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Frequent Contributor
Posts: 271
Registered: ‎03-05-2008
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Can you switch loan programs?

I have to go either USDA or FHA because I have a FC on record. Question is, let's say I get pre-approval for a USDA loan, but then find a house that's not in an eligible area and need to go the FHA route, does it matter? Presumably the pre-approval would be on the lender's overlay and when they submitted for UW it would be based on the house I'd selected and the loan program I needed? Is this correct? I know people here have switched to conventional from FHA and vice versa so assume switching from USDA to FHA or vice versa would not be unusual. Is there one over the other I should apply for and switch if necessary?

 

Also, if I had a pre-approval for, say, 90 days and didn't find a home in that time, do lenders typically extend after another HP to make sure the credit profile hasn't changed?


Starting Score: 2/2013 EQ 535
Current Score My Fico: 8/2014 EQ 654| EX 661 | TU 660
Lender Pull 11/4/14: EQ 679, EX 695, TU 703
Closed on mortgage 11/20/14

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Valued Contributor
Posts: 2,157
Registered: ‎08-24-2013
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Re: Can you switch loan programs?

[ Edited ]

No problem switching loan programs. Preapprovals are timed to the expiration of credit report .. 90 days. No worries.



Starting Score: 618
Scores on 10/9/13: EFX 652, XPN 669, TUC 662
Scores on 3/17/14: EFX 649, XPN 677, TUC 681
Goal Score: 720 ALL


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Frequent Contributor
Posts: 271
Registered: ‎03-05-2008
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Re: Can you switch loan programs?

Thank you EZ - you're becoming my personal mortgage advisor!

 

Another question because I know you did the Back to Work Program. If I apply now, I need to do it under back to work (or wait until Spring, which isn't the worst idea) so I need to do the counseling session. Found Springboard and I'm waiting on a call to set up a time - is the 30 day wait between counseling and applying 30 days between counseling and appying for pre-approval or between counseling and the lender submitting a final application to FHA UWs?

 

Thanks!


Starting Score: 2/2013 EQ 535
Current Score My Fico: 8/2014 EQ 654| EX 661 | TU 660
Lender Pull 11/4/14: EQ 679, EX 695, TU 703
Closed on mortgage 11/20/14

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Valued Contributor
Posts: 2,157
Registered: ‎08-24-2013
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Re: Can you switch loan programs?


songsofexperience wrote:

Thank you EZ - you're becoming my personal mortgage advisor!

 

Another question because I know you did the Back to Work Program. If I apply now, I need to do it under back to work (or wait until Spring, which isn't the worst idea) so I need to do the counseling session. Found Springboard and I'm waiting on a call to set up a time - is the 30 day wait between counseling and applying 30 days between counseling and appying for pre-approval or between counseling and the lender submitting a final application to FHA UWs?

 

Thanks!


I'm glad that you find my counsel/opinions and recommendations helpful.

 

The FHA rule requires the counselling to be completed 30 days before you apply fo rthe mortgage. I'd recommend that get that out of the way asap. I did mine with springboard and it ws one fee for both my wife and I.

 

The lender that approved my loan under the BTW program is up in Maryland. I'd be happy to give you the name if you pm me.

 

All the best as you move forward boldly to home ownership. You may post any questions here, or pm me if you prefer, and I will give you 100% hones and accurate information. I expected to have my clear to close today ... but have not seen it yet.

 

 



Starting Score: 618
Scores on 10/9/13: EFX 652, XPN 669, TUC 662
Scores on 3/17/14: EFX 649, XPN 677, TUC 681
Goal Score: 720 ALL


Take the myFICO Fitness Challenge
Frequent Contributor
Posts: 271
Registered: ‎03-05-2008
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Re: Can you switch loan programs?

[ Edited ]

Thanks EZ! I did the counseling with Springboard today and have my certificate. I found it useful and the counselor was great. I also heard back from the person I contacted at the local bank. They go as low as 640, but here's what she said about USDA:

 

"however, the guidelines for USDA for a foreclosure is a minimum of 36 months and for a judgement it’s 12 months. The satisfaction would need to be recorded for the judgement , you would have to prove the judgement was paid in 2/12." (Not sure where she's getting 2/12 from. If it's 12 months, it would need to have been paid by 6/13).

 

I wrote back back and said it was my understanding that USDA was following FHA when it came to less than 3 years from FC and extenuating circumstances. I said I was also considering FHA and asked if they were working with the Back to Work program. I also included info from HUD describing the program.  I know the judgment question is one that's been raised before, but my understanding is that if it were related to the same loss of income (the "event") that led to the FC, that it could be overlooked as long as it was paid.

 

I had a loss of income of 63% leading up to my FC. The counselor said I'm in good shape to move forward. If I can't find a local lender, I'll definitely pm you. :smileyhappy:

 

So . . . I guess I can seek pre-approval in mid-August!

 

congrats on the clear to close! Hope it comes in today!


Starting Score: 2/2013 EQ 535
Current Score My Fico: 8/2014 EQ 654| EX 661 | TU 660
Lender Pull 11/4/14: EQ 679, EX 695, TU 703
Closed on mortgage 11/20/14

Take the myFICO Fitness Challenge

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