Recently my client accepted an offer on her parent’s 54-year-old house. I called the lender, who was from Wisconsin, to confirm he could write loans in Arizona and that the buyers were as well qualified as the buyer’s realtor had stated. Now, this lender will go unnamed but there was nothing but problems with this transaction.
The first issue was the appraisal. Since the crash of 2010 lenders can no longer use a particular appraiser. They contract with an appraisal company that sends one of their appraisers to the property. I put together the comps that should have been used by the appraiser. Instead, he picked a property that had been listed as having a pool which was actually a livestock watering tank. This is despite the description in the MLS and the pictures showing that it was not a pool. Luckily, we were able to get the appraiser to adjust the comp. Appraisers are not supposed to pay much attention to cosmetics like paint and flooring and should not let their likes and dislikes impact the appraisal. This appraiser hated the flooring and that some items were dated. Between the incorrect comp and the appraiser’s personal opinion, it screwed up the appraisal and cost both the buyers and seller money since the appraisal was less than contract.
The next issue was the lender requested a copy of the seller disclosure which has never happened in the twenty-one years I have been in real estate. This request was made directly to the buyers and the buyers’ realtor was not informed. The lender went through the disclosure and started asking for items to be fixed prior to close. This was not possible as the inspection period had passed. To add insult to injury after the first review the underwriter came up with more items on the second review. Finally, the issues were resolved with an addendum stating the buyers were ok with the condition of the property. Note to buyers: If a lender asks for anything other than financial documents please talk to your realtor before sending.
While everyone else was working hard to get the deal done the lender did nothing but put roadblocks in our way and cost the buyers and seller money. The bottom line is make sure the mortgage lender is not going to make buying a house harder than it has to be.