Lenders have put some borrowers through the ringer due to enhanced underwriter guidelines. Although better qualified buyers are a good thing, idiotic and illogical requirements delay the process and make an already stressful process worse. Karen Deis, the operater of MortgageCurrentcy.com, has collected dozens of these tales of woe on her Facebook page. These stories are downright odd, and sometimes disturbing.
For example, in one case the underwriter demanded a letter from the borrower’s doctor that an illness he had previously would never come back.
Another buyer who was earning $10,000 a month was asked for a letter of explanation about a $6 bank deposit.
A borrower was told the underwriter required verification from her employer when she listed “homemaker” as her occupation.
A deposit of $235 representing the proceeds from a garage sale generated a request for an ad proving there was in fact such a sale.
An underwriter asked for proof that the borrower was no longer under house arrest.
A letter was demanded explaining why the year-old child listed on the application was not named as a dependent on the previous year’s tax return. Then, when the borrower wrote back that the child was not born until after the tax return was filed, the underwriter wanted a copy of the infant’s birth certificate.
An underwriter wanted verification that the borrower, who had written a $167 check to a local grocery store, was not repaying a loan from the grocer.
An updated appraisal was requested because the picture accompanying the original one was deemed too old. It must be old, the underwriter reasoned, because the evergreen trees in the background were green and it was the middle of winter.
The underwriter demanded a letter explaining why a borrower changed her name after she married.
The underwriter wanted a letter from the U.S. Postal Service verifying that the borrower, whose mailing address was a post office box, actually owned the box and that it was the borrower’s primary address.
And finally, a borrower who listed her occupation as “prostitute” and who declared her income on her tax returns, was required to obtain affidavits from her regular customers saying they were, indeed, her clients.
I can help you through the mortgage application process. For expert advice, contact me at 480 675-0112 or firstname.lastname@example.org. And if you had a bizarre underwriting request or underwent “borrower abuse”, let me know.