My USDA Guaranteed Timeline

[Boldilocks]

Hi all - not a very interesting post - I'm just using this as a means to document the application (and hopefully approval!) journey through USDA... in a place where I won't lose it, LOL.

STATS

Location: Upstate NY

Income: $74,000

Loan: USDA Guaranteed

Purcase Price: $124,000

June 30th

Driving around desired neighbourhood and saw the house, for sale by owner.  Knocked the door, and made appt to view.

July 2nd

Viewed house.  I liked it a lot - DH loved it.  He hasn't loved a house in the 4+ years we have been looking...

July 11th

Viewed house again with a contractor friend as a sort of pre-home inspection.  Being careful as there are no realtors involved.

Made offer!  Sat down with homeowners and agreed on $125,000 (was listed for $129,900).

July 15th

Met with our lawyer to draw up offer contract.

Sent updated pay stubs, statements, etc. to bank - we had preapproved in April 2013 and they needed to run it all again.

July 17th

Picked up offer contract from lawyer, signed it, and dropped it off with sellers.

July 19th

Got signed offer back from sellers and sent it to LO.

July 25th

Home inspection, everything fine with a few minor things.

July 27th

Received mortgage packet.  Signed our name a million times and sent it back - rate locked in at 4.625%.

July 31st

LO submitted application (to underwriting?)

Aug 1st

Got home inspection report and radon report back, everything OK.

Only issue was some non-grounded and non-GFCI outlets upstairs.  Seller offered to give us $1000 cheque at closing instead of changing contract at this point - bringing sale price to $124,000 instead.

Aug 6th

Appraisal - LO says we should have the report in about 2 days...

Aug 14th

Appraisal back - a little lower then hoped for (we wanted $132,500 to include closing costs, and it appraised for $126,500). 

Aug 16th

Lawyer sent me amended contract with purcahse price of $126,500 with $2,500 towards closing costs (seller to net $124,000).

Aug 17th

Sellers signed new contract - took it over to lawyer, but there was no mailbox and it's a Saturday so no one was there, LOL.

Aug 18th

Emailed signed contract to lawyer and loan officer - it's a Sunday, but should hopefully hear something tomorrow.

Aug 22nd

Received commitment letter from lender with several conditions:

1.  Copy of cancelled earnest money check.
2.  Sign Amendment to Purchase Offer reflecting new purchase price.
3.  Sign new Disclosure.
4.  Year-to-Date Profit and Loss statement for Eileen Casey Creations.
5.  Borrowers are to provide evidence 2 Amazon, 2 Chase, QVC and AMEX credit cards are paid off and closed.
6.  Borrowers to provide source of funds used to pay off these accounts.

Aug 27th

All documentation to meet conditions sent.

Aug 28th

Received Addendum to Sales Contract from lawyer.

Sellers signed addendum

Emailed addendum to LO (but after business hours)

Aug 30th

Problem!  Due to taxes coming due Sept 1st, we need to show $6600 in our savings account and there is only $3500 in there now.

Parents have told us they'll lend us the money!  So grateful!

Now, how to handle all the necessary documentation involved in an international money transfer involving pounds and dollars...

Sept 2nd

Parents transferred the funds from their bank direct to mine - could take up to 5 business days to go through.

Sept 4th

Money left parents' account.

Sept 5th

Dad faxed copy of statement, transfer receipt ad gift letter to LO.  Funds have not reached our bank yet.

Sept 9th

ANOTHER setback!  Dad got a call from his bank saying the transfer had been denied and the funds were being returned to his account.

Turns out that our bank is not equipped to receive international transfers.  Now we have to wait for it to come back to dad, then he will wire it.

Sept 11th

Happy birthday to me! 

The money came back to dad's account.  He wired it to me, I picked it up and had it in my bank within the hour.

Emailed my bank statement, dad's statement, and sending and receiving docs to LO. 

Could this finally be it?  Can we get sent to USDA now???

Sept 12th

FILE SENT TO USDA!!!

Sept 13th

Interest rate extended for 2 weeks at cost of $625.

Sept 20th

Clear to Close!!

[justrock]

Everyone's journey is interesting.  I am also in NY and hoping to go USDA next spring (if not NACA).    Yours is especially interesting since you are not using realtors on either end.  Good luck.  Please update when you get your appraisal.

[Lemontwist4]

We are in the same spot lol. I got the approval from the banks underwriters with two conditions (employment verification and a sign formed for USDA) we are still waiting for the employment verification and the appraisal report (it's already been done). The LO says we shouldn't worry that everything looks great and is moving quickly because I sent them way more documentation then they needed so when someone needs something they already have it. The close date that we have in our offer is September 12th but it all depends on when everyone gets everything back to them. She did say we shouldn't worry about USDA underwriting because we already made it through the bank underwriters. So I hope she's right. I can't wait to read your updates!!!

