Protect Your Purchase from low appraisals with a Backup Loan
FUNDED's auction platform helps you find the best loan while keeping your current lender on track. No need to cancel your existing loan.
This exclusive backup plan safeguards you from low appraisals, escrow risks, and purchase cancellations.
FUNDED creates a simultaneous 2nd loan option, at a massively lower cost.
Maintain peace and progress with the original pre-approval lender, while securing the lowest cost on your highest expense.
Is it OK to apply with multiple lenders and lock in rates?
Yes! This is a common strategy for savvy homebuyers. It helps you shop for the best mortgage and protects you from low appraisals and underwriting declines, which can end up canceling your purchase. And don’t worry about harming your credit - applying to multiple lenders within a 45-day window won’t hurt your score.
When communicating with your agent, don’t use the phrase “switching lenders” - this falsely signals instability. Instead, say “I’m creating a backup loan in case of a low appraisal” - you’re protecting your cash and the purchase deal overall. The agent and seller will love to hear that!
New construction home builders often require approval from their in-house lender before accepting an offer – that’s basically a large corporation protecting their sale with a back-up loan. Consumers have never been offered a similar process to protect their own interests - until now.
Why do I need protection from low appraisals?
A low appraisal can kill your home purchase — and cost you your escrow deposit. If the appraised value is less than the sale price, you might have to increase your down payment or cancel the sale. For example, if you’re buying a home for $1M with 20% down, you expect to pay $200k down and get an $800k loan (80% LTV). But if the home appraises at $940k, your max loan would be $752k (80% LTV), raising your down payment to $248k.
Without an appraisal contingency, if you walk away you’d lose your earnest money deposit. Both real estate agents would lose the commission opportunity, and the seller would have to place their stale listing back on the market.
So I don’t have to cancel the original lender?
Correct! Keep working with your current lender. We’ll help you maintain that option until your preferred loan is ready to close. FUNDED doesn’t interfere or limit your choices; we add value to what you’ve already achieved. We’ll guide you through the process and coordinate with both lenders, the agents, and the escrow officer - we guide you from start to finish.
The backup lender is asking me to electronically sign initial disclosures and an Intent to Proceed (ITP) form. Is it binding?
The ITP form is not binding, so it’s safe to sign and back out later if needed. You're only obligated on a mortgage once you've signed the closing documents. Signing the ITP allows you to keep that loan as a backup while exploring other options with better rates. Signing the ITP can only help you by securing the loan option, it preserves your locked loan terms and keeps your application open.
Will both lenders charge for an appraisal?
An upfront appraisal fee - or any upfront fee, like an “application fee” - is usually non-refundable once the appraiser visits the home. You can delay the appraisal on your backup loan to avoid extra costs. If the lender doesn't charge upfront or waives the appraisal, this won't be an issue. FUNDED will guide you through the process to ensure the best outcome.
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