Lenders NOT Lending?!?!?!?!?!?! What’s up with that?
Well, here’s my theory. The lenders, aka the banks, got themselves in big trouble by not following good business practices and then came to the government (that would be us) and asked for a bail out. We (not really you and me), but the Royal we,gave them bags full of cash with no strings attached. Most of them quickly did what they needed to do (not sure what that was) and paid back the money. Now that they’ve “you know what” and pillaged the natives, they have turned their collective backs on the housing industry. This is the whole pendulum swinging too far in one direction and then swinging too far back in the other direction theory. It seems like they don’t want to lend any more money on housing. You have to have a perfect buyer, a perfect seller, and a perfect property. Well, how often does that happen? Never may be an overstatement, but not often might be ok to say. So, why do I say this? Well, they pick apart the seller asking for every piece of paper they’ve ever received for anything. Copies of this and copies of that. And when you think you’ve given them everything they could ask for, they ask for more, or better yet, say they never received it. It’s harder for them to use that last excuse anymore because everything is trackable with email. I think that’s why the banks will only accept faxes. Hmmmm, I hadn’t really thought about that before. Once they’re done beating up the borrower, uh, I mean buyer, then they start on the property. First they look at the appraisal. If the appraisal came in at value, then they send it out for review. If the review appraisal says its good, then they may send it out for a third opinion and will usually let it drop at that point. But keep in mind that their goal is for it NOT to appraise from the get go. (more about the new appraisal process later). So if it appraises they will probably attack the conditon of the property and make property repairs a condition of the loan approval. They like to go after the big-ticket items like roofs and pools. At this point, if the buyer hasn’t imploded, they may, just may, make a loan. So, the big question is…Why don’t they want to lend money? They are banks. And shouldn’t they want to lend us back the money we gave them to stay in business? Funny you should ask. Well, they are in business to make a profit as we all are, but they are getting higher returns on other investments. If you think this is just my theory, ask any buyer or REALTOR who has recently gone through the process. It’s painful, it’s brutal. And i’m putting a positive spin on this. I may be a little sarcastic but I’m not cynical. My best advice to anyone looking to buy a home right now is to find an agent who has battle wounds from being in the trenches and that has his or her “team” in place to get you through the process. Happy buying !!!!!!!!!!!!!!!!!!!!!!
Wallace…
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