(Originally published October 17, 2010.)
In my last newsletter, I discussed industry changes that enable lenders to re-verify your credit, debt, and liabilities. Now lenders have instituted another investigative procedure that is disturbing, limits borrower options, and stinks of Big Brother.
CoreLogic, a provider of high-value information, analytics, and risk-reducing business services to the financial industries, has come out with new software that notifies lenders of multiple mortgage applications. If there is more than one application on the same house at the same time, ANYWHERE, even if it’s with different companies, CoreLogic knows.
Here’s how it works:
Their software alerts lenders when another application is submitted on the same property or even by the same borrower. So, if a borrower thinks they’re being cute by applying to two different lenders for a mortgage on the same house, both lenders will know.
Think those lenders will be glad to hear you are “harmlessly” capitalizing on competition within our free market? Think again! Your loan will come to a screeching halt. Neither lender will proceed until you formally and officially withdraw one of those applications. The only thing you’ve accomplished is wasting time, money, and delaying your approval.
But wait! It gets better!
If a seller unscrupulously plays one buyer against another, with both buyers unknowingly having loan applications on the same house, they’ll see the same results. After a week or two of mass confusion, both buyers will finally realize they were suckered. The seller may have thought he was shrewd; but all he did was piss-off two solid buyers and establish a reputation in the neighborhood as a sneaky seller.
Hold on! There’s more!
Look what happens when an innocent homeowner decides to reduce his payments by refinancing his primary residence and his second home at the same time. Or maybe he wishes to take cash out of his home’s equity to purchase an investment property. He too will slam into CoreLogic’s brick wall.
Folks, I can’t make this stuff up.
So what’s a frustrated and disillusioned homeowner or prospective home shopper to do? Here’s a thought:
Stop Shopping For A Mortgage Like It Was A Commodity!
This mortgage industry is not for the feint of heart. Find a Qualified and Competent Mortgage Planner that you can trust and that has your best interests at heart. And then STICK WITH HIM. Or, shop to your heart’s content and watch your transaction come crashing down around you.
In this crazy lending environment, it’s critical that you work with the right people who know what they’re doing and can get the job done. Working together, we can ensure that your transaction goes smoothly and stress-free.
Since 1992, Warren Goldberg has helped thousands of clients own their homes, refinance their mortgages, restructure their debts, and invest in real estate. Warren is known for his wide knowledge of mortgage products and wealth-creation strategies.