Dual agency element complicates mortgage process

Mortgage officer: Bob Gerson, California Bank & Trust.

Property type: Singlefamily home in Morgan Hill.

Purchase price: $1.7 million.

Loan amount: $1.36 million.

LoantoValue: 80%.

Program: 10/1 Cmt index on our Portfolio Adjustable Rate Mort

Backstory: This client was referred to me from our tenant, a vice president who was looking to get prequalified with our bank at California Bank & Trust for a new home loan.

I had finished his application on a Saturday while I was out of town and to my surprise on Monday, he advised me that he was in contract two days before my prequalification was done. Of course, that meant he had another lender who provided the conditional letter sent over to the agent who was also the seller’s agent, and this is called Dual Agency.

The contract was at 35 days for the close, which now put our bank with less than 30 days to perform. The underwriting was done in two days, but biggest hangup was getting the appraisal completed in time.

We had bids that would take three weeks at more than $2,000 for this home which had five bedrooms and a pool with a diving board and an accessory dwelling unit. Our second bid came in at half the cost and would also need three weeks to complete. After several back and forth emails with our appraisal team, we were able to get this completed in two weeks, along with a technical review for loans valued at more than $1 million.

Our close of escrow needed to be extended by two weeks. Down to the wire, we completed a final approval and sent out the closing disclosures the same day to close on time. One other issue came up where the loan documents had to be redone, but again our team came through, and all parties are very happy to make this happen.

Stay safe everyone.

gage at 2.5% with no points.