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Very detailed mortgage looks now required
Old 02-29-2008, 08:44 AM   #1
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Very detailed mortgage looks now required

I recently bought another rental property in Northern VA. I chose Wachovia as the lender due to their attractive rates.

As part of underwiriting, I was expecting to be asked for my leases and I was.

The next question was unexpected, they asked me to provide bank statements showing depositis that matched the rents in the lease. I highlighted the statements and sent them along.

1 day before closing I was asked for copies of the checks from my renters. I dont keep those, which significantly raised my stress level. I had to get on a 3 way call with my bank (BoA), while Wachovia and BoA went line by line through my deposits and looked at the signer on the check.

I.E. A check in the amount specified on the lease, signed by the person identified on the lease, was actually deposited to my account.

things are different now. Clsoing the barn door well after the horse has left...
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Old 02-29-2008, 08:54 AM   #2
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I've never heard of a lender being so thorough, however I see it as being a good thing, as hopefully it will prevent a similar mess to the current sub prime disaster playing out any time in the future.
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Old 02-29-2008, 09:47 PM   #3
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FWIW, I can look at images (front and back) of checks deposited with BofA's online banking. These are checks deposited into thier newish ATMs which also provide an image of the check on the receipt.

I agree its good that things are being reviewed carefully. Not so good that this came as a surprise...it seems to me they should have just provided you with a list of required docs to keep your stress level low....Good luck with those properties. Im sniffing around suburban MD, but just a looky lou.
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Old 02-29-2008, 10:29 PM   #4
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Quote:
Originally Posted by DangerMouse View Post
I've never heard of a lender being so thorough, however I see it as being a good thing, as hopefully it will prevent a similar mess to the current sub prime disaster playing out any time in the future.
I agree and it will also make it more difficult for someone to sell a home.
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Old 03-01-2008, 03:22 AM   #5
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I remember in the 80's getting commercial development loans on small properties north of Manhattan with my brother. Both raw subdividable land and spec properties. All one-on-one relationships with our local bankers. You built up that relationship and trust basically one project at a time. Every meeting was in person and always ended with family conversation and a handshake. Even visits to the sites. Same with our personal homes. It was also the day when most small RE investors could do just about every job a subcontractor could do, from running a backhoe loader to installing a kitchen. Change is inevitable but I honestly miss those days.

Man, I sound like my elders (back when we were kids we had to ....... )
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Old 03-01-2008, 05:06 AM   #6
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I guess the days of the "no doc" mortgages are over

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Old 03-01-2008, 09:21 AM   #7
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I trust you also reviewed their documents as thoroughly.

My DD recently purchased and remodeled a home. Being the nervous Nellie that I am I asked about her mortgage. She told me not to worry, she read every page. I trust she understood them too as she is a CPA.
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Old 03-01-2008, 10:23 AM   #8
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i remember in the 1990's everyone used to say getting a mortgage was hard, you had to document everything, the bank would check, they would make a last minute credit check so you weren't supposed to open any new lines, variable rate mortgages were for the real subprime and rich people mortgages or bridge loans

reversion to the mean
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Old 03-01-2008, 12:20 PM   #9
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Somewhere I read that this was in the Countrywide 10k:

Quote:
Our financial condition and results of operations could be negatively impacted to the extent we rely on customer information that is not complete or accurate.
In effect, 'buyer beware' rather than 'we did our homework'.

Glad to see things coming back around!
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