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Our Personal Experience With Big Bank Financing; Not So Good

big bank financingHeejin and I are buying a property in Texas. B/c JVM is not yet licensed in Texas, we pursued financing with other lenders. B/c we are well qualified, Heejin submitted applications to numerous lenders so we could observe their processes and see what they had to offer. She focused on large banks and credit unions to take advantage of their ostensibly enticing jumbo financing.

We chose a bank with extremely competitive terms, and submitted all of our paperwork in perfect order, as we know the drill pretty well :). And… after 17 days, the bank had not touched our near-perfect file. Nothing. No appraisal. No underwriting. No submission. It was a shocking example of pure negligence.

The loan officer, failing to notice Heejin’s 28 year career in mortgages, called her up and tried to “mansplain” some nonsense about TRID, CDs, compliance, etc. Heejin rightfully ate him alive, and we moved on to our backup lender to make sure we can close on time. We’re now getting a rate not too different from what we can offer at JVM.

It was also interesting that many of the banks had very good front end loan submission processes, employing excellent technology. But, service levels invariably plummeted from there. The loan officers and support staff were clueless (they lacked training), non-responsive and out of touch. The entire exercise was a great, and rather uplifting, learning experience for us.

According to Yelp and many other reviewers, it looks like our experiences with these banks is not too different from those of many other qualified buyers.

My point is that service is far more important than most people realize, especially when they are trying to close a purchase in a timely manner. When borrowers chase rates, they will often have experiences similar to ours.

There are of course exceptions where banks do perform well, particularly with private banking. But there is a reason mortgage banks have been stealing so much market share from the big banks in recent years. And our experiences and those of of the many Yelp reviewers say it all.

On Wednesday, I will discuss interest rate disparities among mortgage banks and other institutions, as this question comes up often.

Jay Voorhees at (925) 855-4491
Real Estate Broker, CA Bureau of Real Estate, BRE# 01524255, NMLS# 335646