FLU,
Your 5 details are the epitome of anecdotal evidence and completely meaningless.
Not one of your 5 points meant anything regarding your HELOC
subordination approval, which is the thread topic.
He didn’t have to mention HELOC. I’m 99.5% sure it’s a HELOC based on the details.
MM…. If the HELOC is left in 2nd position, it’s going to require a subordination whether it is at zero, maxed out or any balance in between. It’s probably going to cost $250 to subordinate.
Another recent issue recently is Solar lien subordinations, which can also delay loan fundings.
If your loan originator isn’t on it from the beginning, it could delay your closing which could cost you even more money if you need to pay for a lock extension at the end.(In addition to sub. fee)
In FLU’s example, extending a $350K loan for 3 weeks could cost $1400 with some lenders.
It should not take that long if addressed from the beginning.
Different lenders can have different policies about open available line on HELOCS. There was a time that you were better off having your line maxed out VS. having no balance drawn; because the payment factor was lower.
It may still be true with some lenders.
Believing that a loan was approved solely because of low LTV, W2 income & lack of debt is completely missing the point.
Your loan was approved, because it was approved based on guidelines. You didn’t get ANY extra credit for things that you point out.
Self employed people with a 680 credit score and lots of debt can get approved for 97% LTV loans.
Loans are approved on income & expenses.
They are priced on a combination of credit score & equity.
Lots & lots of people get approved with 3% equity.
Lots of people with 800+ credit scores and 50% equity get turned down, even if they have $1 million dollars in the bank.
Although W2 income without bonus, commission or overtime is easier to figure, those with other sources of income qualify also.
You don’t get extra credit with W2 income.
Being on a job for 6 years or 20 years means nothing extra to an approval. If 30 or 60 days income is needed, you get no extra credit for 6 years.
If a 740 credit score is needed for best pricing, you get no extra credit for 800 or 830.
2 months bank statements are generally required.
You get no extra credit for providing 12 months bank statements.
60% LTV is best pricing, it isn’t any easier to get an approval with 35% equity.
Getting loan approvals can involve 100 pieces of a puzzle all coming together, 80% of which the borrower isn’t even aware of.
If there’s only 99 pieces available, the loan gets denied.
There are people with $1,000,000 homes with an 800 credit score, $1M in the bank and no mortgage who don’t qualify for a $200,000 refi loan.
The govt regulations have made getting a loan denial a humbling experience. I chuckle every someone tells me that they will have ‘no problem’ getting approved for a loan.
