How can a Mortgage Broker Mend a Buyer's Broken Heart?

By
Real Estate Broker/Owner with Home Buyers Realty, LLC-Manchester, Bolton. Vernon,Ellington 0788174

Indeed, you can't count your chicken before it is hatched despite the lucid life breathing in the embryo lulling comfortably inside the shell. Well, that was the picture I could see until  ONE GLOOMY DAY.

Apparently, the chicken might not reach its full term. 

I could dwell in exasperation and frustration with this transaction nearing consummation for days because of lost of imminent commission and time where I could have put to use in something more productive. But it is a duty call a buyer's agent has to attend to.

In two occasions, I have likened a lady-in-waiting for the gas and electric company to call me to get the utilities activated for my buyer since the property is HUD-owned and activation is the buyer's responsibility.

The window for the electric company: between eight in the morning and twelve noon. Not as bad as the gas company who gave me a twelve-hour window: 8AM to 8PM. 

All these aggravations plus the mourning over the GREEN BUCK$ for which I started digging its grave are TRIVIAL.

A week ago, I saw a face of a buyer glowing as he professed the exhilaration about owning his first home in the United States. His eyes sparkled with enthusiasm while narrating the color scheme he picked up for the carpet and walls; the furniture set's style and its configuration and the conversation he had with his family back in his home town announcing his latest conquest- HOMEOWNERSHIP. It may not be a verdant oasis. But it is the integral part of his dream. The American dream coming into fruition!!!

Last Friday, I could see that same face--sullen; his body-- sulking and his heart--shattered.

The joy that emanated from getting the commitment letter was pounded hard into broken molecules that vanished quickly as it appeared. 

The REASON: EXPIRED GREEN CARD.

At first, I was bewildered. Why was he able to get a pre-approval with an expired Green Card? To answer my question, I asked one of the loan officers I work with in a regular basis if he asks buyers during the prequalification process the question as to the status of his residency in the United States. He told me that it is included in the questionnaire.

Since my buyer chose to work with the loan officer of the bank he has an account with, I could not blame myself for not doing my job in referring him to any of the competent loan officers I deal with in most of my transactions.

Granted that my buyer instituted his own predicament by letting his green card expired, and assuming that it could have been an honest memory lapse and provisional irresponsibility because he has been paying Uncle Sam his dues dutifully, why did the loan officer give him the go signal when at the time of application, his card is already expired?

Don't you think this dilemma could have been avoided?

How could you appease and recompense a buyer's crushed emotions? Never mind the money he spent on home inspection, appraisal and the lost of wage for the hours he took away from work to be present during the process, or either the money he has to pay as penalty for the lengthy extension or forfeited deposit.

I have never asked a prospective buyer if he has a valid green card or a citizen of the United States. 

After this incident, I may not be comfortable adding this question in screening the buyers,but I might just do it.

 

 

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Show All Comments
Rainmaker
315,442
Dave Halpern
Keller Williams Realty Louisville East (502) 664-7827 - Louisville, KY
Louisville Short Sale Expert

"paying Uncle Sam his dues dutifully" interesting way to define taxes.

Jul 22, 2012 08:13 AM #4
Ambassador
1,034,444
Karen Fiddler, Broker/Realtor
HOM Sotheby's Intl Realty, 949-510-2395 - Laguna Beach, CA
Laguna Beach & Lake Arrowhead, CA (949)510-2395

Oh I'm sorry....the human aspect is heartbreaking and the lender is clearly not doing the due diligence needed. This should have been something they verified right off the bat. But it's for a reason....the lender doesn't want them to lose the ability to pay for the home. If he's no longer able to work legally, then of course he can't. 

Jul 22, 2012 08:16 AM #5
Rainer
132,161
Laura Murray
Weichert - Silver Spring, MD
Search Montgomery Co., MD for homes www.MDRealEstateOnline.com

Hum, I am going through the EXACT same thing right now with a buyer.  I am the listing agent, and the buyer is having last minute immigration issues getting the loan.

Jul 22, 2012 08:55 AM #6
Rainmaker
258,209
Rob Spinosa
RPM Mortgage, Marin County, CA - Mill Valley, CA
Marin Mortgage Broker

I'm not going to step in and defend the loan officer in this case --- enough said above.  However, there is a tendency for citizenship elements to go overlooked.  Nine of ten borrowers will be US citizens, so a lot of loan officers get lazy and just assume.  And when you're not dealing with a citizen it does take another level of examination.

