Author Topic: Mortgage pre-approval process: a little surprised  (Read 1878 times)

ysette9

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Mortgage pre-approval process: a little surprised
« on: April 05, 2017, 04:55:47 PM »
We are going the rough the process of getting pre-approved for a mortgage through a couple of different institutions. I just answered an email from one loan officer that raised my eyebrows.

First, the estimate came back at a purchase price of 7x our annual household salary. That is beyond ridiculous. I politely said that we were looking to get pre-approved for 3.9x. The second surprise was when this person said that they like to see at least three "tradelines" for each borrower (i.e. credit card, car loan, student loan, etc.) and we only had three between the two of us. The email went on to say that they should be able to make an exception due to our stellar credit. I found myself trying to figure out how to say that we don't like carrying around a bunch of debt and hopefully that won't be a problem b/c we only want to borrow half of what you are offering us..... weird

Scortius

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Re: Mortgage pre-approval process: a little surprised
« Reply #1 on: April 05, 2017, 05:05:34 PM »
Oh boy... we're about to go through this process too, and it sounds like we're in similar situations.  I can't wait to report back...

Drifterrider

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Re: Mortgage pre-approval process: a little surprised
« Reply #2 on: April 06, 2017, 06:20:22 AM »
I never asked for "pre" approval based on a formula, I asked at a specific dollar amount.  That is the amount, coupled with my cash for a down payment and closing, I would be willing to spend.

On my last one (I ended up not buying the house after an inspection) the lender called to tell me they would be happy to loan me $$$$$$$$$$$$.  I only wanted $35,000.

From them "but you qualify for so much more".

From me  "I do, because I don't".


lizzzi

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Re: Mortgage pre-approval process: a little surprised
« Reply #3 on: April 06, 2017, 07:26:03 AM »
Yes, I've been there, too. The lender raises her eyebrows and says, "But Lizzzi, you qualify for twice the amount you want to spend!" Yeah, right. I always felt like I wanted to own my house, not have the house (and the bank) own me.

neo von retorch

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Re: Mortgage pre-approval process: a little surprised
« Reply #4 on: April 06, 2017, 07:33:10 AM »
Banks are businesses, and loans are their products. The people you are talking to are basically sales people. For someone with good credit, the sky's the limit, as far as they are concerned. The more of their product you buy, the more profitable it is for them.

patchyfacialhair

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Re: Mortgage pre-approval process: a little surprised
« Reply #5 on: April 06, 2017, 07:49:56 AM »
Interesting...maybe I had a unicorn loan officer, but she didn't even tell us, on purpose, how much we were approved for.

We told her how much the offer was, then asked for a pre-approval letter so our realtor could provide that to the listing agent. We had to call her back because she listed the max we were approved for, not the asking price of the home, like we asked.

There was zero discussion to get us to spend more money (we did that on our own, but that's a different story).

HAL9000

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Re: Mortgage pre-approval process: a little surprised
« Reply #6 on: April 06, 2017, 09:03:23 AM »
First, the estimate came back at a purchase price of 7x our annual household salary.

Another flag for Bubble 2.0

ysette9

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Re: Mortgage pre-approval process: a little surprised
« Reply #7 on: April 06, 2017, 10:06:54 AM »
I found myself wondering exactly the same thing about bubble. Maybe the risk profile is different in the super jumbo market? I didn't even realize there was such a term as "super jumbo" until recently.

Interestingly, two banks asked for me to submit an amount I wanted to be approved for and the other just had me submit my info and told me that max they would go.