reading an article in our former hometown newspaper and it was saying that in the san francisco bay area and outlying counties the last couple of month's sales are the lowest numbers in 20 year-and the median price for a home sold has dropped $100,000 in the past year:scared1:

since the appraisers have to look to the most recent comp sales it can result in a much lower amount a person can get a loan on.

i wonder how some of my former neighbor's are managing-several bought their homes outright and had planned on using their anticipated increases in equity to fund retirement. now some of them own homes that are worth a couple of hundred thousand less than they paid:sad2:

mickeyfan2
03-18-2008, 11:12 AM
Does a construction loan have a fixed interest rate? I heard that kind of loan is a nightmare, but thanks for the suggestion. I'll look into it.

~Connie

When we got our in the 90s it was a fixed rate loan. I am not sure about today. Everything is so different.

Are you trying to remodel your old home or build a completely new home and use the equity in your paid off home to build the new one?

Anjelica
03-18-2008, 11:12 AM
I guess we were "lucky" as we just took out a sizable equity loan to get some remodeling done. It was through our credit union where we have our mortgage. They did not need a new appraisal, etc. but that could be because we refinanced two years ago to get a lower interest rate and to change from 30 yr to 15 yr??:confused3

corndog
03-18-2008, 11:15 AM
We just did a refi. They only thing they looked as was our credit reports. They didn't care about income, money in the bank, and they didn't even do an appraisal on the house. Go figure.

curlyjbs
03-18-2008, 11:18 AM
My DH is a mortgage broker and he would tell you that construction loans (in particular) are very difficult to get right now. Not only has the lending dried up but getting comps to justify the amount required just aren't there. With excess inventory in virtually every market and collapsing home prices, people just don't have the "equity" in their home that they had even a year ago.

Sorry, OP, but even despite your great credit the type of loan you are looking to get is going to be very difficult to get. I would suggest checking with your bank as well as a reputable broker in your area to see if there is anything they can do.


We are dealing with our bank now. Believe it or not we dealt with a broker and walked away from our closing 3 weeks ago because the interest rate on the final paperwork was not what we were told originally 5.71% was what we were told all along but 6.625% was on the paperwork :confused3 . I'm regretting walking at this point because now i'm thinking it would have been better to have the darn money in hand now and refi later if the rates go lower. Stupid hindsight!

~Connie

shelly3girls
03-18-2008, 11:24 AM
Sorry to hijack but we are having problems with the appraisal company. We are trying to get a loan to do some cosmetic remodeling. The mortgage is paid for free and clear. The appraiser came back to the mortgage company with this long laundry list of things that need to be fixed before they will release the appraisal. Um, everything on the list is the reason we are trying to get the loan - if we fix everything to the appraisers satisfaction we wouldn't need it. Anyone ever have this problem. WWYD - Thanks

Have you considered a line of credit? The bank will loan up to a certain percentage of the value. Although the rate is floating, many allow you to lock into a fixed rate if you choose.

curlyjbs
03-18-2008, 11:34 AM
When we got our in the 90s it was a fixed rate loan. I am not sure about today. Everything is so different.

Are you trying to remodel your old home or build a completely new home and use the equity in your paid off home to build the new one?

addition/remodel

msmayor
03-18-2008, 11:34 AM
My DH is a mortgage broker and he would tell you that construction loans (in particular) are very difficult to get right now. Not only has the lending dried up but getting comps to justify the amount required just aren't there. With excess inventory in virtually every market and collapsing home prices, people just don't have the "equity" in their home that they had even a year ago.

Sorry, OP, but even despite your great credit the type of loan you are looking to get is going to be very difficult to get. I would suggest checking with your bank as well as a reputable broker in your area to see if there is anything they can do.

I don't disagree with your assessment, but thought it might be another avenue for financing the OP hadn't considered.

The credit crunch coupled with the downturn in the real estate market is going to make funding anything nowadays pretty tough.

breezy1077
03-18-2008, 12:02 PM
We are dealing with our bank now. Believe it or not we dealt with a broker and walked away from our closing 3 weeks ago because the interest rate on the final paperwork was not what we were told originally 5.71% was what we were told all along but 6.625% was on the paperwork :confused3 . I'm regretting walking at this point because now i'm thinking it would have been better to have the darn money in hand now and refi later if the rates go lower. Stupid hindsight!

~Connie

Approvals usually stay good for a long while and you can definately go back to the broker and can probably close in 1 to 2 days. FYI In this market, you'll probably make them very happy you went back to them so don't be afraid to do it.

breezy1077
03-18-2008, 12:11 PM
With your scores and the house being paid off, it sounds like the only hold up is the appraisal - not the value! The work that needs to be done sounds like that's whats making the bank hesitant.

with your scores you should be able to find some investor (you might want to go to a broker - they'll know which ones will do it) that only requires a "drive-by" appraisal (they don't need to go inside the house at all!).

