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Bad Credit Mortgage Lender

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Anonymous
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Bad Credit Mortgage Lender

I'm in the Atlanta area and found a home that I wanted to purchase. My credit score was 496. I found a bad credit mortgage lender that would do an FHA mortgage with scores as low as 500 if I put down 10% and my interest rate would be 5.25%. The loan agent had me pay off some things and rescored me in June. I was a 535 so I got prequalified and was able to go under contract (this is a new construction home). By September my middle score had increased to 596. I had the lender rescore me and now my down payment was only 3.5% with a 5% interest rate. I am scheduled to close this Friday. Last week I noticed my scores increased again. My middle score is now 626. I asked would my interest rate go down the lender said yes it should go down to 4.5 - 4.75% but he wouldn't know until they ran my numbers again. I an 48 hours away from closing and haven't received a closing disclosure statement yet. I called and asked what do I need to bring to closing and how much my payments would be. Everything is the same from when my score was 596. They didn't change my interest rate, instead they offered me a lender credit of $1250. I asked for the disclosure statement and he said it wasn't ready yet. My loan has been approved from underwriting and has made it out of audit and is now with the closing attorney. How could they do all of that without sending me a copy of the disclosure?? Are there lots of red flags here or is it just me? I should have switched lenders when I got my score high enough but I wanted to be nice and let the loan officer get the sale because when I first started looking he was the only one that gave me positive feedback that it could be done - that I could get my dream home. Now I'm feeling like he knows how bad I want this home and even knowing that my credit is now good enough to go to another lender I couldn't do it this late in the game so they're pretty much stringing me along. How soon do I have to refinance? Is it 3 months or 6 months?

20 REPLIES 20
Anonymous
Not applicable

Re: Bad Credit Mortgage Lender

The time frame to refinance is in your loan documents. Make sure to do the math on refinancing.

 

Is this a fixed rate loan or an ARM?

Message 2 of 21
Anonymous
Not applicable

Re: Bad Credit Mortgage Lender

It's a 30 year fixed. The loan documents are what I'll receive at closing?

Message 3 of 21
NC_Mtg_Loaner
Valued Contributor

Re: Bad Credit Mortgage Lender

A couple things to point out here:

 

1. Congratulations---very few folks make it from where you were to where you are now and where you are headed.

2. Congratulations again--it really shouldn't be under appreciated that you've succeeded in making these changes and achieving your results.

3. TRID - RESPA requires that you've received a copy of your preliminary CD at least 3 days prior to Closing or  your Closing will be delayed--if you have not already received a preliminary CD, don't be alarmed--as long as you are 'sticking' with your current lender, you ought not to be worried because fees that you can't shop for are not allowed to increase by more than 10% so you should be able to look towards your LE to see your estimates of cash needed to close and you'll be in that ballpark unless you had additional inspections, more expensive insurance and closing attorney fees....

4. You still need to exercise a bit of patience--especially with what you are hoping to have changed---"repricing" your loan may require additional approval from the secondary department and they might only allow one change during the loan process so I only hope you haven't "started" the buying process too soon as you may still be stuck with credit data in your file from last month and not have the opportunity to act upon those recent changes within your credit profile.

5. Lenders are extremely busy so additional patience is often required when your file is "moving through the pipeline" and in this current stage... (often, as an LO we can't find more details or really reach out to our UWs whom we know are working on your file as well as 50 others who all deserve the same attention and are equally important)

6.  Interest rates being offered have been on the rise in the last month or so due to the most recent positive news in the economic front and this could be slightly offsetting your ability to lock lower WHICH really isn't a big issue, in my opinion because you could now focus on BEATING the BANK by paying extra principle early and often on your loan once it's closed so that you can limit the amount of interest you pay over the life of your loan.   (Just remember that any money you prepay on your mortgage should be considered as an investment and the real rate of return on this money is your loan's APR and in this economic climate where the market is up 30% in the last year and expected to continue growing IF tax reform is to fuel corporate America's global growth, you want to be certain your investments and assets are diversified)

 

.....whew, what else?

 

Congrats again!

__________________________________________________

Licensed NC Mortgage Loan Originator
Message 4 of 21
Anonymous
Not applicable

Re: Bad Credit Mortgage Lender

Who is your lender?

Message 5 of 21
me12345
Frequent Contributor

Re: Bad Credit Mortgage Lender

The answer to your question is 211 days...

You can do a "FHA Streamline" refinance after 210 days has past, that's how long before you can pull a new FHA Case Number after closing on your new loan. 

The good news is that the "Streamline" refi does not have all of the "Hoops" to jump through, its NO credit qualifying and NO income qualifying....Just a credit pull for your scores.

 

Thanks,

VA & FHA down to 550...
Licensed Senior Mortgage Loan Officer in the states of Arizona & California
Specializing in VA, FHA, USDA & Conventional loans. My company is also licensed in 12 states, Arizona, Colorado, Nevada, California, Oregon, Washington, Utah,
Alaska, New Mexico, Texas, Illinois and Florida
Message 6 of 21
Anonymous
Not applicable

Re: Bad Credit Mortgage Lender

I am in the same boat score wise. What was the name of your lender? I'm curious if they are licensed in PA.

Message 7 of 21
Anonymous
Not applicable

Re: Bad Credit Mortgage Lender

May I ask who your lender is?
Message 8 of 21
kc0039
Established Contributor

Re: Bad Credit Mortgage Lender

There are a lot of lenders here that offer 580 scores with additional guidelines from what you read

Licensed in IL
Message 9 of 21
Anonymous
Not applicable

Re: Bad Credit Mortgage Lender

I live in the Atlanta area as well and I’m curious who the lender is.
Message 10 of 21
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