Ask McEnearney: I Need to Get a Mortgage — When, Where and How?

This week’s Q&A column is sponsored and written by Ann Duff of McEnearney Associates Realtors®, the leading real estate firm in Alexandria. To learn more about this article and relevant Alexandria market news, contact Ann at 703-965-8700 or email [email protected]. You may also submit your questions to McEnearney Associates via email for response in future columns.

Question: The ads are everywhere for online financing sources such as R—et Mortgage and Q—en Loans, what is your experience with these kinds of companies?

Answer: Out of State, Out of Our Minds

Todd,* my delightful buyer, was a sharp, tech-savvy businessman determined to get a great rate mortgage over the Internet. He logged on to a well-advertised website and sent along the details of our Sales Contract. Appropriately proud of his sterling credit, Todd pledged 20% down and started to plan his move to Old Town Alexandria. End of story?

NO SUCH LUCK! Enter Chaz* from the California-based mortgage brokerage which had received the loan form. “I’ve made loans for 30 years, little lady,” he boasted to me, “Don’t worry. Where are you calling from? West Virginia?”

Chaz:

1. Didn’t know any local appraisers and chose one from Baltimore.
2. Had heartburn about any home over 60 years old, let alone this 192-year old classic.
3. Promised 3.25% interest rate and didn’t lock it in as rates drifted higher.
4. Blamed Todd for not telling him the building could also be used commercially.

After bragging about his California successes, “I’ve closed every loan I’ve gotten my hands on, missy,” Chaz demanded another 10% down, raised the interest rate to 5.25%, emailed a lame apology note and left early for a long weekend, three days before our settlement!

Epilogue: A local lender saved the day, jumped in, took the file and settled in four days! There are excellent area banks and mortgage brokers who know our Northern Virginia/D.C./Maryland homes, offer very competitive rates and give hands-on service. Start locally, save your sanity.

Not convinced, read on…

Can You Look Them in the Eye?

Another out-of-state lender played “yo-yo” with a buyer’s emotions early last week. “We’re just so swamped,” whined Jimmy from his XYZ Co.* office in Plano, Texas, “with interest rates at a 40-year low, everyone wants to refinance. I don’t know why our regional office hasn’t returned your phone calls this week; maybe they’re busy, too.”

For the next five minutes I heard a string of unbelievable admissions. “I know we’re supposed to settle next week, but I have to tell you that I don’t have the appraisal in yet, somebody here forgot to send the condo management office an important declaration form and, oopsie, the figures I used for Mollie’s* Good Faith Estimate were based on California closing costs,” he said.

“And, by the way,” Jimmy rattled on, “would you tell her we might have to slip settlement a couple of days.” I could not let him continue. “Stop right there,” I insisted, “I will not tell her it’s slipping, because it’s not going to!”

“Mollie has a moving van coming from New York on Saturday. She had your full loan approval three weeks ago, wanted to use your company because her family used it years ago and she is a real buyer, not just a re-fi, so we have to make this work! What can you do right now?” I pleaded.

The stress Mollie went through over the next 48 hours was so avoidable. If she hadn’t been wed to using XYZ company, she’d have had a far more comfortable and personal transaction. Look them in the eye. Talk to the local competitive lenders who are working in the D.C. area day in and day out, who answer their emails and cell phones, who meet you at your office or mine, who know the closing costs for the jurisdiction and who meet your deadline, not theirs.

Oh, Jimmy you ask? He pulled it out in the end and we settled, but not without getting branch office supervisors involved, spending hours on the phone and guessing at the final closing costs. Even then, the instructions from XYZ Co. overcharged for the appraisal and had an available line-of-credit showing as a fully-funded $30,000 second trust which threw the closing docs way out of whack.

If Mollie could have looked Jimmy in the eye, she might have punched him in the eye. Stay local, stay happy.

Ann Duff — your positive advantage for Residential and Commercial properties throughout the area. Experience and Energy, Negotiations and Knowledge — all with a splash of fun! Let’s Get Busy!

*Note: Names have been changed.

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McEnearney Associates Realtors®, 109 S. Pitt Street, Alexandria, VA 22314. www.McEnearney.com Equal Housing Opportunity. #WeAreAlexandria