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Underwriting/credit question

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ajzjmsmom
Established Member

Underwriting/credit question

I had posted on here that we paid off all of our debt at the first of the year, we had recently retired and accessed our 401K to pay off the debt and put money aside for the home purchase.   On Feb 14th, we applied for a mortgage with a local lender in TN, we were already pre-approved with another lender but were wanting to close a little sooner than 30 days and most of the realtors in the area we are moving to work with this local lender.  Anyway we put in an offer on a house on Weds and then on the 14th spoke to the local lender.  He ran our credit,  filled out the application and we were approved, his loan processor sent us an email yesterday just asking for an explanation about  a large deposit into the savings account in January that we are using to fund the mortgage and said that was her only question about the file.  The file is getting ready to go to underwriting and I am wondering if the fact that we paid off a large amount of debt in early Jan and the fact that we have quite a few open accounts will be held against us in underwriting?  

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ezdriver
Senior Contributor

Re: Underwriting/credit question

Open account in good standing and not pushing your DTI over the limit will not be held against you ... generally speaking. There is another post on this forum where a lender demanded that the borrower close some relvolving accounts ... but that seems to be an anomoly. Uderwriters see paying off/down debt as a good thing. Request for documentation of significant deposits is normal. Nothing to worry about.

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