So Rocky calls me back and immediately starts quoting some rates. I couldn’t get it all it was so fast but here is what I caught: 7.5% if I want the $395 option, 6.85% if I pay for closing costs, and 6.35% if I pay 2 points. I asked him to repeat it but he insisted that all he was trying to do was explain to me in general terms how the more I paid up-front the lower the rates. I told him several times that I understood that, and asked for specifics. He then told me that the numbers he quoted me earlier were just hypothetical and that it would depend on each person’s individual assessment. So much for the quotes. We then started down the path of entering numbers into their “automated system”.

All was good until we got to the part where he asked about W2s. My girlfriend has her own design shop which she has run for 2 years. Her business generates a decent income and of course when you run a business you have expenses that you can place on your Schedule C profit and loss to arrive a taxable “net profit”. As a W2 wage earner these expense deductions are not available to you, so even though you may still have the same expenses it cannot be used to lower taxable income. Well, I told Rocky that the AGI was about $51,000. But he told me that he didn’t care about AGI, he just wanted me to report the Schedule C profit and loss. Well that was significantly lower - to the point of not qualifying for the $100,000 first loan let alone the second loan. He wasn’t interested at all in any capital gain income or any other dividend income unless we can show that we have had it for the past two years and that we will have it for the next three years. For self employed people the only numbers they are now going to accept is Schedule C profit and loss. Throw everything else away.

Faced with this roadblock, I decided that DiTech is a no go and will continue tomorrow, first thing will be to call back Citibank and see how far the approval process we make it…