Mortgage insanity

Julie, we had a similar sort of nightmare ourselves - my hubby has only been self employed for two years so didn't have the usual 5 years worth of books... I have only been in my current job for a year, so no mortage company wanted to lend to us at all, unless we had a huge deposit to put down...... we eventually found a bank who said they would do it - got right down to just signing the mortgage agreement, and they pulled out. We had to find another one and QUICKLY!! We eventually found what they call a "Self Certification" Mortgage which they do specially for slef employed people, we just got a mortgage twice the price of the our current one, within a week or so, all they wanted was a reference to say that I was currently in permanent employment, and a letter from my hubbys accountant to say the business was still running, along with the last years mortgage statements. They didn't want employment histoy or bank statemenst or even proof of income.... as long as they know you are both making money and have kept up with your mortage payments they don't mind..... it saved us!!

ACK?!?! Whats going on?!? Why has this post gone to the top of the thread!?!? Eeeks!! I hope the sites not going crazy again... ?!?

I think it is going crazy! It said you posted 3 days ago... even before I started the thread?!

Anyway, thanks for the advice. It's hard to believe that banks do that to people an something as huge as a house, back out at the last minute, that is. I'd totally freak! I'm glad you found a solution, though. I'm sure we will, too, it's just so frustrating to wade through all the crap to get to the end.

So here's our situation. My husband and I have a house that we bought two years ago. We bought it for $120K (5% down for first-time homebuyers), we are told by a local realtor that we could now sell it for $180K. Since we have both been unemployed in the past year and have been struggling financially, just making ends meet, we have made the decision to "downsize" and buy a less valuable house. We plan to use about half the profit from the sale to put a 25% downpayment on the new house (resulting in a much smaller mortgage payment), while the other half we will use for selling and moving expenses and paying down as much of our debt as possible.

So what we want to accomplish is having less debt and a smaller mortgage. And the bank won't let us.

Since my husband has been at his job less than a year and I have just started my own business 9 months ago, our bank refuses to let us apply our current mortgage to a new home, even though it is "portable". We would have to qualify all over again, and we simply don't. Apparently, they are confident that we can continue to afford higher mortgage payments while carrying more debt, as opposed to a lower mortgage payment with less debt. It is illogical that they think the second situation is riskier. We even offered to sign legal documents saying we would pay off a certain percentage of our debts, as in a debt consolidation loan, but they were still unwilling.

They say they need to have employment of one year or proof of business income for three years to qualify an income for a mortgage. So according to them, we have no income. Yet, we manage to make our mortgage payments every two weeks, have never missed any, even during the 4 months we were *both* not working (we lived off employment insurance, severance pay and savings).

We are talking to a mortgage broker, and he seems fairly confident that he can get us a mortgage, but he was supposed to call us back yesterday morning, and here it is 2 in the afternoon today and no call yet. Given our experience up to now, it wouldn't surprise me a bit if he couldn't do it for us either. But I have hope that by trying to do the right thing we will move in a positive direction.

Any advice? Has anyone else been in this situation? Thanks for letting me vent...

We are looking into whether or not we qualify for a loan, and I can tell you that mortgage brokers do not always get back to you when they say. We just had one who said we would hear something from him Monday at the latest. He finally got back to us Wednesday afternoon.

Did your husband change careers or just companies? From what they told us, as long as you are working in the same field switching companies isn't that big of a deal. (I'm dealing strickly with that the mortgage broker told us. I know we wouldn't qualify with a bank as their qualifications are much stricter than some of the mortgage companies.)

I would bet that some mortgage company will be willing to finance you, especially since you have equity in your home now. If they think they can get financing for me and my hubby, they will finance anyone!

Yeah, our mortgage broker told us the same thing re: switching fields vs. workplaces. My husband fits into that category, but my business is in a totally different field than I used to work in.

Thanks for your first comment, too; it makes me feel a lot better. There's nothing like anxiety and anticipation re: money matters, eh?