Funny you should mention this. We initiated an application with a lender (not going to mention names yet, but it's a well known marine lender), providing all the information they requested except financial statements, which hadn't been compiled yet. I made it clear to the person I was dealing with that:
- We had not yet selected a boat, so could not provide specifics for the collateral. We did provide a maximum $$ we were looking for, along with proof of funds for the down payment.
- We would forward the financial statements as soon as my CPA had them compiled.
We were looking for Pre-Approval/Pre-qualification (in real estate parlance), so we wouldn't have to use a financial contingency in any offer we made. A week letter we received a turn down letter from the bank stating:
- Our income was insufficient for the amount of credit requested, and
- The value of the collateral is insufficient
Clearly there was a disconnect in that the application should never have gone to underwriting, as it was incomplete. It's a typical case of the bank
not listening to the customer. This was with a 791 credit score.
Suffice it to say that I'm thoroughly pissed! Now I get to start over, and there's a hard credit inquiry ding on my credit report, which will lower it 10-20 points for another 60-90 days.
I can go to Wells Fargo tomorrow, have my local banker fill out all the paperwork (so I don't have to), and get a mortgage on my house that will pay for the entire boat purchase, with no down payment. Remember, we own the house free and clear, and the only debt we have is a car payment. I can easily get a home loan if I make 6 figures... but I can't get a boat loan?