Lender is just stringing me along!

Hello Everyone, this is my first post (recently registered) but I am a long time ghoster.

I found a house in foreclosure for 122K. The home is a 3/2 with a pool. In order to put the home under contract, I went through a preliminary screening process with a huge well known lender and was told that I qualify to purchase the home. I put $500 down, paid $275 for an appraisal (will be refunded at closing) and $400 for a home inspection.

I began submitting all of my information to the lender. I gave them everything they asked for. Once the file was submitted to underwriting, the underwriter questioned my ability to pay the loan because she said it’s her belief that I would experience what they call “payment shock”. I currently have a roomate I have been living with for the past 2 year. Our rent is $895. There were months where I paid a portion of the rent and were months I paid all of the rent (roommate lost job at one point).

I make over 50K + a bonus. I have been waiting for an approval for almost 2 weeks. The only thing they are telling me is that the file has been submitted to a higher regional office for review because of the “payment shock” issue.

Have you ever heard of such a thing? I am litterally beside myself right now. I fired off an email to the branch manager because I was given two extension and the last extension expires on the 30th of December. I was told that I would not get another extension. I think they are stringing me a long so that the extension will expire.

What is really going on? What do you suggest I do?

If the house is only 122k the payment shock issue sounds very fishy. Are you doing 100% financing?? It sounds to me as if there is another issue and they are just making excuses. Unfortunately with the 30th being less than a week away you may be out of luck. I would suggest speaking with another lender ASAP. It will be nearly impossible to close on time, but your new lender may be able to call the sellers rep and explain that you were misled by your current lender and provide them with an approval that will give you an extra week to get this deal done. Because you have title, appraisal, and insurance in place underwriting should flow smoothly.

I agree as well that the whole thing sounds fishy. I am doing an FHA loan with 3% down.
I am going to be very upset if the loan is not approved because I don’t have any money to waste. I need a better explanation than the one that was given to me. Hopefully I will hear something tomorrow. If not then I will look for another lender.

payment shock is basically whatever your paying versus the new amount of the mortgage. They are looking at this as if your room mate wasn’t involved. Did your rep tell you that they had a conditional approval? This approval is when the loan is given to underwriting and they will give a series of stipulations of the approval. Do you know if the appraisal was signed off on yet? My suggestion to you would be to contact your loan officer and ask if they received a conditional approval and c if they signed off on the appraisal yet. Once you know this, you’ll have an idea as to what to do next.