Other than that you can look at a FHA rehab loan (I think it's a 203b). But, fyi, very few companies including banks are approved fha

Hope this helps! (by the way I'm sure the increase in rate was probably not a bait and switch ,but more than likely the rate they could get for doing loan, but they should have redisclosed this at least 24 hours prior to close) Regardless a rate in the 6's is not bad at all - please read my previous post and I'm sure this will all be resolved within 72 hrs.:)

KatheeME
03-18-2008, 12:14 PM
Thank the banks that gave all those sub prime mortages out! :mad:

Kathee

battricia
03-18-2008, 12:15 PM
I don't understand. With your mortgage being paid off you have 100% equity in the house right? Are you building an addition that's going to cost you 80% of what the house is worth? Or are you just not happy with the rates the banks are giving you? It doesn't make any sense to me unless your house is worth over 500k and you're trying to get an 80% loan.

tricia.

battricia
03-18-2008, 12:22 PM
I went back and reread and it does seem you're putting an addition on that is worth 80% of what your house is worth. To me that doesn't really seem smart. it will price your house out of the market in your area - being 'worth' almost double what most of the houses in your neighborhood are worth. I can understand why the bank doesn't want to loan this out.

breezy1077
03-18-2008, 12:24 PM
It's not about what the bank requires, its the current housing market. It stinks! Houses arent worth anything anymore!

They'll only loan 80% of the current market value:sad2: - not enough for us to complete our work! Well, actually it will cover construction costs but that's it. I'll have a nice brand new kitchen, great room, livingroom, master bed & bath and 2 other bathrooms.....unfortunetly they'll just be shells. There's not enough money to finish them. Arggggh!

sigh
Connie

I actually think the fha rehab loan is a 203k, and you should be able to go the lesser of "as is" value of property b4 rehab plus cost of rehab OR 110% of the expected market value upon completion. They're a pain in the "you know what to do" but it is a viable option. Fyi fha rates are in the 5's right now. :thumbsup2

gower525
03-18-2008, 12:34 PM
I am about to have to refinance to buy out my soon to be ex-husband. This is all good news for me - right? I want the house to appraise as low as possible so I don't have to pay him as much. I will have to take out some equity to buy him out. I have very good credit - so I thought I would have no problems taking out some equity to buy him out. Perhaps I have thought wrong.

dumboiu
03-18-2008, 12:40 PM
You can thank all the people who financed homes they couldn't afford and thus they went into foreclosure or bankruptcy.
what about thanking the lenders who backed the mortgages to those people who couldn't afford them?

msmayor
03-18-2008, 12:41 PM
I am about to have to refinance to buy out my soon to be ex-husband. This is all good news for me - right? I want the house to appraise as low as possible so I don't have to pay him as much. I will have to take out some equity to buy him out. I have very good credit - so I thought I would have no problems taking out some equity to buy him out. Perhaps I have thought wrong.

Depends on how much equity is there and how much ready cash you already have to make the buyout. Let's say for example your house is worth $200k and is already mortgaged for $150K, and you need to pay him $100K, you'd need close to $70K in ready cash outside of the equity to fully pay him since you'd probably only be able to refinance for up to $180k, $30k more than you have now.

The less your house is worth, the less equity you have available to make the buyout. Double-edged sword, actually.

breezy1077
03-18-2008, 12:58 PM
Thank the banks that gave all those sub prime mortages out! :mad:

Kathee

The consumer has the entire loan process and then has three recission days to "think twice about it". Our country has resorted to the blame game and loves to play "victim". Don't forget, not all sub-prime loans were bad and afforded many people the opportunity to become homeowners that might otherwise not be able to do so. Let's also not forget that even in the worst areas (before the mortgage meltdown), 97% of loans (incl. subprime) were performing - an A+ rating where I come from. Anyway...just something to consider... :)

Anjelica
03-18-2008, 01:32 PM
The consumer has the entire loan process and then has three recission days to "think twice about it". Our country has resorted to the blame game and loves to play "victim". Don't forget, not all sub-prime loans were bad and afforded many people the opportunity to become homeowners that might otherwise not be able to do so. Let's also not forget that even in the worst areas (before the mortgage meltdown), 97% of loans (incl. subprime) were performing - an A+ rating where I come from. Anyway...just something to consider... :)

I guess I have to digress a little here. Even if only 97% were performing an A+ rating what about the other 3% that were not. While 97% in school would be an A I don't think thats fair to apply that in this instance. Say you have 50 million homes in America and 3% are foreclosed - that's 1.5million homes that have defaulted. I think that is a pretty huge number considering many towns don't have thousands of homes.

breezy1077
03-18-2008, 03:26 PM
I guess I have to digress a little here. Even if only 97% were performing an A+ rating what about the other 3% that were not. While 97% in school would be an A I don't think thats fair to apply that in this instance. Say you have 50 million homes in America and 3% are foreclosed - that's 1.5million homes that have defaulted. I think that is a pretty huge number considering many towns don't have thousands of homes.

I agree with you...and the 97% means nothing to the person in the 3% category. But, only a fraction of the 3% are due to a "bad" loan. More often than not the cause is loss of job, death of spouse, or medical reason.