If you have been following me on twitter (@omsiguy) or on Facebook (http://www.facebook.com/#!/profile.php?id=1406307637)
then you have seen all of the updates coming out pertaining to the government and everything that it is trying to do.
Their road of reform is continuing in regards to the financial and mortgage market and some of it makes sense but most of it seems like a long shot to accomplish and implement. Bottom line is our government wants to dictate what, where, when, why and how the mortgage industry does what it does. The greed that ran throughout a few years ago was not just in the mortgage industry itself but also with investors and consumers as I have previously mentioned and now they want to jump in after the fact to say how we can conduct our business.
The main problem that I have is that the majority of the people involved do not understand what getting a mortgage is like for the average person or what providing a mortgage can all involve. As a result some of the changes that they want to make could make things increasingly difficult for consumers and for mortgage lenders of all type. What we could end up with is a small monopoly of players in the mortgage business that would and could control the bulk of things including where interest rates are set.
But lets see what all gets done and what constraints are placed....perhaps we will be lending money for mortgages and calling it soiled green.
Back to Home Buying.......
Now that your file is put together and obtained all of the information that is needed as well as picking the correct loan product to go with...it is time for underwriting. The lender would if they had not already updated the file and re ran an automated underwriting decision.
Once this was done the lender would submit the file to an actual underwriter with all of the supporting information so that they can review for approval based on the specific underwriting that a lender has in place. These overlays can be basic to extreme and may cause a loan that is approved on the automated system to not be approved.
After the underwriter has reviewed the file they may have some additional questions or requirements that are needed for the loan. This is not unusual in the lease. The questions or requirements could be very basic or complex dependent on what the file looks like and the constraints of the file and the loan program The lender wants to do the loan...but they want to make sure that they have everything covered to make sure that there are no issues down the road. Every T needs to be crossed. The title, appraisal and the actual credit portion of the file will be looked at closely.
The lender has a fiduciary obligation to protect you and themselves when approving the loan. This is why, especially in the last few years, they have become so much more picky. They are running the risk of buying the loan back from the investor if the file is not perfect in every way.
Now that your loan is approved...lets go buy a house.....(or complete the refinance).
I will start to go over a little of the home buying process and other items in the next blog.
There is so much information that I could share with you in these blog entries so please be sure to ask questions if need be.
Remember if you follow me on twitter or face book I provide a lot more information in relation to the mortgage and real estate industry.
Have a great week!
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