Missed Deadlines and Your Mortgage…

Allison Gervais

The unbelievable story of what happens to your mortage closing when the bank misses its own deadlines! A loan is expected to fund and I’m supposed to get fully compensated for my work.  Neither happened on this day. 

When I tell you why, I hope you are as shocked as I am. 

by Allison Gervais

First let me share something. Being a mortgage broker is like being a middle person between two stressed out teams, the borrower and the bank.  You have to give all the good and (lately a lot of bad) news to the clients.  You also work hard to satisfy bank underwriters who are underpaid, and sometimes nervous to sign their name on approvals.

What Happens When the Bank Doesn’t Make Its Own Deadline?

Banks send lists of items needed to get a loan closed.  These days, lists are 2-3 times as long as in the past.

We were on schedule to close my borrower’s loan at an outstanding interest rate.  The very last task was for the bank to make a simple 5 minute phone call to ask if the borrower was still employed, yes or no answer.  Easy, right? 

In order for this loan to close with the stated interest rate, the bank had to finish their tasks by an 11:00 a.m. deadline.  But guess what, they  finished this task at 11:49am.

And because it was 49 minutes late…
 they took away the lower interest rate!

My office made the same phone call for our records in less than 10 minutes. The borrower had signed the loan papers 2 business days after receiving them.  The bank had the loan documents back on December 23 but couldn’t complete a 10 minute phone call by 11:00am on December 28. 

Ugly Options:  Cancel, Pass or Cover

As the Mortgage Broker, I was given the option to cancel the loan all together, pass the increased fee onto my borrower, or cover the increased cost of $1565 from the original agreement to honor the loan and interest rate for my client.  Needless to say, I kept my borrower out of as much of the drama as possible and his original rate has been honored by my company.    

A generous number of mortgage brokers have left the business because the earnings decreased, we are buried in additional paperwork, and stress has increased with situations like the aforementioned, plus tighter loan guidelines and new federal laws (which I’ll be addressing in a future article). 

So the next time your loan officer calls you to rush signing or faxing documents, don’t think it’s because we’re nuts, dropped the ball or enjoy annoying our clients.  The mortgage brokers still standing are dedicated to the business and on your side.

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Tags: family, highlight, Home, Money, Real Estate

Category: Real Estate