AUTOMATIC UNDERWRITING

[Anonymous]

What is usually the qualifications for automatic underwriting with a FHA loan...is it because all scores are over 600...or are there more factors included???

[DallasLoanGuy]

scores arent all of it. they grade the credit themselves.

also looking at stuff like assets.

[DallasLoanGuy]

in other words.... there is no minimum score for automated underwriting

[danev2]

Please explain automatic underwriting. Can an FHA loan be run through manually for a person with less than the 620 minimum?

Also is the min 620 or 625? Do all three need to be above 620? or just the middle?
i.e. TU 629 EX 621 EQ 598?

thanks

DV

[Anonymous]

My scores are below 600, on all three of them, as of 4/11/08.  Around that same time, I got pre-approved for an FHA loan and have now found a house and we are going through under-writing right now.  But the lady at the bank (Chase) said I've never seen a "Yes approval" on the system and the under-writers turn around and say "No."

So maybe FHA has lowered their scores pre-requisites again?

[DallasLoanGuy]

danev2

what happend to danev1?

my company stops at 580 minimum for manual. i know a guy that still does them down to 500 but i dont expect that to last.... neither does he.

below 620 i have to ding my clients for score. not bad.....    .25% premium to rate.

everything below 580 is manual.

we toss the high and low score. factor off the middle score.

automated underwriting is a computer program that approves/accepts loans or refers them to manual. it grades everything. length of employment, credit score, the credit itself, down payment, ect, ect.

if approved with automated, you get to use the debt ratios that you have been approved for instead of the rigid manual debt ratios.

let me know if ths is as clear as mud or not.

[DallasLoanGuy]

keeanah

garbage in / garbage out

if the data inputted into the automated undderwriter is accurate, then the approval from automated is the 'golden ticket'

[Anonymous]

Dallas - I'm not sure what you were trying to tell me in your last message.  Are you saying that if the LO put my information in correctly, and the automated system said yes, there's no way they will manually say no?

[DallasLoanGuy]

keeanah

i am saying that if the loan officer can prove everything they put into the computer, you have a deal.

can it be denied? yes, there can be some things overlooked"

like 401k. if it is used as an asset to qualify, then you have to have access to it.(you dont have access to 'retirement accounts' because they arent really 401k)

the LO could have used bonus/commission that is not qualified.

ect

ect

if the loan officer is pretty decent, then you should be good.

i denied a borrower a week ago.... their debt ratio was too high. the realtor called me today to inform me that the chase loan officer's deal wasnt good. most likely because the chase bank LO was a newbie and didnt really know the inner workings of loans.

i can approve anyone for any amount if i put in bad numbers.... but those numbers have to be verified.validated.

i have hope that the LO who has never seen an automatd file denied.... has seen more tan a few files and can take a proper application.