Seeking a Laguna Beach Home Loan? Dealing With the New Nosiness

If you’re after a loan for Laguna Beach real estate, you’ll be dealing with a new nosiness. Why? Because banks are still reeling from the foreclosure frenzy. So they’re heaping more questions than ever on anyone seeking a mortgage for a Laguna Beach property. Understandably, everyone wants a 100% safe borrower – or as close to this fictional creature as possible. To boost of your chances of success on the Laguna Beach home loan front, here’s a sneak preview of some of the new twists on an old theme. But be prepared -- not only will you need answers, you’ll need the documentation to back them up.

Income – This one is obvious, of course. But banks nowadays are likely to venture into more details, as in – why did your income jump by 10%? Know the answers, and have at least two years’ worth of money-related documents compiled and organized BEFORE you saunter into Lender Land. They are even asking for utility bills if you have a different address on you application than where you actually live.

Credit Inquiries – A red flag for lenders. Be prepared to explain your repeated requests for FICO  reports…and the eventual outcome. Which brings up –

RULE #1 from Hillary’s Book of All Real Estate Knowledge: During the three months prior to buying a home, do NOT finance a purchase of over $2,000, nor give ANYONE your social security digits. And definitely none of the above during escrow. The banks can run your FICO scores prior to closing. I’ll never forget a client who bought a Land Rover in the midst of escrow. Helloooo! – their loan fizzled soon after.   

Disputed Accounts – Sure, you rightfully disputed the undeserved late charge or a balance that was off by a small fortune. But said dispute is still on your record. Many lenders will ask you to make it go away before they approve a loan. 

RULE #2 from Hillary’s Book of All Real Estate Knowledge: Snap up one of those free credit reports that conceal your FICO score. These reports still will reveal any problems such as disputes. So you can clear these blemishes prior to home hunting.  

College Transcripts and Diplomas – You might be on your way to a stellar career as a physician. Still, most banks want an employment history spanning at least two years. If it’s been less than a year since graduation, you may be asked to provide transcripts and a diploma. For me, it’s been 30 ½ years since dawning cap and gown, so Almighty Lender, don’t even THINK about going there!  

Play It Smart

As a borrower, you’re naturally eager to supply a prospective lender with needed answers and documentation. But make sure you’re offering the sensitive info to the bank, and only the bank. Believe me, the scams are out there. When you get a call requesting information, confirm the identity of the requestor. If it’s a loan officer or other representative who’s unfamiliar to you, call the bank for verification. They ask the same of you, right?

RULE #3 from Hillary’s Book of All Real Estate Knowledge: Shop, shop, shop around! And absolutely use a preferred lender who has worked with your Laguna Beach real estate agent and who has consistently closed their deals on time. Steer clear of your ‘best friend’ who just got a license yesterday, or a 25 year veteran who’s ready for retirement and clueless about the latest laws and procedures.

Are Banks Being Too Demanding?

A big question looms – Are banks going too far with the avalanche of questions and requests for documentation? Should they scale back to a more traditional approach now that things are stabilizing in the Laguna Beach real estate market? We’d love to hear your views. So share your opinion in the comment box below.

And, as always, if you’d like to learn more about the opportunities in the Laguna Beach real estate market, our acclaimed team is ready to assist you. Contact The Coastal Property Experts today to schedule your complimentary consultation.