topic Under contract and score dropped - advice please! in Mortgage Loans

Under contract and score dropped - advice please!

violetsmom — Thu, 06 Dec 2012 00:47:32 GMT

My husband and I are under contract to have a new home built. We were pre-qualified before signing the contract and our contingency for financing was up 2 days ago. Our mortgage lady went to pull credit to get everything lined up on Monday and WHAM! My husband missed a student loan payment while he was traveling overseas for nearly a month, it had not yet been reported when they pulled for pre-qualification.

We already have an FHA loan (we are planning on renting out our existing home), so we have to go conventional. We also have to have PMI because we don't have enough down payment. His score is now too low to get the score where it needs to be for PMI. Once we have the statement that the account is current I am hoping that improves it a little. They extended our contingency for another 2 weeks but at this point I don't know if there is any point. I have called and pleaded and begged with numerous supervisors and no one will help. I have sent GW letters to several email addresses and via their website.

Does anyone know, on a conventional loan will an underwriter even look at a file without the proper credit score, even it it is close and with a letter of explanation? I am emailing and calling the mortgage broker like a mad woman and she is just not giving me the time of day :(

Re: Under contract and score dropped - advice please!

tooleman694 — Thu, 06 Dec 2012 01:34:06 GMT

Yeah its over

2 big problems

1st - I dont see an underwriter approving you with a late that just happened. Its gonna be a tough one to explain.

2nd - The lender will need to insure the loan, and they have their own guidelines. Typically you need a minimum of a 680, or a 660 if you backend ratio is very very low.

Re: Under contract and score dropped - advice please!

Mongul — Thu, 06 Dec 2012 10:55:19 GMT

I have a student loan through US Dept of Education - just a straight student loan. A few years ago I got in a situation where I missed a couple payments. I called to try to take care of it, and they offered me something called a "forebearance" - basically they took what I hadnt paid and stuck it on the loan, and I just made my payments as normal. When they did that, they did it effective when I FIRST missed the payment though, and reported it to the credit bureaus as such - clearing up the lates. Now I wasnt checking my credit then like I do now, so I don't know how long it took - but if they would give you one of those forebearances, and then send you or fax you a letter, saying they did? I dunno - maybe it'd be something? Or maybe your particular loan doesnt allow that? I have no idea - just thought I'd chime in.

Re: Under contract and score dropped - advice please!

tooleman694 — Thu, 06 Dec 2012 13:50:08 GMT

If that would work, that would be very cool.

Re: Under contract and score dropped - advice please!

Mongul — Thu, 06 Dec 2012 14:53:50 GMT

Yeah, when I called - at least for MINE, back in the day - when I suggested that I just pay what was past due, they OFFERED the forebearance - it was like, their "go to" response I guess. I'm actually surprised that the OP didn't get that option - unless not all student loans etc work the same.

OP - try to call them back maybe and see if they'll do a "forebearance" maybe?

Re: Under contract and score dropped - advice please!

tooleman694 — Thu, 06 Dec 2012 15:20:45 GMT

Wonder what the underwriter would think about it.

Re: Under contract and score dropped - advice please!

violetsmom — Thu, 06 Dec 2012 16:42:16 GMT

I am not sure that we would really qualify for a forebearance though. My husband was sent on a last minute overseas trip for 3+ weeks and had very limited internet access, or free time to even think about anything other than what he was working on, and made the payment when he got home. I don't think that would qualify as a hardship really, heh. Maybe it wouldn't hurt to try though...

Our mortgage loan lady is not telling us all hope is gone though. She has asked us to send in the statement showing the account is current and $0 balance due. We have that now, and the stupid letter now also says we are pre-paid through February so I am not entirely convinced the late payment reporting is completely accurate.

Sigh. This sucks so bad. I am so sad. I wish they would just tell me to give up hope so I can move on. :(

Re: Under contract and score dropped - advice please!

violetsmom — Thu, 06 Dec 2012 17:03:11 GMT

Oh, and I am pretty sure he is currently at 650 after the late payment hit. Maybe once the report shows the account is current it will help a little?

The builder and the lender are the same company as well...

Re: Under contract and score dropped - advice please!

deg757 — Thu, 06 Dec 2012 20:35:36 GMT

Don't put the loans in forbearance. It was a big issue with my mortgage. I had to take my loans out of forbearance before anyone would insure the loan. Almost killed mine. Don't do it.

Re: Under contract and score dropped - advice please!

fishbjc — Fri, 07 Dec 2012 14:49:32 GMT

Is your builder Putle, by Chance?

Re: Under contract and score dropped - advice please!

violetsmom — Fri, 07 Dec 2012 21:15:00 GMT

No it isn't...

Re: Under contract and score dropped - advice please!

violetsmom — Sun, 09 Dec 2012 18:54:45 GMT

Now that I have spent hours pouring over payment history to figure out how this happened I think I may have a more convincing explanation as to how this late payment thing happened then just oops I forgot.

This is my husband's student loan the late payment got reported for. He has had this loan for years and years and has always gone in every other month or so and scheduled out the payments for the next few months. I can go back through the life of the loan and see this pattern, he is almost always paid a month or two in advance even. On Jan 3 this year he scheduled 2 payments, for 1/4 and 1/23 to cover Jan and Feb. Then the next payment doesn't appear until May 13, but he scheduled 3 payments approximately 3 weeks apart to cover (what he thought was) May, June and July. He was under the assumption that he had paid March and April a few months before as he always had. He didn't know he ever missed a payment until we got blindsided by this the other day. He of course doesn't exactly recall going in to schedule these payements as it would have been in March. However in March he also was told last minute that he was going on a whirlwind international 3 week trip to rural China, Japan and India. He had extremely shady internet connection, and I would not be surprised if he tried to go in to schedule some payments (all his other obligations were taken care of at this time, so I have to believe he would not have just randomly forgotten his student loan bills) and possibly couldn't get in. Not that would be ACS fault obviously, but I want to go through his emails and see if there is anything at all from them at that time frame. His report says he was late in September and October, even though he made several payments in August and September (they were just applied to previous unpaid months, unbeknownst to him. They never chaged any late fees at all which further leads me to understand how he just had no idea he was late).

If I can't find any way to prove he actually did schedule those payments, I can at least try to get someone a shred sympathetic on the phone to look at the payment history with me to see how this happened and this latest late payment report is a hiccup from something earlier this year that we didn't even realize was a problem until now. At the very least this scenario is much easier to explain to an underwriter with payment history to back me up than just "oops we forgot".

Sorry if you actually read this. I can't stop thinking about this and need to get it out somewhere :)