Taking back a pre-approval?

posted 2 years ago in Home
Post # 2
Member
2580 posts
Sugar bee

Our mortgage broker basically told us that bank preapprovals don’t mean you will actually get approved. He told us he has seen many people get pre approved, pick a house, put in an offer , and then find out they actually are not approved or approved for a lot less.

Post # 3
Member
812 posts
Busy bee

Yes. We went through the exact same thing with CHASE. Fortunately, our mortgage rep was amazing and referred us to another mortgage rep through UMPQUA bank. 

I was so freaked about it not going through again, that my Real Estate agent, who was a broker, said she’d get it approved one way or another. But my fear was unfounded and UMPQUA came through with flying colors. Mind you, all this happened after our offer was accepted. 

Apparently this is quite common in the real estate world. Try somebody else. It’ll work out. 

Post # 4
Member
1424 posts
Bumble bee

The whole process is very nerve racking and nothing is really approved until you sign on the dotted lines to close on the home. There is a reason they set closing dates about a month or so out from when you make an offer – because it takes that long or longer to get the financing all put together.

But – There are likely other loan options if you can’t get the loan you were planning through your bank. You may need to go to a different bank or different mortgage company.

Post # 6
Member
1679 posts
Bumble bee
  • Wedding: October 2013

as PP’s have said, unfortunately pre approvals don’t mean much. We had a really tough time closing our loan because they kept asking for more documents for us, one piece at a time. It was so aggravating.

If your current lender can not approve you, go somewhere else! 

ETA- just saw your reply. Do you have a US Bank near you? They have (at least they did when we bought) a first time homebuyers program were you only have to put 3.5% down and they self insure, so no PMI. Might be worth looking into to.

Post # 7
Member
2580 posts
Sugar bee

 

kb7:  

We had a similar situation my FI makes a base salary and job bonus. Our mortage broker put his income down as significantly less than he makes.

The figure he used was close to what my FI had already made that year ( We were getting approved in July) so bascially half of what he made. He said that the banks don’t like to speculate what your going to make. A month later he was already at the figure our broker put down as the whole year.

We got approved for our house that we wanted on that figure but if we didn’t I would have been pissed seeing as he put us down as making half of what we actually do.

They also did not use my bonus check because it is not guarenteed money according to them.

Post # 10
Member
1242 posts
Bumble bee
  • Wedding: August 2015

 

kb7:  I’m a mortgage processor and we see this all the time. Once a “pre approved” loan gets to me, I have to double check literally EVERYTHING and I usually find alot of mistakes, especially with how the loan officer calculated the income. Unfortunatley, they can take the pre approval back if the underwriter/processor finds mistakes, making it no longer approved within the guidelines. Every time I see this I want to lose it on the loan officer for making our members go through this, granted there are other steps that could be taken so this doesn’t happen- but they’re not.

I dont see how this can make THAT much of a difference though if the home your purchasing has a monthly payment of HALF of what you were approved for.

Good luck! I hope you guys get everything figured out!

Post # 11
Member
2580 posts
Sugar bee

 

kb7: 

I don’t know about the states because I live in Canada but right now you basically have to have great credit, make very good money, or have a huge down payment ( and good credit as well) to get approved right now especially for first time buyers.

My FI has a work buddy that makes the same amount he does north of 100,000 and because his wife works as a hair dresser ( mostly cash job which is hard to prove income) they didn’t get approved.

I have a few clients that their wives sell houses and they say they have lots of clients but very few that actually have approvals.

 

Post # 12
Member
2791 posts
Sugar bee
  • Wedding: May 2015 - Walnut Hill Bed & Breakfast

My sister-in-law-to-be had a similar issue… I don’t know all the details but they (the morgage broker) overlooked something and it ended up that they needed to pay off one of her student loans to get to to be approved. She didn’t find out until the date they were supposed to close! Luckily they were able to scramble and pay off the loan they needed to (not sure if they had help). You certainly are not the only one!

Post # 13
Member
3756 posts
Honey bee
  • Wedding: April 2014

The pre-approval is such a waste of time, it really meant nothing for us. When we actually put in the application and went into under-writing it was a whole different story. 

Post # 15
Member
1242 posts
Bumble bee
  • Wedding: August 2015

 

kb7:  Doesn’t surprise me. Same thing happens where I’m at because a company doesn’t want it getting out that their loan officers don’t know what they’re doing. Are they trying to work with you to make it work? If not, threaten to go elsewhere. Most companies will work with you more if they may loose your business.

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