June 29th, 2011 11:16 PM by Eric Fang
We do have loans will fail. Here are the scenarios:
1)The value is a problem. Then if the borrowercan not pay down or does not like PMI, then theloan will fail.
2)Condo has letigation, or the community not completed,or Condo has owner occupancy ratio too low.
3)Some lenders does not like to do the loans for condo rentals, or high-balance condos. If we submitted the loans to those lenders, the loan will fail.
4)Most lenders will not like gift money in refi.If your relative gave you some money on the statements,the lender will not get you loan, even for repayment of the loans.
5)Slow response to the loan agents' requests for the documents. I had one borrower gave me signed loan documents15 days after I locked the rate, I managed to save that loanin the end of 2010. But failed this time because the expirationof the rates. And there is another case, that the borrowerwas unwilling to provide some documents, like tax returns, assetsdocuments, etc. A few loans failed that way.
But still the failed loans are only small percentage of my portofolio. I am glad that I closed more thanone dozen loans from Provident Funding this week.I would like to thank those clients getting me therequired documents within 24 hours. And we did save a few loans because of the vacation delay, etc.
If we can co-operate well in the future, the fall-out ratio will be even much less, and my ratio is alreadyvery low in the industry.