Mortgage Blog

One failed purchase transaction

March 17th, 2016 11:04 PM by Eric Fang

I have one loan just failed recently. I hope the buyers can learn from this transaction.

The property is a condo, and the buyers purchased as a rental. The owner occupancy ratio is 52%, and there is no litigation. The loan amount is less than $417k with down payment more than 25%.

This would be an easy loan, right? Yes, or no. I had the loan conditionally approved within one week, and the appraisal was done within one week, and the buyer has only one week to remove contingency. Everything seems like ok except the condo project approval. The HOA master insurance does not cover "building ordinance or law coverage". And all the wholesale lenders could not approve this loan because of this. And one lender even said that they did not understand how expensive those two coverages are, so the HOA chose not to have it? During my last 13 years as a loan agent, it is my first time that an HOA does not have this coverage and caused the loan fail. 

Anyway, we need to be careful for the condo purchase, and we need to check the master insurance we the buyers accept the offers. Very weird.

Anyway, the rate is a little bit better today, and I locked 3 loans today. I plan to lock another 3 for tomorrow.

Booked the tickets for Portland Marathon in Oct. The whole family will go there, my daughter and my wife will run half marathon, and I will run full marathon. We are all looking forward to it.

Posted in:General
Posted by Eric Fang on March 17th, 2016 11:04 PM



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