Are my buyers for real?!?!? (Oyster Bay: mortgage, bad credit, loans)

[jamibit]

Seriously, I thought I would go crazy if I had to wait until the last minute for my buyers to get ther mortgage commitment but now, they want a week extension!! I'm told by my lawyer and everyone else that's involved that this is common, but really, they've had 45 days! Is it too much to ask to do things on time? They said the bank was taken over by another bank but I can't help to think that they might be stalling for some other reason. I managed to get my commitment on the house I'm buying within 2 weeks so what takes so long!!!

Has anyone ever experienced something like this and am I wrong to worry about it???

[TomMoser]

Yes, it is worrisome if they can't get their commitment within the stated time. How strong are they as borrowers? Are they making a substantial down payment?

[jamibit]

Yes, they are putting 20% down which is why I wasn't so worried, just ancy. And then now with this extension, I'm beside myself. I even went on google to see if any banks were bought out in the past week or so but couldn't find anything.

[TomMoser]

20% down would make me more comfortable, too. But, these days you never know. I would find out what bank they are using and have your agent or lawyer call up the loan officer directly to find out what is going on.

[totallyfrazzled]

And people wonder why they should bother getting pre-APPROVED. This is a great illustration of why! Had they gone for a pre-APPROVAL, all the bank would have had to do was make sure the house appraised.

Putting only 20% down is considered 'strong' these days? *gag* I thought people were supposed to be learning from the current mortgage mess. Sorry but IMHO you're not a 'strong' buyer unless you're putting down 50% or more.

If putting only 20% down is considered 'strong', what the heck is considered 'average'? Five percent? Ten??

Oh well, I guess most people have a higher tolerance for debt than we do.

[TomMoser]

Pre-approvals are a great thing. I wish more people would get them.

20% down isn't the strongest (I would much rather see a suitcase full of cash), but it certainly is acceptable as it usually indicates that the person is financially disciplined and a good candidate for a loan. Of course there are many other factors that go into it.

[L-88]

Perhaps the buyers are having problems getting the loan...bad credit history...not enough income to be able to float the loan. Banks have become very skittish to whom they lend money these days...especially home loans.

[GigiBowman]

Originally Posted by totallyfrazzled

And people wonder why they should bother getting pre-APPROVED. This is a great illustration of why! Had they gone for a pre-APPROVAL, all the bank would have had to do was make sure the house appraised.

Putting only 20% down is considered 'strong' these days? *gag* I thought people were supposed to be learning from the current mortgage mess. Sorry but IMHO you're not a 'strong' buyer unless you're putting down 50% or more.

If putting only 20% down is considered 'strong', what the heck is considered 'average'? Five percent? Ten??

Oh well, I guess most people have a higher tolerance for debt than we do.

When are you going to find a house already? lol....want to buy a house in Oyster Bay that I just listed? Please bring your suitcase full of cash! lol

[jamibit]

This whole financial thing was the only thing I was worried about when I put my house on the market. Perhaps I should have demanded a pre-approval letter or at least a glimpse of the credit scores, but I thought 20% down and the knowledge that both husband and wife were in good professions were enough. In any case, their lawyer said that their bank was taken over so I have to assume he isn't lying, right?

[totallyfrazzled]

Originally Posted by TomMoser

Pre-approvals are a great thing. I wish more people would get them.

Tom and Gigi, why do you think most people don't get them? Seriously. Is it because the difference between being pre-qualified and pre-approved isn't explained to them? and if not, is it because most realtors don't realize those terms do mean different things? Is it because the buyers are reluctant to spend the $400 or so on the mortgage application fee before they absolutely have to? I mean really, they're going to be paying it anyway, whether it's to get pre-approved before find their house, or as soon as they go to contract on something. It doesn't cost any MORE to get pre-approved than to wait to apply until you have a house in hand! I can understand why looky-loo buyers wouldn't do it, but if someone is TRULY looking to buy a house (i.e. the "serious buyer") within the next 12 months.... why DON'T most buyers get one? Is there any reason for them not to? If so I can't think of any; can you? Being pre-approved is all upside, both for the buyer and the seller. No downside at all.