BOA REO Prequalification Requiring 20% Down

[Jerry Calhoun]

Hi Everyone... Ok, this is my very first post on just about anything ever so please bear with me as I try to get my thought out coherently.

I am interested in bidding on a BOA REO and one of the requirements, as most of you here already know, is to prequalify through them even though I already have financing lined up. Anyways, I went through their prequal procedures and was granted their approval letter but they are requiring me to put 20% down instead of the 10% that I have already been approved for by a different lender.

Due to the nature of my current employment they were excluding some of my annual salary even though I have been receiving it for the past 6 years and have no indication of not continuing in the future. The BOA officer said I still qualified just with my base salary but was adamant about requiring the 20% down even though this is to be my second home and should not have to be considered an investment property. I have the 20% to put down but would rather keep the additional funds if possible so I can invest in another property, though that was never mentioned to the loan officer.

My question is.... does this mean they will verify at closing or something that I have obtained financing for 80% rather than the 90% I already have? Would they not close if I still went with the 90% funding? Any advice?

Thanks much in advance for any tidbits of wisdom out there....

[Chris G.]

Originally posted by Mitch Kronowit:

I'm super tired, but the way it sounds to me is that BOA tool simply needs to pre-qual you according to their guidelines which requires 20% down. That's it. It's just for pre-qual purposes. After you have that, how you actually succeed at closing escrow is really none of their freekin' business.

This is exactly as how I understand it as well.
No need to get frantic about it.
You are fine. You have been pre-qualed with BOA for the loan WITH 20% down -- which is what their requirement was -- to make sure you are Qual'ed with BOA.

However, since you are not financing with BOA then the 20% does not make a difference to you.

They just want to make sure that you are capable of being qualified for a loan from BOA in case your back-end financing does not pull through, that way you can still buy the house and cant back out of the contract.

So if your back end financing does fall through, you will need to finance with BOA, and they will require 20%.