Working mortgage 'miracles' at the last minute

Last week, I had a panicked call from a realtor I work with on a regular basis. One of her sellers had a sale that looked like it was going to collapse. The seller was counting on the sale of the home for the down payment of her next home.

The realtor called at mid-day last Wednesday. The sale was supposed to complete on Friday.

She asked if I could talk to the purchaser and potentially arrange financing for her.

Before you read the next part, this is not intended to single out any particular bank or mortgage person. It could just as easily be a mortgage broker or a branch employee.

The back story is the purchaser had been working with a mortgage specialist from one of the chartered banks since mid-December. The specialist gave the client the go-ahead to remove her financing subject on Jan. 17.

The specialist then said they needed to extend the closing date by a week and then, by another week. Then she told the client she would have to come up with 20 per cent for his down payment. The client scrambled and came up with the additional money needed for her financing to be approved.

I might not have believed this story except I did see the email chain. So what actually happened? My guess is the mortgage specialist did not have an approval in place with the insurer or her bank when she gave the client the OK to remove her financing.

The client had not seen, nor signed, any mortgage paperwork before removing her financing subject. She trusted her mortgage person had things well in hand, being as she was told she was approved and things were fine. The buyer in this case a first-time home buyer and did not know anything different.

I have pulled off the odd miracle in my days but I had serious doubts about being able to help this client in one day, especially as she was buying in a smaller remote community so we had fewer options.

We were working on her application and at 6 p.m. on Wednesday received word that the bank she was originally working with had come through and would send mortgage instructions to the lawyer the following morning (we were now at the day prior to closing).

When you are purchasing a home and applying for mortgage financing, I feel it is so important to work with a team of professionals who have your back.

As someone who has never bought a home before, or maybe hasn’t done so in many years, it’s important to do your homework and understand the process. If you think things are going sideways with your financing, please make sure you ask questions to better understand what’s happening. If you have a feeling that something is really wrong, don’t wait until you have no other options.

When you choose a mortgage professional to work with (and a realtor for that matter) do a bit of homework. Ask your friends who they have used and what their experience was like.

Buying a home is stressful enough on a good day but what this poor client went through could have been avoided had she had a better idea of what the home-buying process was supposed to look like.

This article is written by or on behalf of an outsourced columnist and does not necessarily reflect the views of Castanet.