Michael

Most realtors do a good job about disclosing out of the ordinary information or else they won't get repeat business or referrals.

Sally Redux

Someone paying '3% of closing costs' sounds a bit odd - it's going to be practically nothing. We gave a credit of $10,000 which was applied to closing costs and worded in a similar way apart from the percentage.

GeoffM

I figured it out (or at least Googled the phrase!) and it should say "...3% of the purchase price..." - or at least that's what I've asked the realtor to put in the offer letter.

Sally Redux

Ah that makes sense.

Michael

If I remember correctly, when my son bought his house in LA, fees were about $4,000 on a sale price of $500,000. Therefore if you get more than about $4,000 or the sale price is less and therefore lower fees and you are allowed to pay for points with the money, get a loan with points at a reduced interest rate. Many times the offer is phrased as a maximum amount for closing costs which usually also means points.

GeoffM

Offer rejected - verbal counter offer was a bit ridiculous: way overpriced for the area. Withdrew from that one.

Wells Fargo weren't particularly helpful either. They didn't want to give pre-approval until we had an offer accepted... and the above seller didn't want to accept any offer until we had pre-approval.

Our realtor wasn't happy with WF for the above and recommended her usual mortgage advisor. Since we didn't know anyone else locally (even friends and family didn't have recommendations) we went with her. By 5pm Thursday she'd had our documents by email; early Friday we saw 5 more houses; by 4pm Friday we had an offer on one of those houses verbally accepted and the mortgage pre-approved with this new lady. Waiting for written acceptance over the weekend.

Oh, and the wife toured her new job which is 18 minutes away! School rated 9 out of 10.

Shit, things are happening!

Michael

Congrats. Everything can move very fast except sometimes the final loan approval can still be a pain.

GeoffM

I forgot to mention: she also recommended fixing a couple of credit issues to bump the wife's score around 27 points, taking her into the next APR bracket, and then doing a "rapid rescore". In this case the fixing is simply paying some credit card bills to the tune of well under $1000 which will supposedly give us >$1000 in "rebates" when it comes to closing costs. Will take around a week and I think it costs a little to do. In terms of APR it makes negligible difference per month but over 30 years it'll add up, of course.

Given our, ahem, middle-agedness, I enquired as to whether it would be an issue for a 30 year mortgage. She said theoretically she could give a 30-year mortgage to a 95-year old granny as age is not allowed to be a discriminatory factor!

Michael

I'm not sure if the score can be bumped up that quickly since normally the credit card company has to report the balance to the credit bureaus and usually they do that monthly for all customers.
That seems crazy but it has been that way for a long time. People usually love it but when the housing crisis hit and they had a loan on an underwater house, then they were unhappy that the bank would finance a long term mortgage with someone so elderly.

GeoffM

Well that's what the rapid re-scoring thing is for - to speed up the reporting. Apparently usually used for mortgage applications and is gaining traction in recent years. There are enough Google results that make it seem a reasonable thing to do; no obvious drawbacks.

AIUI the process is: pay the recommended amounts (we just cleared them off), wait for confirmation that they've been paid, print out confirmation, that gets faxed off to the credit agency (probably with money), they (probably) do a manual verification with the credit card company, they then re-score and send the results back. I think.

Michael

Didn't know that since I haven't had a mortgage for many years.

Giantaxe

Quite right as well. If someone has the requisite income and credit score to qualify what difference does it make when the loan is secured my the property?

GeoffM

Income from pension/investments I guess. Yet another difference from the UK.

Michael

In my opinion, since it is secured by the home and especially since the UK usually requires more of a down payment, that appears to be much of a less risk to lenders than variable interest rate mortgages that are common in the UK.

GeoffM

Ah yes, mostly variable vs mostly fixed rate mortgages, another difference!

Good news: offer on 2nd house formally accepted. 2nd mortgage advisor somewhat more proactive than WF who, 9 days later, have yet to actually do anything.