I have a client now who is on an advance parole status --- there is no visa involved. The borrowers need a high-balance conforming loan, which requires an even greater degree of scrutiny.  It has been a real chore to make certain their documents will fly, but I cannot proceed or make any representations until I'm certain. 

Nobody likes waiting while I find this out, but first things first. 

Jul 22, 2012 09:00 AM #7
Rainmaker
694,838
Gene Mundt
www.genemundt.com - 708.921.6331 - New Lenox, IL
Chicagoland Mortgage Lender - 37 yrs experience

Rob above voices the concerns and path of action that a mortgage lender must and should be taking, very well.  Paperwork is becoming all-important in any transaction.  In this particular instance, even more so.  Special care must be taken.  Obviously is was not.  True, the buyer needed to take action ... but his lender should have been directing it and then staying on him to accomplish it along the way.  Sad scenario ...

Gene

Jul 22, 2012 09:28 AM #8
Rainmaker
508,252
Chris and Dick Dovorany
Homes for Sale in Naples, Bonita Springs and Estero, Florida - Naples, FL
Broker/Associate at Premiere Plus Realty

Terrible but lesson learned.  Keep up with your green card dates, escrow dates, inspection dates, bank dates, etc etc.

Jul 22, 2012 09:49 AM #9
Rainmaker
284,458
Maria Gilda Racelis
Home Buyers Realty, LLC-Manchester, Bolton. Vernon,Ellington - Manchester, CT
"Your Goal, My Goal. We Can Make it Happen."

Good Afternoon Everyone: 

Jeffrey: It is a disheartening experience for my buyer and of course, for me. thank you for your comment

Hi Debbie: It is good to see you again. I will definitely add this to my list. Thanks.

Hello Michael: Quite correct. I would have asked this question but it did not dawn on me that this problem will arise until recently.

Hi Dave: Paying taxes is one of our duties, isn't it? Whether we like it or not:)

Hi Karen: Yes, obviously, there interest that the bank needs to protect. However, at the big expense of the buyer. thanks for the input.

Hi Laura: I can certainly relate to whatever not-so-delightful feeling you have now.

Hi Rob: I primarily leave this prequalification process to the loan officer. But this time, I will take an extra step and effort.

Hello Gene: How are you? I can't agree more. The lender should have directed him to the path in the very first stage of the process.

Hello Chris and Dick: Unfortunately, with HUD, the buyer has only ten days from the date of the fully-executed contract to rescind due to financing.  The green card issue should have been unravelled during the initial interview. This is not normal underwriting conditions that pop up to get the the commitment letter,

 

 

 

Jul 22, 2012 10:07 AM #10
Rainmaker
571,664
Hella Mitschke Rothwell
(808) 226-1095 or (831) 626-4000
Hawaii & California Real Estate Broker

You don't need to actually SEE the card, just make them aware of the problem if you know they are not citizens.

Jul 22, 2012 10:30 AM #11
Ambassador
1,091,387
Debbie Reynolds
Prudential PenFed Realty, "The Real Debbie Reynolds" Your Clarksville Real Estate Professional, 931-920-6730 - Clarksville, TN
Your Dedicated Clarksville TN Real Estate Agent

Maria, I wouldn't have thought about that either but maybe that needs to be part of the prescreening process.

Jul 22, 2012 11:38 AM #12
Rainmaker
553,078
Gary Frimann
Eagle Ridge Realty / Signature Homes & Estates - Gilroy, CA
California Broker and REALTOR

Oh the heartbreak.  The question on the loan app is "Are you a US Citizen?" which is followed by "Are you a Permanent Resident alien? (Section VIII items j and k on the FNMA 1003 loan app).  It is foreseeable, yes, but one would think the guy would have considered this.  Sad story.

Jul 22, 2012 02:53 PM #13
Rainmaker
284,458
Maria Gilda Racelis
Home Buyers Realty, LLC-Manchester, Bolton. Vernon,Ellington - Manchester, CT
"Your Goal, My Goal. We Can Make it Happen."

Hello Hella: Excellent point. By educating them on the ramifications, it will certainly thwart undesirable and heartbreaking outcome.

Hi Debbie: I know. After six years in the business, I have never encountered this problem.  And it was not pleasant--especially for the buyer.

Hi Gary: thank you for stating the specific order in the questionnaire. This is a great information.

