Maura Sullivan

Maura Sullivan ~ Your Northern Virginia Realtor

Many of the contract offers coming in are from buyers who are applying for thier financing through a loan broker. This means that the initial broker is doing all of the work necessary to package the loan information (verifications of employment, rental history, mortgage history, bank statements, other documenation, appraisal, etc.) required for underwriting approval.

This broker IS NOT funding the loan. The package is passed to a second party (lender, investor) who actually will provide the money for the loan. The loan package MUST be then approved by this secondary lender who may require additional information, documentation, field review, or occasionally a second appraisal.

The approval process almost ALWAYS takes longer than a traditional primary lender and often results in delayed settlement dates. This can be a problem in respects to loan locks, obtaining additional time off work for the buyer or seller and other various scenarios. **REMEMBER THAT EVEN THOUGH THE PRIMARY LOAN BROKER APPROVES THE LOAN, IT CAN STILL BE DECLINED BY THE FUNDING BROKER.** This is a situation where the purchaser can be in default of the contract and may stand to lose their EMD (earnest money deposit.)

Be sure if you're using a broker that Paragraph 9 of the VA Regional Sales Contract (Loan Application and Approval) reflects enough time to insure the brokered loan is truly approved.