Rental verification USDA

[jwpezd]

I am putting in an offer with a USDA loan tomorrow. The lender is a little skeptical due to a couple of things.... One my rental history. We have only been in our current condo for only six months. Before that we moved in with my wife's parents to help them get some relief and pay there mortgage. Before that I was renting a home that we had planned on living I. For awhile however the homeowners were going in to foreclosure and essentially lost the home when we were renting it. Before that we rented an apartment for a full twelve months. I couldn't help any if these situations and had no clue this would turn down the loan.

Second my employment. I had been with the same employer for over five years. I was in retail sales management. In August I got a great opportunity with a sales job with a big bank that I couldn't pass up. I took literally one day off. Again I was told this may kick the loan out.

I am really frustrated with this. My wife's and my scores are both well over 640. I just don't understand the issue.

My loan officer said he gives a 25% chance that USDA will approve. He said his office and underwriters will approve the loan no problem it's just USDA.

Any ideas or help would be great. I want to put in an offer tommorow but if its not going to close then I will not wast my time or the sellers.

[sharpie]

They only need to look at your rental history and all the other stuff he is worried about if your credit score is below the 640 mark.  This is what the guy at USDA told me.  I think if I was you I might be calling around to speak with a few more LO.  Just my .02.

[jwpezd]

Yeah that's what I had thought. But what about the employment change?

[sharpie]

I am not sure on the employment, but is is somewhat the same field?  Maybe get the loan through the bank you work at.  It seems they might understand why you switched?  Not sure on that one.

[JM-AM]

Your assumption based on a score is not true.
Everything is looked upon for verification.

Employment if is still a sales position which usually all bank employess are required to push there products to sell. It may not be an issue. But if you took an executive position out of sales it may. The bright side if you are making more money because of the employment change it usually is a mute point and not to really worrry about.

Another option is to seek another LO or Broker as mentioned, or you can change the type of loan to something that will accomadate your situation.

[Anonymous]

I have a similar situation, my score was at a 638 and lender said i can still get through underwriting but would need rent verification, however now my score up to 641 and still asking for rental verification,Im suppose to close in 25days and my file has not even been sent to usda yet.

[JM-AM]

Rental verification can be used for a few reasons. It can be because you have a limited amount of tradelines, it can be used to offset your new loan amount so payment shock is not a concern as a few examples.

If you are asked for them, the faster they receive them the faster your file goes into USDA que.

[jwpezd]

Jm-am, we have been renting a condo for seven months at 900 per month. Before that I lived with my inlaws to help them financially and so I could pay down cc and get selections on collections. My new payment will be 1230 per month. I have not been asked for verification. However, if I am do you think this could be an issue ?

[playboy]

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@jwpezd wrote:
Jm-am, we have been renting a condo for seven months at 900 per month. Before that I lived with my inlaws to help them financially and so I could pay down cc and get selections on collections. My new payment will be 1230 per month. I have not been asked for verification. However, if I am do you think this could be an issue ?

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I  guess that it may depend on the type of loan you're getting.  I have a USDA loan and there is a "payment shock" thing that the USDA uses in determining if they should the loan.  With USDA payment shock comes into play when your principle, interest, taxes and insurance is more than 100% of what you're currently paying for rent.  At first I thought it strange that my lender verified my rent with my apartment complex.  But after reading up on USDA's payment shock thing I understood.  The payment comparison appeared on the first page of my GFE and it listed the % difference.

[JM-AM]

Just be honest and give what you have.

Sometimes questions will arise but then you address then.