 

Jul 22, 2012 04:05 PM #14
Rainmaker
152,045
Dana Basiliere
Coldwell Banker Hickok & Boardman Realty - Burlington, VT
Making deals "Happen"

Photo of Dana (head only)

Maria,

Sad that it happened to him, and you. Our hearts go out to the buyer in these cases but I also see a nice young lady Realtor who put a lot of time and energy in to this with no compensation for time. I feel bad for you.

 

Jul 22, 2012 06:08 PM #15
Rainmaker
523,826
Jill Sackler
Charles Rutenberg Realty Inc. "Said and Done!" - Merrick, NY
Long Island's South Shore Real Estate Agent

Oh, wow. I never thought of that. That is so sad for everyone involved with this transaction. Can he remedy the situation and begin anew?

Jul 22, 2012 06:26 PM #16
Rainmaker
284,458
Maria Gilda Racelis
Home Buyers Realty, LLC-Manchester, Bolton. Vernon,Ellington - Manchester, CT
"Your Goal, My Goal. We Can Make it Happen."

Good Evening Dana: thank you for the warm consolation:)

Hi Jill: The loan officer said that he needs the new green card with valid date before we can proceed. I don't know how long it will take for the buyer to get it. He did apply already once he heard the bad news. This will cost him exorbitant amount of money to request extension from the HUD. I hope it gets processed expeditiously.

Jul 22, 2012 07:23 PM #17
Rainmaker
1,070,266
Joan Whitebook
BHG The Masiello Group - Nashua, NH
Consumer Focused Real Estate Services

This is terrible new for your buyer.  Fortunately, I have not had  a buyer in this type of situation.

Jul 22, 2012 07:32 PM #18
Rainmaker
284,458
Maria Gilda Racelis
Home Buyers Realty, LLC-Manchester, Bolton. Vernon,Ellington - Manchester, CT
"Your Goal, My Goal. We Can Make it Happen."

Hi Joan: It is indeed a terrible situation. I feel bad for him--he suffered financially and emotionally.;)

Jul 22, 2012 07:42 PM #19
Ambassador
1,565,439
Christine Donovan
Donovan Blatt Realty - Costa Mesa, CA
Broker/Attorney 800-610-7253 DRE01267479 - Costa M

Maria - This lesson may help another potential buyer prevent heartbreak especially since you've shared it here.

Jul 22, 2012 11:21 PM #21
Rainmaker
943,607
Joe Petrowsky
Mortgage Consultant, Right Trac Financial Group, Inc. NMLS # 2709 - Manchester, CT
Your Mortgage Consultant for Life

For many years, I didn't ask the question about expired green cards or an expired work visa. You don't have a problem, unless you have a problem. Well, it happened to me, many years ago and I neve made that mistake again. This is one of those thing you would do, unless you have had it happen to you.

This is just one of those mistakes, neither of us will make again.

Jul 23, 2012 05:19 AM #22
Rainmaker
266,504
Jay Beckingham
Premier Nationwide Lending - Port St Lucie, FL
"I love first time homebuyers"

in southwest florida we deal with this frequently. yes the lender needs to do their due diligence, but

what about the man in the mirror? when are we going to start the blame game at the right place.

 i notice i don't see any mention of the fact that the buyer knew that his card had expired.

just a thought.

we might not have as much documentation, and lenders might be a little more trusting if more buyers would come clean.

sorry about sounding like cruel jay today but i was always told there are two sides to the story so let's address both sides.

Jul 23, 2012 06:01 AM #23
Rainmaker
284,458
Maria Gilda Racelis
Home Buyers Realty, LLC-Manchester, Bolton. Vernon,Ellington - Manchester, CT
"Your Goal, My Goal. We Can Make it Happen."

Hi Christina: Hopefully, we can learn a lesson from this. Thanks for your comment:)

Hi Joe: A pleasure to see you here. Yes, it is a hard lesson learned. Your acceptance and admittance of your own mistake is a commendable act. Not everybody will willfully do it. Thank you.

Hello Jay: It is okay to be the cruel Jay today. It is my client and adding insult to injury will not make a difference. Thank you for your comment.

Jul 23, 2012 08:18 AM #24
Show All Comments
Rainmaker
284,458

Maria Gilda Racelis

"Your Goal, My Goal. We Can Make it Happen."
Do You Have Questions About Home Buying? Ask Maria
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