Finally! Late last week, we got the clear to close from our mortgage lender. New house, here we come!
Brandon and I wanted a conventional, no-surprises kind of loan. I knew that my self-employment would probably be an obstacle, but we were pre-approved for a huge mortgage. Since we weren’t actually going to borrow as much as we could have (because whoa that feels risky), we hoped the process would be easy. Nope!
When we bought our first house in 2007, I was self-employed then too. But those were the days where you could just declare your income with a low doc (or no doc) loan, and be good. You know, those loans that contributed to the whole housing bubble and subsequent crash? Yeah, thankfully the banks aren’t doing many of those anymore.
So we knew the process would be different this time around. We had a lot of equity to go toward a down payment, but to qualify for the mortgage I had to give our full tax returns from the last two years, explain transfers and deposits from the last few months, provide bank statements from all accounts (business checking and savings, personal checking and savings, custodial kids’ accounts), do a choreographed dance routine, and recite a sonnet from memory. Then the market rates changed (for the worse, then for the better again), some documents changed, and I had to do it all over again. That was super fun! We needed help with debt and thus discussed some creative financing options with the lender, but in the end we were able to secure a good rate on a 30-year fixed mortgage. We’re happy. And relieved. (If you’re in the greater Chicagoland area and looking for a mortgage, or to refinance, contact me if you want the name of the woman that helped us. She was fantastic.)
Assuming everything is still on schedule, we’ll close on the house next Wednesday. Looks like my presumptuous “Our Victorian House” category title will hold up!
Kim @ Yellow Brick HomeAugust 12, 2013 at 1:02 pm
Choreograph a dance routine and memorize a sonnet? Yup. Sounds like the same things we just went through.
Hooray for the Victorian House!
Making it LovelyAugust 12, 2013 at 3:27 pm
Glad it wasn’t just us!
Emma B.August 12, 2013 at 1:15 pm
What an aptly timed post! I am in the process of buying my first home (a condo, where my boyfriend and I will be moving in together) — and I JUST went through this exact song and dance to get my mortgage approved (which it was!). Glad to hear it wasn’t my experience alone!
I’ll be closing (knock wood) this Thursday — after which you can bet I’ll be consulting lots and lots of your archived posts for some decor inspiration! :)
Making it LovelyAugust 12, 2013 at 3:28 pm
I hope everything goes smoothly for you on Thursday! Sounds like that’s the way mortgages are going these days.
Starr @ The Kiefer CottageAugust 12, 2013 at 1:16 pm
My husband has a boring ol’ 9-5 job and we had to jump through the same hoops when we bought our house a couple of years ago. Every day for weeks, it seemed we had a new request for paperwork or blood samples.
Making it LovelyAugust 12, 2013 at 3:34 pm
Brandon’s mom always joked that they were going to ask us for blood samples next!
Laura @ Rather SquareAugust 12, 2013 at 1:17 pm
Same here – although everything worked out in the end, we had to jump through many hoops during our mortgage process. But I think that’s a pretty standard experience these days. Congrats on having the clear to close!
katieAugust 12, 2013 at 1:31 pm
congrats.. hopefully all smooth sailing from here.
We did the song and dance last year… not fun.. I think I spent a whole day digging for docs and scanning them in and emailing to them to the lender…
Making it LovelyAugust 12, 2013 at 4:26 pm
Yep. Many days here, doing the same.
Jessica @ Sunday LovesAugust 12, 2013 at 1:53 pm
Super exciting, Nicole! Cannot wait to hear (and see) more, more, more!
SharynAugust 12, 2013 at 2:13 pm
It’s as if I wrote this post myself! I just tweeted this morn about how the banks have over-corrected their lending practices. It’s been such a humongous hassle – and neither of us is self-employed, we’ve been at our current jobs for > 3 years, have excellent credit AND 20% down. Oh, the frustration. Right this minute we’re awaiting the release of our loan docs (pending yet another verification of employment) so we can meet with a “mobile notary” to sign closing/loan docs and overnight them to our realtor in CA (we’re in DC still). Ok, just had to vent. Take (a little) comfort in knowing you’re not alone!
Making it LovelyAugust 12, 2013 at 4:43 pm
I hope you get your own clear to close soon! It is oddly comforting to know that others are going through the same thing, so hopefully hearing of our story helps you feel a bit better too.
Heidi S.August 12, 2013 at 2:14 pm
Congratulations and welcome to the Victorian Homeownship Club! Looking forward to what you have planned!
Making it LovelyAugust 12, 2013 at 4:43 pm
Thanks for the welcome! :)
Katy @ All Sorts of PrettyAugust 12, 2013 at 2:50 pm
Ah, that is SO exciting! We are buying a house for the first time and the process has been relatively painful, but I can’t even believe how exciting the prospect of OWNING really is. I’ve rented for 10 years, and now that I get to paint and take out walls, renovate the kitchen, etc I am giddy with possibilities. Congrats! I can’t wait to see what you do with the place!
Making it LovelyAugust 12, 2013 at 4:52 pm
Congrats to you, too! There’s nothing like that initial period where your brain is just going crazy with ideas and possibilities.
JodiAugust 12, 2013 at 3:05 pm
hip hip hooray!
Karen AAugust 12, 2013 at 3:11 pm
Congrats on your new home! It’s really cool to hear about your experience with the process of purchasing a new home. I’m not quite there yet but I like reading tips for when the time comes. :)
LaurieAugust 12, 2013 at 3:39 pm
Hooray! It is so nice to get past the fussy paperwork phase and be able to take action like pack a box or paint a wall. Something that shows PROGRESS!
