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I am an IT consultant and my home office is Dallas, Texas. However due to covid, we are all working remotely. I am planning to buy a home in Indianapolis. However, my mortgage lender is asking me to provide a letter from my company that they are ok with me working remotely. My company doesnt provide such a letter. He has refused to process the loan and we are just a few days from closing. Please let me know what options do i have. The lender is claiming its a Fannie Mae guideline but when i asked him to provide me link to official guideline, he could not share anything with me. I am very disappointed with this stupid lender who wasted so much time and told me a week before closing that he needs this letter.
I have no clue as to how to find Fannie Mae guidelines but I suspect it's just that lender's policy and the rep is blaming Fannie Mae to avoid having to justify himself. That's what bureaucrats do.
I don't know why you even mentioned that you work remotely. Was there a specific question?
Anyway, your option is to find another lender and either ask for an extension from your seller or just walk away from the deal when the loan falls through.
There's nothing you can do about the "stupid lender." When you want to borrow money you are at the mercy of the vultures who lend it.
Find a kind manager, HR person who could write a simple letter. You could even write it up for them as "XXX is working virtually" and they just have to sign it.
OP, this is a common document request when a borrower works remotely. Especially if they are moving to a new location outside a reasonable drive from their previous location, company office or headquarters. A lender has to be assured your move will have no impact on your position or pay. It is a Fannie Mae guideline that an underwriter has to be reasonably assured of the continuity of a borrower's income in order for the lender to comply with the Ability To Repay law. Why won't your company provide such a statement if it's the truth?
I've never had a remote employee have a problem getting a letter from their employer stating such.
OP, this is a common document request when a borrower works remotely. Especially if they are moving to a new location outside a reasonable drive from their previous location, company office or headquarters. A lender has to be assured your move will have no impact on your position or pay. It is a Fannie Mae guideline that an underwriter has to be reasonably assured of the continuity of a borrower's income in order for the lender to comply with the Ability To Repay law. Why won't your company provide such a statement if it's the truth?
I've never had a remote employee have a problem getting a letter from their employer stating such.
Thanks for your response. I am working remotely due to covid going on. As an IT consultant, I am pretty much traveling and working from the client site. Therefore, my employer can not state that i am allowed to work remotely. I am not sure why does mortgage company care about where I work from or where I purchase the home. I should be able to purchase home in any corner of the country. I have solid credit score and long employment history. My issue is the lender just informed me about this requirement 1 week before the closing when he knew about my situation all along for more than a month.
I have no clue as to how to find Fannie Mae guidelines but I suspect it's just that lender's policy and the rep is blaming Fannie Mae to avoid having to justify himself. That's what bureaucrats do.
I don't know why you even mentioned that you work remotely. Was there a specific question?
Anyway, your option is to find another lender and either ask for an extension from your seller or just walk away from the deal when the loan falls through.
There's nothing you can do about the "stupid lender." When you want to borrow money you are at the mercy of the vultures who lend it.
Thanks for your response. I really hope these stupid lenders go out of business instead of wasting time and effort of people.
Unfortunately, guidelines haven't always kept up with current trends such as the trend for more and more workers to be able to work remotely.
There's one thing I really wish everyone understood -- "Stupid Lenders" don't make the rules and regulations. Please contact your congressmen and women to complain about how difficult the mortgage process is. They are the ones responsible for creating the laws the lenders must follow--Dodd-Frank's financial reform law; Patriot Act; anti-money laundering laws; RESPA, TILA, Reg Z; Ability to Repay...I could go on.
The mortgage process is not an easy one. Financial institutions must navigate all the different guidelines and their company's own overlays. This is where working with an experienced loan officer is vital. Your loan officer should have known right away that a letter would have been needed since you were buying a new primary residence out of state and working remotely.
There are some people, like Adjusterjack, who don't think loan officers are worth the scum on the bottom of a barrel, but this is where an experienced loan officer becomes vital to a smooth process. I would have let you know what was needed upon our initial interview and you would have found a way to get it or we could have worked on another solution.
