I once spent an extremely frustrating weekend defending a competitor to two exceptionally irate borrowers. Their transaction blew up at the 11th hour b/c an investor refused to sign off on an unexpected condition. So the lender, RPM Mortgage, was forced to go to another investor, delaying the transaction.
The borrowers were irate b/c the delay put their purchase at risk, and they were convinced RPM was trying to “bait and switch.” They also insisted that RPM should have foreseen the issue. The borrowers were then referred to us by the listing agent.
I defended RPM for selfish reasons b/c the borrowers were so emotional and threatening that I did not want to risk dealing with them. I also knew that we could not close faster than RPM, who already had a full file. But, I also defended RPM b/c we have been in the same position many times since 2010 and I was very sympathetic. I knew RPM had done nothing wrong.
Getting loans fully approved is a very complex process now days, especially in the jumbo arena. Loan conditions are often irrational and in place solely so underwriters can check off boxes (as opposed to make sense).
Lenders need help from their Realtor partners explaining this, so suspicious borrowers understand that: (1) lenders are not trying to bait and switch when transactions blow up; (2) lenders often have no control over irrational conditions; and (3) even the best lenders cannot foresee every condition.
Frustratingly, many of us are forced to fund loans at an enormous cost for emotional borrowers in order to avoid negative social media reviews.
Founder/Broker | JVM Lending
(855) 855-4491 | DRE# 01524255, NMLS# 335646