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Established Member
Posts: 26
Registered: ‎09-22-2010
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I have 2 late payments this year Can i still purchase a New home???

i credit scores are around 650... but i was 120 days Late on a Credit Card that went into collections on January 2010, But i heard you couldn't have any lates in 12 months to get a Home Loan, If i applied next month for a Loan will they automatically Disqualify me or will some Lenders over look it??? its an FHA loan

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Posts: 86
Registered: ‎06-14-2010
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Re: I have 2 late payments this year Can i still purchase a New home???

I just went thru pre-approval for an FHA 203k at WF.  I was told by my LO that they go back two years looking for slow pay or lates.  Anything beyond that may require a LOE, but will not derail the process.  For my pre-approval, i was approved via automatic underwriting with lates on my CRA.  But the lates were >4 years old (most are around 5).  So far they have not asked for any LOE but we are not very far into the process (yet).


Starting Score: 3/2010 - TU = 635 EQ = 620
Current Score: 10/2010 - TU = 699 EQ = 743 EX = 709 (LO pull)
Goal Score: 1,000,000


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Regular Contributor
Posts: 187
Registered: ‎01-25-2010
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Re: I have 2 late payments this year Can i still purchase a New home???

Can you expand upon your WF experience?  I thought that for FHA they were looking for 12 months clean?   I have a few about 17-18 months ago (just 30's) but would that derail any application?  I also have a lot more older than 2 years in cluding a couple paid CO's in 06.  

Senior Contributor
Posts: 3,299
Registered: ‎04-22-2008
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Re: I have 2 late payments this year Can i still purchase a New home???

While some lenders may be able to overlook a single 30 day late in the last year, a 120 day late is probably a deal breaker from any underwriter.  At least, you are likely to have to wait until it has aged out to a year, but it is quite possible that they are going to balk until it is 2 years old.  Understand that there are LO's out there that will still say they think they can get it done, but I would not spend a dime or a hour of my time unless they could get a full pre-approval through their underwriter...  It is just too high of a risk the LO would push the loan and the UW will deny.

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Posts: 3,299
Registered: ‎04-22-2008
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Re: I have 2 late payments this year Can i still purchase a New home???

If you have that much of a history of lates I am positive the 120 day late will be a deal breaker.  The only way they can overloo something like that is if there is credible belief that it was an error or unavoidable type situation.  With the history of lates you have provided, there is little chance an UW is going to OK a loan right now.

 

As far as 12 months verse 24 months, here is how it goes...  There is no golden ticket.  Some people will get approved with a recent late provided they have otherwise clean history and a reasonable explanation.  They look at all the lates on your file.  They weigh the ones in the last 12 months the most, but they very closely scrutinize any lates in the past 24 months.  With a history of late payments, it is quite possible for an underwriter to want to see longer than 12 months clean history to show that whatever problems or habits led to the older lates have been taken care of.  12 months is easy enough to force yourself to be good and stay on track, but most peopl with bad habits will not last much more than a year without them showing up at some point. 

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Posts: 265
Registered: ‎07-24-2009
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Re: I have 2 late payments this year Can i still purchase a New home???

[ Edited ]

 


siccrydas wrote:

i credit scores are around 650... but i was 120 days Late on a Credit Card that went into collections on January 2010, But i heard you couldn't have any lates in 12 months to get a Home Loan, If i applied next month for a Loan will they automatically Disqualify me or will some Lenders over look it??? its an FHA loan


Are you saying that this was charged off in January? I can't imagine anyone would be able to qualify for a mortgage with a charged off account within the last two years. Have you paid this yet? Even if they would let you slide through somehow, they would most likely require that it is paid since it is so new and theoretically they could get a judgment against you and put a lien on your house. Lenders don't like it when their collateral is evenly remotely threatened

Super Contributor
Posts: 6,697
Registered: ‎07-03-2007
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Re: I have 2 late payments this year Can i still purchase a New home???

underwriter discretion.... but willingness and capacity to pay are important.

kind of hard to convince an underwriter that you are willing to pay if you let a card go so recently..... unless there are extenuating circumstances.

 

 

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Established Member
Posts: 26
Registered: ‎09-22-2010
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Re: I have 2 late payments this year Can i still purchase a New home???

Yea I paid it off in January 2010... I plan on waiting til January 2011 to apply for a home loan... I'm just hoping the lender approves me. It's the only thing I'm stressing about.
Frequent Contributor
Posts: 265
Registered: ‎07-24-2009
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Re: I have 2 late payments this year Can i still purchase a New home???

 


siccrydas wrote:
Yea I paid it off in January 2010... I plan on waiting til January 2011 to apply for a home loan... I'm just hoping the lender approves me. It's the only thing I'm stressing about.

Did you pay the OC or a CA? You could try to get them to delete this from your report. Since it is paid, it may not be as much of an issue anyways. Good luck! January will be here before you know it. Smiley Wink

 

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Established Member
Posts: 26
Registered: ‎09-22-2010
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Re: I have 2 late payments this year Can i still purchase a New home???

I paid the oc but tried getting it deleted . Last 5 months I was on a credit repair mission. All my scores r around 650 now. I don't mind waiting til January cuz its income tax season! More money for furniture haha
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