A Case Study: Brandon & Manjinder Sidhu
Senior Mortgage Advisor
Justin Kautz Senior Mortgage Advisor
Published on January 25, 2022

A Case Study: Brandon & Manjinder Sidhu

Are you a first-time homebuyer that’s worried you won’t be able to get preapproved? In this video, I’m going to share the story of Brandon and Manjinder, my clients that almost lost their dream home because of their big bank lender. We’ll find out how we were able to get them preapproved and close on their home in just eight days.

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Brandon And Manjinder’s Story

Brandon and Manjinder Sidhu, first-time homebuyers, were in contract on their dream home with their big bank lender. However, their big bank lender dropped the ball at the last minute—and almost dropped their house. The Sidhu’s thought that there was no way another lender could step in and pick up where Bank of America fell short.

The pair were in contract on a 30-day escrow and everything was going smooth—until the 37th day when Bank of America said that they could not finance them any longer. That’s when their rockstar real estate agent in Fresno, Casey Chumley, reached out to me. We were actually able to save the deal—and I’m going to show you how.

Dropping The Ball

The Sidhu’s were preapproved with Bank of America. They were supposed to close on the 30th day of their escrow, but as time went on, they weren’t getting any feedback or phone calls from the lender. Seven days past their close date, Bank of America tells them that they cannot do their loan because they don’t have three trade lines for 12 months.

Verify your mortgage eligibility (May 17th, 2022)

Unfortunately, Bank of America was done at that point. The seller was about to cancel the contract and everybody was royally pissed, including the listing agent, the sellers, the buyers, and their agent. They were also obviously super frustrated and scared at the same time.

The first thing that a lender does is take an application online or in person, put the application together, and should run it in an automated underwriting system—which Fannie Mae and Freddie Mac both have. This happens on VA, FHA, conventional, and jumbo loans. When you run it through, you get an automated approval and figure out if there’s anything that stands out that you can’t do for the buyers. That is what a thorough pre-approval is.

Someone must have dropped the ball along the way, but fortunately, there was a solution.

Verify your mortgage eligibility (May 17th, 2022)

Understanding Overlays

Once I found out what was going on, I was 99% sure that we did not have the same issues that Bank of America, Wells Fargo, Bank of the West, or all these big banks have—which is something called overlays. Overlays are self-made guidelines by the bank, layers of risk that they add on top of the other guidelines of Fannie Mae and Freddie Mac to protect themselves.

These big bank lenders can basically say, “I don’t want to do that, I don’t want to do that, and I don’t want to do that.” However, as a wholesale lender, I can work with many different banks and lenders. I choose to work with lenders primarily that do not have any overlays and who are efficient.

Saving The Deal

Once the borrowers applied with us, we immediately ran their application in the Fannie Mae and Freddie Mac—or the DU and the LP—and fortunately, we got both of them approved. We knew we didn’t have any overlays for trade lines. We submitted the loan the next morning and got an underwriting approval in about four hours.

Verify your mortgage eligibility (May 17th, 2022)

We also had an appraisal waiver, so we didn’t need to get an appraisal. We submitted everything, got the approval, and closed the loan in eight days (including a weekend). We were able to get the buyers the house they wanted, and now they’ve moved in and love their new home.

I’m Here To Help

The next time one of your friends or family tells you that they cannot get pre-approved to purchase a home when they’ve talked to Bank of the West, Wells Fargo, BMA, or your local lender, think again. Brandon and Manjinder thought the same thing, but they were pleasantly surprised.

So if you find yourself in the same situation or have friends or family that need help, please feel free to reach out to us and we’d be happy to help. You can also subscribe to my channel so you never miss an episode of my show, and make sure you stay tuned to see what I feature next!

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Senior Mortgage Advisor
Justin Kautz Senior Mortgage Advisor
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(949) 662-2987