Reply
New Contributor
Posts: 54
Registered: ‎02-03-2008
0

Having problems getting thru underwriting... suggestions?

Working with a broker who is working with the lender.  I'm trying to prove my income and having problems pleasing the lender.

 

So far, in regards to income verification, I have provided:

 

  • copies of 2008, 2009 and 2010 tax returns (including 1040 forms and schedules for personal taxes as well as 1065 and K-1's for a small partnership I am in).
  • W-2's from all employers from 2008, 2009 and 2010  (I changed jobs in 2010).
  • direct deposit paystubs from my employer
  • bank statements (which show the direct deposit amounts from my pay)
  • letter from a CPA certifying my 2010 taxes were completed (they have not yet been processed by the IRS).
  • copy of check cashed by the IRS for 2008 taxes
  • IRS tax account statement and transcript for 2009 taxes
  • Letter from my employer's HR department to indicate my employment history

 

My W-2 income, by itself, is enough to support the mortgage.  I am not relying on the partnership to support me (in fact, the partnership is ending at the end of this month).

 

The lender has responded that the information above is not enough to prove my income; they asked that the CPA sign page 2 of my 1040 for tax year 2010.  So he did and we sent that onwards.  We've had dead silence now from the lender for the past four days.

 

The loan is for $240,000; the property appraised at $300,000 so we fit the 80/20 ratio to avoid PMI.

 

The monthly Principal & Interest payments would be 19% of my gross income.  Add in escrows for taxes and insurance, and the monthly mortgage payment is about 25% of my gross income.   I have another 8% of my gross income that goes to student loans, car payments, real estate taxes and house insurance, so that my total debt-to-income ratio, with real estate taxes etc., is about 33% of my gross income.

 

My credit scores were all 750+. 

 

From my perspective, it seems to me that the lender almost doesn't want to make the loan. They get a piece of information in, then wait 3-5 days, then ask for something else.  We slid past the rate lock two weeks ago.

 

What am I missing that is making me such a terrible risk? 

 

the basics:

 

single family home in a stable market (per appraiser's report)

20% equity

escrowing taxes & insurance

P&I equal 19% of gross income

sum of all debts + real estate taxes + insurance equals about 33% of gross W-2 income

credit scores all 750+

 

The last time I went through a mortgage application process where the lender needed tons of documentation, the last thing I had to sign was an agreement that I wouldn't get pregnant for at least two years.  That was back in 1985 - I've heard that such agreements are no longer legal.  As a point of curiosity, does anyone know when it might have become illegal to require that kind of documentation?  (Just in case they ask for that this time too). 

 

Thanks,

 

Helaurin

 

 

 

 

 

 

 

 


Starting Score: 2014 775
Current Score: 822
Goal Score: 840


Take the myFICO Fitness Challenge

Copyright ©2001-2015 Fair Isaac Corporation. All rights reserved.   | Terms of Use | Privacy Policy | Sitemap

IMPORTANT INFORMATION: All FICO® Score products made available on myFICO.com include a FICO® Score 8, along with additional FICO® Score versions based on Experian or Equifax data (additional FICO® Score versions based on TransUnion data are not currently available on myFICO.com). Your lender or insurer may use a different FICO® Score than the versions you receive from myFICO, or another type of credit score altogether. Learn more

FICO, myFICO, Score Watch, The score lenders use, and The Score That Matters are trademarks or registered trademarks of Fair Isaac Corporation. Equifax Credit Report is a trademark of Equifax, Inc. and its affiliated companies. Many factors affect your FICO Score and the interest rates you may receive. Fair Isaac is not a credit repair organization as defined under federal or state law, including the Credit Repair Organizations Act. Fair Isaac does not provide "credit repair" services or advice or assistance regarding "rebuilding" or "improving" your credit record, credit history or credit rating. FTC's website on credit.