Tuesday, April 5, 2011

Loan Officer Hell

I wrote before that there was a sacred trust between the person handling your mortgage and yourself. If you can't trust that person, then the whole process is going to be frustrating and to be quite frank, a pain in the ass. To further highlight this lesson, let me discuss what has been happening the last few days.

Our loan officer (L.O. from here on out) told us a couple weeks ago that the rest of our down payment, plus our closing costs would come out to a whopping $1200. Wee! That's great! Way less than we thought it'd be! But still, we were wary. The underwriter made some noise about wanting a specific amount in the account and our L.O. relayed on Friday that that amount would be $2800. Ok. We couldn't figure out why we needed $2800 when we owed $1200, and the best the L.O. could tell us is that sometimes they want a "reserve" of about two months worth of payments in the bank. So, whatever. We can deal.

Then Monday rolls along and we get the official approval back from the underwriter (yay!) but! He wants $3160 in our account. Now, while I feel that we have adequately prepared for this kind of scenario, being told two vastly different numbers in the course of 3 days is intensely frustrating, and if the L.O. wasn't confident in the first figure, he should have either expressly explained that it was just an estimate and in that case gave a worst-case scenario, or rather yet, kept his trap shut and waited until the underwriter came back.

My lovely husband, who is dealing with the L.O. for me because I can no longer maintain civility, expresses these frustrations and the L.O. promises up and down he will fix the issue. I'm still not satisfied, so I called his supervisor, who then calls our buyer's agent (whom he's friends with) and the L.O. to let them know what was what and that we were considering going with a new loan officer. This resulted in a slew of calls, the most annoying from the L.O. himself who called from the Oriole's Opening Day game, making it nearly impossible to hear him and after talking to me he called Steven, LITERALLY three times in a row until he answered to give the same platitudes he was trying to feed to me.

To interject -- we've been working with the L.O. for almost three months now, and he still pronounces Steven's last name wrong. This bothers me and I feel, is highly unprofessional. When you're working for someone, just a basic courtesy is to get their name right. But anyways....

Even our buyer's agent called and tried to convince us to give him a few more days, because by all accounts the loan itself is very tightly done and was done in a lot less time than expected.

Of course, if anyone in this situation bothered to listen, they would have understood that I just wanted options for what I could and couldn't do given that we close in less than a month. We had already decided we would get the L.O. until close of business today to get these issues situated.

So everything was honkey dorey. I was still unhappy with the L.O., but fine...I decided to give him one last shot. After all, third time's a charm...right?

No. It's not.

Turns out that $1200 the L.O. initially estimated for our closing costs + down payment remaining balance was grossly wrong. Despite iterating multiple times that we had 4% seller contributions he still calculated 6% into his estimates, coming up with that $1200 figure. So, the $3160 that the underwriter was looking for wasn't for a "reserve" in the bank-- no, it was for $2000 more in closing costs.

While I expected last minute, costly expenses to pop up, $2000 extra is ridiculous. Because we're not ones to sit idle and let a bank screw us over, through some haggling and intrepid adventures through the interwebs, we have managed to slice it down almost by a half, but most of that was by us finding deals on homeowner's insurance (my original topic for today) and by explaining for about the fifth time to the L.O. that our settlement costs are $200 less than originally quoted. The L.O. did manage to get us a discount of about $240, but to be honest, these would have been fees we would have negotiated down no matter what.

It's difficult to express how livid I am about this whole situation, and how out of control I feel. (And I'm keeping it in the singular here because I'm well aware that while Steven is just as angry, he maintains a much lower level of constant frustration.) There is no recourse for us but to switch L.Os, and even then, there's no guarantee that the next will be any better. And really, it all boils down to communication, listening and respect. If our L.O. had just listened when we talked to him, none of the disagreements would have happened and we would be better prepared for our closing. As is, I'm just thankful we over-saved because otherwise we wouldn't be able to close, given that we're beyond the thirty day period requirement for a loan from family for closing costs.

So a tip to all of you home buyers: if your L.O. is not communicating, seems unsure about any point in the process, or is a jerk about anything, switch to a different L.O.. Sometimes this can cause delays, and it sure is a pain, but the stress that our current L.O. is giving us with this situation is 15 times what it would have been if we had switched before the first argument when we started to get the feeling that he wasn't the best of the best, la creme de la creme if you will.

Our next post will be on negotiating insurance to for some bonus savings!

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