Is using the Navchek LOC considered as overdrafts for underwriters? I have used it and kept it a small balance. Mainly because I didn't count it as overdrafting. Will the lender see it that way? I want to apply in a few months and will not use it until I apply. Is this gonna stop me from getting a home loan?
This came up for me as I was working to qualify through NACA. I wrote a letter of explanation stating that I believed this was a normal facility offered by the bank but would stop allowing overdrafts. Basically they considered any covering of overdrafts from Navchek an overdraft. I just deposited Navcheks into my USAA account if I needed to draw funds. Now for NACA you submit bank statements every month, another lender may just look at a lst two or three.
I'd say stop triggering automatic draws now. If you get questioned an LOE should handle it, strengthened by the demonstrated period without covering draws.
This a very good question.