Also, my mortgage company still doesn’t buy into the technology hocus pocus and makes me fax them documents. I’ve told them several times that I kind of don’t trust a company at this point in time that is that far behind the technology ball.
Making it LovelyAugust 12, 2013 at 4:54 pm
Fax! Good grief. I’m all for everyone getting on board the electronic DocuSign business. We did some of that for the contract to purchase our house, and it was so nice.
MaryAugust 12, 2013 at 3:47 pm
When we refinanced last year, we had the same song & dance to perform. The lending company was so busy that by the time they started to process our paperwork, the documents we had provided had expired. We had to re-submit all of our documentation a second time. After we sent them the second round of paperwork, several more weeks went by & we didn’t hear from them. I finally called & they said they couldn’t process our loan because they needed MORE paperwork. But they never told us. I guess they figured we were mind readers.
Fortunately, my daughter is a mortgage underwriter. She made a few calls for us & it was resolved.
BTW…We were in Oak Park yesterday. My daughter is looking for an apartment there. I was thinking about you.
Congrats on the house! Can’t wait to see it.
Making it LovelyAugust 12, 2013 at 5:03 pm
That’s crazy. I can’t imagine what a headache it would have been for you had it not been for your daughter. Is she the one moving to Oak Park?
MeAugust 12, 2013 at 4:31 pm
Nicole, you don’t need to write your posts for the GOMI forum. Really.
Congrats on the new house.
Making it LovelyAugust 12, 2013 at 5:07 pm
It’s just a coincidence! We got word late in the day on Thursday, my usual Honor Roll post was going up on Friday, so today was the first day I could write about all of this.
JulieAugust 12, 2013 at 7:25 pm
We are finishing up our loan as well. My husband had to write a letter to the bank explaining the memo “walking around money” in a check we wrote. The check happened to be to my father – – I don’t think the bank found it as funny as we did at the time.
LucyAugust 12, 2013 at 8:03 pm
Everyone I know, including us, had to jump through flaming hoops to close recently. Congrats on closing. Is that a photo of the entrance to your new home? If it is, it looks gorgeous already!
Making it LovelyAugust 12, 2013 at 9:06 pm
Yes, that’s the transition between the front yard and the back!
MicheleAugust 12, 2013 at 11:38 pm
How exciting for you! My husband and I are in the process of buying our first home and it’s so scary and overwhelming. We have our eye on a very well priced house that we are in love with but are waiting to hear back on how much we qualify for. I also joke they’re going to ask us for a blood sample and our first born child. It feels so invasive. I hope we have great news coming our way soon! I can’t wait to see all the beautiful things you’ll do to your new Victorian home. Love your blog! :)
XeniaAugust 13, 2013 at 6:04 am
In 1999 when I was purchasing my first house I was going for a conventional mortgage. Even though I was putting down more than half of the sale price of the house all of the banks still turned me down. The house I was buying was only $86K and I was putting down $60K. I needed to borrow only $26K, but I was turned down. I cried so much. I was so stressed out. The realtor could not believe I kept getting turned down. Every single bank said NO. Finally, the couple who owned the house set up a meeting with their lawyer and mine. They offered to hold the mortgage for me and that is how I ended up buying the house. They actually saved me money because there were no closing costs, or any other ridiculous extra charges that comes with getting a mortgage via a bank or mortgage company. Closing took less than 30 minutes to complete and I got the keys to my first home. My monthly mortgage payment was less than $300 per month. Eleven months after closing I paid off what was left on the $26k loan.
What I found out a year after closing when I went to buy a new car was that I had no credit history. My credit project was just a few lines that took up half a page. The car dealership had trouble finding a bank that would give me the loan for the car even though, again, I was putting a huge down-payment on it. The car was $22k and I was putting down $10k. I also had a solid job that I had for several years. I had no credit cards of ANY kind though. Since my mortgage was held privately by the previous owners there was no record of my timely monthly payments. Finally the dealership found a lender for me.
You would think that if you DON’T owe money it would be easier to get credit, but it is the OPPOSITE. If I had not lots of money, as long as I was making my payments on time I would not have had so much trouble getting loans.
I also learned that banks are not really interested in lending money for buying houses if the loan is for less than $50k. They feel it is not worth their while. They are in it to make loads of money, and anything less than 50k is a waste of their time and energy.
I also feel that at that particular time period, being a single woman was an obstacle in trying to secure loans. I am not sure if being African-American played a part, but it did cross my mind.
DeniseAugust 13, 2013 at 9:35 am
I wish you all the luck!!
You are very fortunated to recive that kind of mortage. In my country you can call yourself lucky if you get a 10 years mortage. Soy it´s 3 times more difficult to pay.
I with you the best, as allways!!
Nicki of Cute & Co.August 13, 2013 at 12:08 pm
Congratulations! I hope to build or renovate a new house within the next few years too, what an exciting time for your family! : )
jacqueline | the hourglass filesAugust 13, 2013 at 3:28 pm
Congrats! I’ll keep my fingers crossed for you that there are no surprises between now and closing.
SarahAugust 16, 2013 at 12:20 pm
My bro & sis in law have been house hunting in Oak Park too (they are on Ridgeland now). They said they had seen or considered many of the houses you did too! They found a house on Scoville & move in next month. Congrats!