[Lemontwist4]

I know you didn't ask for it but here is my background story.

Hi everyone,

So here is my short but sweet story so far it is still in process 

My husband and I got sick of paying higher than a mortgage payment rent and finally had enough when our rent was raised again (they owners refuse to fix anything so we pay out of pocket for all repairs but yet they raise the rent each year). This time we decided to just see if we could buy a home and in one day I got 4 pre-approvals!! So that was super exciting! So I got online and started looking at houses ect.... Than I started researching what do underwriters look for. I found we had two old medical bills (our oldest daughter after she moved out used out medical insurance and had the bills in my husbands name sent to her house so we had no ideal they were on there) so we paid them off then started researching if we should go FHA or USDA. So we decided to go FHA found a home we had three showings of this home their selling agent was "friends" with our agent so we were going in on Monday to submit a offer the sellers agent said that was fine. Well come Monday morning we get a call from our agent saying she received a late night email Sunday night saying the sellers accepted a offer and she didn't even bother to tell the sellers there was another offer coming in. So needless to say the house hunt was back on. I finally found one that was eligible for USDA. This is where we are today. We made our offer it was finally accepted, we got our inspection, the few items found wrong are currently being fixed by the owners, our appraisal was done we are waiting for the report, the loan went through the banks underwriting with just two conditions ( employment verification and a signed form for USDA) the form was signed right away we are waiting on receipt of the verification and appraisal (nothing I can do but wait) The home insurance agent has already sent all the info to the LO. So when the other two items come in our LO will get final approval from the bank underwriters and it goes to USDA. The LO keeps telling us we have nothing to worry about she sees no issues at all and has no concerns. Our close date is September 12 but I would be surprised if that happened. Has anyone on here made it through the bank underwriters then get denied by USDA? 

[Boldilocks]

Thanks justrock!  I think the same - I have been scouring people's journeys to home ownership for years now through here, you always learn something.

I have had so much help through the credit rebuilding process - I couldn't have done it without this forum - so I want to contribute anything that can help or give reassurance to another in th same boat.

The for sale by owner thing was definitely nerve-racking!  And I felt really, really bad about "cutting" our realtor out of the deal.  But the facts were that we found the house ourselves, set up the viewing ourselves, and I did the list of comps myself.  Our realtor blew off looking at for sale by owners before and I hadn't realised up until that point that she knew it was because she wouldn't get her fee.  We also knew that the seller was adamant they didn't want to pay realtor fees, so we'd end up having to do it ourselves and couldn't afford it.  So we got her a big $70 bottle of designer vodka, LOL. 

It's a small community we live in - we were looking in a group of three villages that border each other and have populations of less than 10,000.  But it was the village that we spied the house in that we *really* wanted to go to.  Most of my friends live there, and they have a municipal power plant - they generate their own power and sell the surplus back to national grid.  The residents get a great deal on electricity and there is no astronomical delivery fee involved - the monthly bill for the house in July with the AC on all month was $40!

So having no realtor was mitigated by knowing the area really well.  We've been looking for 4+ years on and off, and I know the area like the back of my hand.  You could probably point to any house in that village and I could tell you the beds, baths and what it sold for, LOL. 

Plus, and it's a big plus, there wasn't much in the way of conditions and contingencies.  The price he was asking was a fair one (a little high for the vilage but it's the best street in the village and a very desirable area.  Houses on this street only come up every couple of years and there aren't a lot of comps as most haven't been sold in the last 15 to 20 years).  The house is in good condition and we've developed a good relationship with the sellers.  The seller told us when we viewed that the above ground pool would need a new filtration system - we told him we didn't want the pool so he said that he would save himself the money and not get the filtration system fixed.  Fine by us.  And now he has found some buyers for us for the pool once we move in.  Also, he said that they plan to be out mid-August - so once we get the clear to close or have an assurance from the bank that everything is fine, we can move in before the closing date of Sept 15th so that we don't have to pay rent for that month of Sept.

The seller is getting the price he wants (we didn't drive a hard bargain) and we're getting the house we want - and there isn't a lot of cloak-and-dagger stuff or trying to get an edge on the other party.

[Boldilocks]

Lemontwist - similar deal for us.

