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Established Member
halle101
Posts: 39
Registered: ‎04-22-2011
0

Trying to get pre-approved

[ Edited ]

HI, reading your mortgage process, would seem like we should be able to get a pre-approval right now... But that's not the case with my family...

 

We have spoken with 3 mortgage lenders, and they all give us the same story... "We see that you make more than enough, but your mid score needs to be at least 630, Mine is at that mark, but my spouse isn't just yet. However, now that my score is at the midmark, they state that I have other issues, which were late payments that occurred in the past (7 months ago) they stated that, well one stated that the late payments has to be a year old.

 

The other, basically stated that I need to pay off all my revolving credit, due to debt to income ratio, if I was to try and get a home loan on my own.

 

Really don't know what to do now, except just wait for both of our score go up and see what happens.

Moderator Emeritus
llecs
Posts: 32,881
Registered: ‎08-04-2007
0

Re: Trying to get pre-approved

OP, I split your post to form a new one here. I had to edit the title, but changed nothing else. If you'd like to change the title, click "Options" and then "Edit Message".

 

Lenders generally have the same guidelines, but each can have their own differences. I responded to your post in Rebuilding, I believe, but if utilization is an issue, you may want to focus on your DH's credit. You'll find that his score will rise fairly quickly and the DTI would be less of an issue, if at all. Per the late, GW it and if approved, the three things you just mentioned wouldn't be an issue the next time you approach a lender.

Super Contributor
ShanetheMortgageMan
Posts: 8,252
Registered: ‎09-28-2007
0

Re: Trying to get pre-approved

Having a clean credit history for 12 months is pretty much a requirement for any loan program.  There are some exceptions, such as an isolated late payment, or a medical collection... but usually someone with ~630 scores has more than just one late payment in the last 12 months (either that or maxed out credit cards), so if there has been negatives in the past, and then another late payment in the recent 12 months, to an underwriter it appears the credit issues haven't totally subsided.


In the past 12 months, was there just the 1 late payment 7 months ago, or are there other delinquencies that have occured?  Going back beyond 12 months ago, are there any delinquencies?  Do you owe collections, charge-offs, judgments or tax liens?

 

What is the price of the home you are looking to buy?  How much is your income?  How much are your monthly minimum consumer debt payments (cc's, car, student loans, etc.)?

Member
kimfl
Posts: 18
Registered: ‎08-07-2012
0

Re: Trying to get pre-approved

Does having a judgment automatically preclude you from getting a mortgage? I spoke to one broker, and she told me that no one would approve me, so I have an attorney friend who is going to try to work things out on this. All my bad debts are years old, at least 4 and most 5-6 years old. My credit scores are 584 from Equifax, 621 from TU, and 682 from Experien. The last I pulled myfico score it was 637, but I have had Experien correct an error on my report (it increased 43 points in one month because of this). I feel that right now, the ONLY thing stopping me from getting a mortgage is that judgment. 

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Senior Contributor
StartingOver10
Posts: 4,200
Registered: ‎03-06-2010
0

Re: Trying to get pre-approved


kimfl wrote:

Does having a judgment automatically preclude you from getting a mortgage? I spoke to one broker, and she told me that no one would approve me, so I have an attorney friend who is going to try to work things out on this. All my bad debts are years old, at least 4 and most 5-6 years old. My credit scores are 584 from Equifax, 621 from TU, and 682 from Experien. The last I pulled myfico score it was 637, but I have had Experien correct an error on my report (it increased 43 points in one month because of this). I feel that right now, the ONLY thing stopping me from getting a mortgage is that judgment. 


Yes, a judgment can keep you from getting a loan.

You want to have the judgment either vacated or satisfied before you even apply for a loan. In many jurisdictions if you buy property with an outstanding judgment the judgment can attach to the property and actually come in front of the mortgage. That happens instantly when you close so now you have an encumbered title. That's one of the reasons why lenders' won't loan to someone with an outstanding judgment.

 

So is your friend going to contest the judgment and have it vacated or is he going to negotiate the settlement/satisfaction for you?

Member
kimfl
Posts: 18
Registered: ‎08-07-2012
0

Re: Trying to get pre-approved

She is going to try to negotiate a greatly reduced settlement.


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