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Member
Posts: 11
Registered: ‎09-26-2009
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Pre-Approved for FHA, >580 FICO, Will we be able to close on time?

We have just had a pre-approval for an FHA through Bank Of America for 5.0% and 5.5% APR (with a half point paid).  Our credit score is between 575 and 594. We are scheduled to close on our new home October 30.  Our Loan Officer originally quoted us a few weeks back that it would be 45 days to close.  Is this accurate, usually?  If they can't get the deal done, where can we find a bank that is just as flexible with credit problems as B of A?

 

Thanks in advance.

 

 

Super Contributor
Posts: 8,362
Registered: ‎09-28-2007
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Re: Pre-Approved for FHA, >580 FICO, Will we be able to close on time?

BofA is quoting an unusually long time through their retail side to do purchase loans, however if there is no lag time between when information is needed by the lender and when information is provided to the lender they can still close within 30 days.

 

Have you supplied all of your documentation to them and has an underwriter reviewed it?  Are you under contract on a home right now?

Member
Posts: 11
Registered: ‎09-26-2009
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Re: Pre-Approved for FHA, >580 FICO, Will we be able to close on time?

Hi Shane,

 

Thanks so much for responding. The residential sales contract was signed by all parties yesterday (we made the offer on Thursday and it was accepted Friday).  I believe it was executed yesterday as well.  Our pre-approval was done two weeks ago, it was an automatic pre-approval (not sure what that means) and we have all the docs (application, W-2s, Tax returns, bank statements) ready to send to the LO, so no, it has not gone to underwriting as of yet.  I think that's why I am so apprehensive.

 

 

 

 

 

Senior Contributor
Posts: 3,299
Registered: ‎04-22-2008
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Re: Pre-Approved for FHA, >580 FICO, Will we be able to close on time?

out of curiosity, do you hqave large reserves and/or down payment.  580 loans are very hard to get noe adays and I am curious about what is getting through on these and what is not.
Super Contributor
Posts: 8,362
Registered: ‎09-28-2007
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Re: Pre-Approved for FHA, >580 FICO, Will we be able to close on time?

With BofA the underwriter never looks at your information until you are under contract, so it's quite natural for you to be apprehensive with that company unless you are absolutely know you are very well qualified - and with your scores I'm sure you might have your doubts.  I'd really press the LO to have the underwriter look at your information ASAP now that you are under contract, I've heard sometimes it can take them a couple weeks, and depending on if the LO is a good one or not, it might be a couple weeks into the contract before you find out the underwriter has issues.  

 

This is why I recommend people only get pre-approvals from lenders where the underwriter will actually review your information before you make an offer, a lot of banks will make the excuse that if they did that for everyone they'd get bogged down, but that is a complete lie as there are tons of lenders who will have an underwriter review your information prior to you being under contract and those banks who do aren't bogged down.  You will usually find flexibility like that when working with a mortgage broker, but there are of direct lending places that will do it as well.

Member
Posts: 11
Registered: ‎09-26-2009
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Re: Pre-Approved for FHA, >580 FICO, Will we be able to close on time?

We do have 20% to put down from the sale of our condominium.  Is that the difference, do you think?  My husband has been a postdoc for 5 years and will be starting his new job October 1 with a salary of $100,000/yr.  We have very little on either of our credit reports; mostly lates from about three years ago, when we were really broke (a postdoc's life is not grand).  However, our mortgage history of 6 years is clean with only one 30-day late from last August due to a mailing error. We have a few collections (less than $1500 total) that I am certain the underwriter will want us to clear up before we make it through.

 

Does that sound okay?  I'm kind of freaking out now.  Ugh.

Valued Member
Posts: 30
Registered: ‎07-31-2009
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Re: Pre-Approved for FHA, >580 FICO, Will we be able to close on time?

I'm going with BofA also. My LO had me extend the closing date to the 45 days but also had me tell them that the process would most likely go much quicker if they really wanted to close sooner it would most likely be probable.
Super Contributor
Posts: 8,362
Registered: ‎09-28-2007
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Re: Pre-Approved for FHA, >580 FICO, Will we be able to close on time?

20% down can certainly make a big difference, perhaps that is why you got the automated approval with imperfect scores, but still recommended you have the underwriter review your loan ASAP, and if you are under contract then BofA can certainly do that at this point.
Member
Posts: 11
Registered: ‎09-26-2009
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Re: Pre-Approved for FHA, >580 FICO, Will we be able to close on time?

Just wanted to update: our loan officer won't even send it to the underwriter to review until we clean up the collections and judgment.  So--we've been working on that all day.  The biggest problem seems to be that we have money and can't find who we need to pay.  For instance, one of the collections is from a company called CBCS, but I have no way to contact them whatsoever.  I've tried just about every google search result with no phone number...if anyone has a number for them, I'd be very appreciative! Smiley Happy

 

So far, we have paid 3 of the 4 collections, and have paid letters on those.

We are working on paying on the judgment right now (hubby's on phone).  Hopefully we can take care of that today.

We do have one duplicate as well that we are trying to get removed but have been told by the collection agency that "they don't do that".

 

Any tips or suggestions would be helpful.  We are hoping to get this done today so we can fax all the letters to our L.O. and hopefully, he'll get us going.  We are scheduled to close on the 30th, and our option period is over tomorrow.

 

*sigh*

Frequent Contributor
Posts: 404
Registered: ‎04-15-2009
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Re: Pre-Approved for FHA, >580 FICO, Will we be able to close on time?


TexasMom wrote:

Just wanted to update: our loan officer won't even send it to the underwriter to review until we clean up the collections and judgment.  So--we've been working on that all day.  The biggest problem seems to be that we have money and can't find who we need to pay.  For instance, one of the collections is from a company called CBCS, but I have no way to contact them whatsoever.  I've tried just about every google search result with no phone number...if anyone has a number for them, I'd be very appreciative! Smiley Happy

 

So far, we have paid 3 of the 4 collections, and have paid letters on those.

We are working on paying on the judgment right now (hubby's on phone).  Hopefully we can take care of that today.

We do have one duplicate as well that we are trying to get removed but have been told by the collection agency that "they don't do that".

 

Any tips or suggestions would be helpful.  We are hoping to get this done today so we can fax all the letters to our L.O. and hopefully, he'll get us going.  We are scheduled to close on the 30th, and our option period is over tomorrow.

 

*sigh*


Shouldnt all contact info be on the credit report?  Address if not phone numbers as well?  I dont know if the CRA can give you more info than what is on your CR?


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