The letter I have my borrowers obtain simply states "John Doe's move to XYZ state will have no impact on his pay or position." As long as your employer knows you are moving, I can't imagine a reason they wouldn't write such a statement.
Which actually leads me to why such a letter is needed. Going back to the Ability to Repay law, and let's throw in mortgage fraud for more giggles, and an underwriter's responsibility. ... If a loan is not written to Fannie or Freddie guidelines, they become unsaleable. An underwriter puts their name to paper when signing off on a loan that then gets sent to either of the GSEs. If there's a mistake or noncompliance issue within the file, Fannie will kick it back to the lender and the underwriter will get a bad mark. Too many bad marks and the underwriter will lose their license. Who's rules does an underwriter follow? Fannie's and Freddie's, which are written in accordance with all the various laws (ECOA, FCRA, HMDA, QM, Reg X, and the previously mentioned ones, plus more).
A lender needs to reasonably assured a borrower's income is going to continue for three more years, per guidelines. Perhaps Mr. Buyer wants to move out of state and his intent is to find a new job once he's moved because his current employer won't allow him to work remotely. Perhaps, in a COVID economy, it's not easy to find a new job. Soon Mr. Borrower can't make his mortgage payments. ... You get the drift? Hence, if a borrower is moving out of state, the lender wants to be reasonably assured the move will have no impact on the borrower's income. And the lender wants to know that from the employer, not the employee.
One more thing and I'll get off my soap box -- to all the people who only care about getting the best rate, you often get what you pay for. Some of the big lenders who advertise such low rates are paying their loan officers below industry standards. They act as call centers and hire fresh LOs with little to no experience. They are the companies that take what they can, throw it against the wall and see what sticks, then move on to the next batch of crap to throw on the wall. You are a statistical number to them.
An experienced loan officer will get her client--especially if that client isn't a straight forward W2 employee with no overtime needed to qualify, working at the same desk for 10 years and has only one bank account, has rented for 5 years, has no derogatory credit, and has 20% saved over time to put down on the loan--to the closing table as painlessly as possible or she will let them know as soon as possible in the process they are not going to qualify and what is needed in order to qualify.
I'm sorry for what you are going through right now. Check and see if your employer would provide a letter worded the way I suggested and see if that will fly with the lender. Best of luck to you.
Thanks for your response. I am working remotely due to covid going on. As an IT consultant, I am pretty much traveling and working from the client site. Therefore, my employer can not state that i am allowed to work remotely. I am not sure why does mortgage company care about where I work from or where I purchase the home. I should be able to purchase home in any corner of the country. I have solid credit score and long employment history. My issue is the lender just informed me about this requirement 1 week before the closing when he knew about my situation all along for more than a month.
It all comes down to probability of default if you lose your job because your employer found out you were working remotely and weren't supposed to. Now, there's a good argument that this really shouldn't be sticking point during covid when so much of the country is working remotely, but I'd gather this is what the interest is.
employer verification should be contacting your HR and validates. Ask if it's ok for you to give them your supervisor/manager/hr phone # to contact them directly for verification. If not, I would seek for a different mortgage lender to get both better rates and better policy.
Thanks for your response. I am working remotely due to covid going on. As an IT consultant, I am pretty much traveling and working from the client site. Therefore, my employer can not state that i am allowed to work remotely. I am not sure why does mortgage company care about where I work from or where I purchase the home. I should be able to purchase home in any corner of the country. I have solid credit score and long employment history. My issue is the lender just informed me about this requirement 1 week before the closing when he knew about my situation all along for more than a month.
If you're traveling to client sites, and expected to not bill hotel / meals within a certain radius of your headquarters, I could see why the company might be hesitant to give you a letter about working remotely.
I think your employer is the one to blame here, if they have virtual consultants who fly weekly to client sites and bill for travel expenses.
I understand you're upset at the lender, but I wouldn't blame the lender as they are trying to protect themselves from someone buying a home that might not be their primary residence due to work restrictions.
I would be upset at your employer if what you say is really the truth.
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