Automated Approval - Underwriter Says No

[Anonymous]

I am new here and I read the post all the time, so here's my story. I got an pre-approval for an FHA loan through an automated system, provided all documentation but underwriter denies it.  I know I had a couple of bumps on my report but had paid almost everything off accept some old medical that I did not believe was mine.  My scores were in the mid 600's and I did not have any lates in the past year.  My question is to the mortgage exports, does this happen often? What might cause this? I don't know what is wrong because my LO hasn't contacted me yet, just left a message on the machine saying she was trying to see what went wrong, will get with the underwriter and get back with us. 

In a way I am glad it happened now because I am not under any contract or time constraints but I don't know what to do. I am so frustrated and am on pins and needles awaiting the call from the LO to see what went wrong.  I am just about ready to throw in the towel! The thought of getting a larger home for my family just does not want to seem to come through. I am just so tired of getting the door slammed in my face, just when I think everything is right, and I climb 2 steps forward, I am immediately knocked 10 steps back. 

[Anonymous]

1 of 3 things are likely

One, some restriction or underwriting change had gone into effect

Two, something has changes on your credit report

Three, the info provided did not match the proof provided.

When there is automated approval, they are basicly just re-checking the info provided against the hard data recieved. 

The other thing is if you already have ahouse approved and all, they may have an issue with the house itself.

Wait until the LO gets back to you....If you have:

620+ scores

the down payment

good income/DTI

no lates in 12 months

24months same field w-2 employment

FHA should be a go as long as the property fits the contract (i.e appraisal)

[john398]

Well if you paid some collections since the approval that maybe the issue because that may of brought them active again and a $0 balance collection can be just as bad as one with money on it

Was the LO the one wthat recoment taking care of the bumps?