Deal killer questions* Did you review all of these deal killer questions with the customer?
Here is a list of Deal Killer Questions, If there are any others you suggest please contact Mike Ayoub.
After initial loan application great Loan Officers ask a number of questions and think like an underwriter. Loan Officers should know the solutions to these common problems and pitfalls in addition to so much more. Use this checklist to identify potential obstacles and ask a mentor for the solutions to any of these problems on your file. There are solutions to nearly every stumbling block in this business! It's too late just prior to scheduled closing to attempt to solve a problem. Solve it early! A Loan Officer is only as good as their last loan.
Make sure to warn the customer to not apply for ANY new credit. ------------ Applying for New Credit Alongside the Mortgage: Be sure to avoid applying for any other type of credit before and during the mortgage application process. Whenever you apply for new credit, you're seen as a greater credit risk, at least initially. If you happen to apply for a credit card or auto loan around the same time you apply for a mortgage, your credit score might get dinged enough to kill your eligibility or bump up your interest rate.
Make sure the assets are Seasoned. Many clients make the mistake of Not Seasoning their Assets: The bank or lender will want to see that you can actually pay your mortgage each month. But without seasoned assets, those that have been in your own account for at least a couple months, you could be out of luck entirely. Some borrowers seem to think they can transfer funds from a relative's account days before applying, but this simply won't fly once the underwriter uncovers the paper trail.
Job Hopping: Another key to mortgage approval is steady employment and income. An underwriter will want to know that the income you bring in every month is consistent and expected to continue into the foreseeable future. So don't jump from job to job too much before applying for a mortgage. If it's in the same field, it shouldn't be a deal killer, but a career change will lead to problems. If you're thinking about jumping ship, wait until you've closed your mortgage first.
Forgetting to Lock Your Rate: Keep in mind that a mortgage rate means very little if it's not locked-in. If you're happy with your rate, lock it. Mortgage rates change daily and sometimes several times daily. All those mortgage quotes you obtain are just quotes until you actually tell the bank, lender, or broker to “lock it in.” Once locked, your rate is guaranteed for a certain period of time, be it 7 days, 15 days, or a month. But never assume your rate is locked until you get it in writing!
Ask these questions. The response may kill deals, or it may change the deal process.
(Pur or ref)Is your home a manufactured home? If manufactured home the deal may not be a closable loan.
(Pur or Ref) How many acres does your property sit on?
(purchase) Your assets must be seasoned have they been in the bank for at least 60 days?
q Is the property presently for sale or has it been recently?
q Is the current loan to be refinanced a FHA loan?
q Have there been any draws against an equity line or second trust deed in the past year?
q Has the reason for the cash out been explained in writing? Is it leading to more debt?
q Is the appraised value a potential problem?
q Does the property sit on large acreage and/or is it rural?
q If the subject property is a condo is the condo approved? Did you get the condo name?
q Is the property on a private road?
q Is the property currently under renovation?
q Are there any repairs needed on the home to get an average condition appraisal?
q Is there anyone on the title of the property who is not going to be on the loan?
q Is there anyone on the loan request who is not currently on the title?
q Have there been any changes in title in the last year?
q Has the borrower owned the home for less than one year?
q Is the property in a trust?
q Does the borrower have any additional cash reserves or retirement assets?
q Does the loan that will be paid off have a prepayment penalty?
q Is there any documentation that would indicate the borrower does not live in the property?
q Is the property a manufactured, prefabricated, modular, or a mobile home?
q If Manufactured, do you have a certificate of original delivery of the manufactured home. and does the customer have the title if it has not already been released to the property?
q If so does the borrower pay property tax or motor vehicle tax?
q Is there any documentation that would indicate the borrower is self-employed?
q Can the borrowers withdraw from their retirement account in an emergency?
q Are there any loans against the borrowers 401k or retirement account?
q If so, what is the monthly payment?
q Does the borrower pay child support or alimony? Did you get the complete divorce decree?
q Have the borrower been continuously employed for the last two full years?
q Did you obtain accurate starting and ending dates for all employment?
q Do you need an explanation for position changes or declining income?
q Do you have the last two years complete federal tax returns and W-2’s if needed?
q Does the average income match your application? Did you highlight the 1040’s appropriately?
q Did you breakdown salaried and variable income?
q Do you have documentation of the last two years of variable income and did you average?
q Does the file need a letter from the employer?
q Are there any withholdings on the pay stubs indicating additional debt or loans at work?
q Does the year to date history on the pay stubs match the annual income level?
q Can you gross up any non-taxable income?
q Has the borrower cosigned for anyone else’s debt?
q Does the borrower have any tax liens or judgments?
q Have you written a cover letter for your file?
q Are there any loans on the credit report that you have not matched to a property or asset?
q Is everything that you are submitting to your processor complete, accurate, and legible?