A couple of weeks ago I warned you that fewer mortgage loans were being granted this year, because credit score and down payment requirements have changed. Borrowers now need higher credit scores and more down payment.
However, those aren’t the only issues facing would-be home buyers – or those who are seeking a refinance on their existing Pittsburg, CA homes.
The banks have stricter requirements because they’re afraid of more forbearance requests and / or defaults. For the same reason, they’ve become almost fanatic about verifying a borrower’s employment.
In the past, a lender would check employment before pre-approving the loan, check again just prior to closing, and perhaps check once more in between those two events. Today, they’re checking as many as 10 times, just to be certain they’re granting a loan to an employed borrower.
This takes time – and just imagine the extra work load and annoyance for employers in businesses that may already be under-staffed.
Added to that is the fact that many workplaces ARE understaffed right now and some are being operated remotely. In some places, County offices have been closed entirely, making it impossible to check details like assessed values and property taxes.
In some communities, inspectors and appraisers are still not allowed to go inside homes, and as we know, lenders do require appraisals. Some lenders have resorted to allowing “drive-by” appraisals, done purely from an exterior look plus photos and information posted on line. This could be good or bad for the parties attempting to transfer ownership of a home.
The upshot for you: If you’re making an offer on a home, allow more time than usual between acceptance and closing. Check with your lender to see what they recommend, then add a few days for safety’s sake.
This could all change soon.
2020 may come to be known as the year of change. We seem buffeted by the latest pandemic news and predictions.
Now that more states, counties, and cities are opening for business, the time delays could fade away. And, as more people go back to work, as evidenced by the May jobs report, lenders should become less fearful of making new loans.
For now, however, we have to proceed as if restrictions and delays are the new normal.
Are you ready to find that new Pittsburg, CA home? If so, I’m ready to help. Call me today.