Tracy Byrnes
And you know that a late mortgage payment is a big black mark on credit. While it might not be your fault, you don't want to fight the fight of trying to clear your name with the credit agencies.
So attempt to get a loan with a stable loan company (which seems to be an oxymoron these days). Just don't go on the Web! Lendingtree.com and Ditech.com may offer ridiculously cheap loans, but then they hit you with exorbitant fees and penalties that are barely disclosed in the offerings. "They're like the slimy car salesman," says McConnochie. "Too many people get loans on the Web without knowing the whole story." Start with your local bank, and get a real person in front of you. Ask questions. Make sure you understand the specifics. Get a good-faith estimate and compare it with your other offers. Now, if you're in the middle of the mortgage application process and your lender decides to shut its doors, I'm sorry to say you're out of luck. There's basically nothing you can do but move on to another lender. Any fees you paid, for credit applications, appraisals, etc., are all sunk ... lost ... gonzo. Not to mention the time you invested in trying to get the loan. However, if you still want to buy the home, you should immediately contact the sellers. Odds are they're selling their home to you because they know you can get a mortgage. Well, right now, you don't have a mortgage because your lender is going belly-up. If you still want the house, ask the seller for an extension on your contract so you have time to get another loan without losing the house. "Get an addendum that gives you the right to get a loan somewhere else," suggests McConnochie. You clearly need more time to get pre-approved for a loan now. So don't panic if your mortgage company decides to shut its doors. Just be proactive and get yourself out of there ASAP. And this time, get yourself into a fixed-rate loan. The interest rate may be a bit higher, but in the long run you'll sleep better.
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