We had *terrible* floods in this area a month ago.  Our landlord called us the day after and left a message saying if there was water in the basement, "just let it go".  No offer to help or pump or anything.  By this point the water was 4ft high in the basement and was about a quarter of an inch from the electrical panels.  DH was bailing out the water by hand until we finally located a pump in a store (sold out everywhere - thousands of people were affected).  We bought it ourselves and he went down in the filthy water to try to salvage the landlord's basement.  We didn't have a single possession stored down there - it was all her stuff.  I was no use as I'd just had major surgery and wasn't allowed to lift or get the dirty water near my incisions.

She told us there was no need to pump, she'd been in touch with the fire departmebnt and they were coming to do it for us as it was an electrical fire risk.  DH didn't believe her - called the fire department and they said we were on the list... and it would take about 72 hours to get to us.  We have a 6 year old and 5 year old in the house - it was so irresponsible of her to lie to us like that.  Meantime the flood water was still rising.  Well, it did hit the breaker boxes.  We lost power for about a week and hot water for about 10 days.  We had to buy the pump ourselves and a generator for basic power.  DH did all the pumping himself.  We told her, "sorry, you're not getting rent for July - it doesn't even cover the pump, generator and all the work DH put in".  We have never missed a rent payment or been late in over 4 years.

So what did she do then?  She called the police on us, of course!  That was the last straw.  The officer was embarrassed to be therre - we are professional people not deadbeat serial rent non-payers.  We are done with renting and crazy landlords.  We NEED to get this house.  And once we do, I'm calling the village inspectors because the wiring, plumbing and insulation aren't up to code, as well as a multitude of other things.  She has never done any maintenance since we have been there - just fixed the odd emergency with a lot of persuasion.  I've replaced a toilet and bathroom floor at my own expense, replaced the stove and fridge when they died because she wouldn't, put up "double glazing" (custom sized plexi-glass panels) to help insulate - but it's so bad that our heating bill is still about $700 a month in the winter.

AHHHHH - it felt GOOD to get that out!

Anyway - I'm a nervous wreck at this point.  Worried the house won;t appraise for the amount we offered.  Worried that something will come up in underwriting that wasn't seen before, worried that they'll ask our landlord about rent payments and she'll try to scupper it for us.  What was the employment verification that you had to send?  Weren't paystubs proof enough?  Also the USDA form - what was that??

I'm tempted to call the seller and see if the appraisal has been set up yet, but I have a terrible phone phobia, LOL. 

[Lemontwist4]

I gave them 3 years of w2's and tax returns and 4 months of paystubs my husband has been continuously employed at the same employer 16 years but they still wanted verification which is basically just the bank sending a form to his employer to double check his info I guess certain banks just have the normal no big deal things they double check and this is theirs. The form is just the request for single family housing loan guarantee the form in the  packet he signed was approved lender certification.

I hope you get your house too having to deal with dead beat landlords stink we live in a complex with about 60 apartments the buildings have enclosed hallways and the landlords pay to heat them well they got into a fight with the gas company and even thought we all paid our bills the gas owners wouldn't pay their bill so the gas company pulled up all our gas meters we were without gas for weeks. So I understand when the neighbor called about a repair that needed done the owner told her to go F$%# herself. So yea we need out really bad too. Right now all we can do is wait there is nothing left for us to do. However I have read a lot of USDA forums and most all of them say they get USDA approval a day or two before close so try to relax and what happens happens we should do all we can and if it's not good enough we try again but we will both make it and be home owners I know it's not so easy to wait and hear nothing but remember we are here with you all of us waiting together.

[Boldilocks]

Appraisal is taking place right now - I might just pass out.  Breathe in, breathe out, in, out...

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Lemontwist - so far they've had both our driving licenses, 2 years w-2s, 2 years tax returns, 4 months pay stubs and my 2011, 2012 and 2013 YTD profit and loss statements (I'm self-employed, but make peanuts).  DH is the main earner - he's a state worker and has been there 17 years.  Hope they don't ask for more... or if they do, do it now so I can get cracking on it!

I hope they don't contact the landlord!!  We gave her the rent for Aug last week, but she's still fuming that we didn't give her July.

[Genkeim]

USDA approval is the last major step before closing. As long as whoever you're getting the mortgage though knows what they're doing USDA approval is pretty much just a formality. USDA is due to look at our file on the 20th and we have closing set for 2pm on the 23rd. LO says they need 48hrs to prepare closing paperwork.

Keeping fingers crossed!!!

[Lemontwist4]

Boldilocks I know just how you feel our appraisal was done last Thursday and us and the LO are still waiting for the appraiser to complete the report and get it to the processor at the bank it's driving me nuts!!!!