Did your mortgage company make you mad? Did your loan officer make all sorts of promises and didn’t keep one of them? Thinking about changing mortgage lenders midstream before your escrow closes?
Such a switch is, to put it mildly, cumbersome. It’s not a situation where you can transfer your loan application and all the associated documentation or picking up the phone and screaming, “You guys suck!” and your loan approval is magically transferred over to your new, accommodating lender.
For starters, you’ll need to complete a brand new loan application. Once that is completed, you’ll receive a whole new set of loan disclosures, estimates and lender forms. And that appraisal you paid for? Yeah, you paid for it, but it really belongs to the lender, not you. You are entitled to a copy but if you look close on the front of the appraisal it says something to the effect of, “Prepared For: Mortgage Company.” Lenders have the option of transferring an appraisal from one lender to the next but the paperwork involved along with the time it takes to get the transfer completed, your new lender will likely ask for a new appraisal.
You will complete a cancellation form with your old lender and a request to have your loan transferred but really all that is transferred are the items you provided such as pay stubs, tax returns and bank statements, copies of which you already have. Internally generated documents by your old lender stay with the old lender.
And if you’re running out of time, it might be too late to transfer your loan anyway without getting an extension from the seller or risking blowing an interest rate lock. When dealing with a sales contract, time is of the essence and transferring your mortgage just because you’re mad may not be the best excuse to ask for an extension from the seller. You run the risk of losing the home, your earnest money and your pride.
Don’t get me wrong, if you’re totally getting screwed then transfer your loan, but if you find yourself simply frustrated with it all, have a cup of chamomile tea and rethink your motives. Sometimes simply grinning and bearing is your best move.
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