KIRO Radio's Tom Kelly digs deep into the Puget Sound real estate market
Real Estate

Note from doctor? Loan details move from picky to odd

Underwriters are being extra vigilant in verifying every detail of a mortgage application, and some of their requests for information, borrowers say, are downright odd.

For example, one borrower says an underwriter demanded a letter from his doctor that an illness he had would never come back, the Chicago Tribune reported. Another borrower says that an underwriter told her she needed to get verification from her employer on her employment status when she listed "homemaker" as her occupation.

A borrower said an underwriter asked him for a letter of explanation on a $6 deposit he made (the borrower earned $10,000 a month at the time).

"I don't know whether to laugh or cry," says Karen Deis, who operates MortgageCurrentcy.com, and who collected dozens of anecdotes on her Facebook page about bizarre underwriting requests. "People are scared. All you hear about are buybacks, audits, and people losing their jobs" because they didn't verify this or confirm that.

Banks are requiring more documentation when approving a mortgage, and some of the extra requests have caught borrowers off-guard.

For example, Deis says one borrower said that an underwriter demanded a letter from her explaining why she changed her name after she got married. A single father who had custody of his child said he was asked for a letter saying he did not have to pay child support. Another borrower who had been out of school for years said he was asked to produce his high school transcript.

Despite some of the extra documentation requests, recent surveys are showing that banks lately are easing up slightly on their underwriting standards.

However, "even though there has been some loosening, what they're asking of people is not changing," said Jonathan Corr, Ellie Mae president. "It's still pretty comprehensive, and we're going to continue to hear stories like this."

Top Stories

  • Underwhelming
    Dave Ross envisioned an Imperial Directive saying borders are open, but that didn't happen

  • Playmaker Needed
    Who can the Seahawks absolutely count on to make a play in a big spot Sunday?
ATTENTION COMMENTERS: We've changed our comments, but want to keep you in the conversation.
Please login below with your Facebook, Twitter, Google+ or Disqus account. Existing MyNorthwest account holders will need to create a new Disqus account or use one of the social logins provided below. Thank you.
comments powered by Disqus
Listen to the show
Hear Real Estate Today on KIRO Radio
Join Tom Kelly every Sunday at 9am on KIRO Radio to talk Puget Sound real estate.

Sign up for breaking news e-mail alerts from MyNorthwest.com
In the community
Do you know an exceptional citizen who has impacted and inspired others?
KIRO Radio and WSECU would like to recognize six oustanding citizens this year. Nominate them to be recognized and to receive a $2,000 charitable grant.