Underwriting question

[canusa11]

So my husband and I are going to start house shopping soon. My AAOA was pretty low like 2 years. Back in 1994 I was an AU on my husbands Amex account. I oend to new accounts last month. Both backdated to 1994 & are both reporting opend 1994. My AAOA shut up to almost 5 years. Also my credit score went up from 685 to 715, Equfax this site. So if its a Manual review the underwriter will see new acounts right?What if its not a Manual review? Will the computer pick up on it? Also what credit score triggers a Manual? My loan office said under 650, is this correct?

[ezdriver]

There is no specific score that causes a manual underwrite but a 640 score is required for automatice underwriting. Also, the score itself is only one factor that can require a manual underwrite. For example, my own file is being manually underwritten ... not because of my scores but because of the FHA program that I'm using to qualify for a loan. Lender set their own underwriting policies so its all over the place.

[ShanetheMortgageMan]

To be approved via automated underwriting FHA requires a 500 score, VA doesn't have a minimum score, USDA doesn't have a minimum score, and conventional (Fannie/Freddie) require a 620 score.  That doesn't mean that with that score you will automatically be approved through automated underwriting, it just means that if you don't meet those scores then you have zero chance of being approved through automated underwriting.

Your credit report is always reviewed with a human pair of eyes.  Everything in your file is always reviewed with a human pair of eyes.  A backdated account looks just like that, that it was opened in 1994.  There is a separate portion of a tradeline called "months reviewed", which is the number of months that activity has reported for.  For example I had a client who had several installment accounts with a local department store that were open for 2 years each, but they only reported the trade line the very last month of the loan so there was just 1 month reviewed but it said it was opened 2 years prior to it being paid off.  To prove to the underwriter that there was indeed a full 2 years of activity we needed to get the payment history from the creditor.

[ezdriver]

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@ShanetheMortgageMan wrote:

To be approved via automated underwriting FHA requires a 500 score, VA doesn't have a minimum score, USDA doesn't have a minimum score, and conventional (Fannie/Freddie) require a 620 score.  That doesn't mean that with that score you will automatically be approved through automated underwriting, it just means that if you don't meet those scores then you have zero chance of being approved through automated underwriting.

Your credit report is always reviewed with a human pair of eyes.  Everything in your file is always reviewed with a human pair of eyes.  A backdated account looks just like that, that it was opened in 1994.  There is a separate portion of a tradeline called "months reviewed", which is the number of months that activity has reported for.  For example I had a client who had several installment accounts with a local department store that were open for 2 years each, but they only reported the trade line the very last month of the loan so there was just 1 month reviewed but it said it was opened 2 years prior to it being paid off.  To prove to the underwriter that there was indeed a full 2 years of activity we needed to get the payment history from the creditor.

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Is that your company's requirement? I ask because several of the lenders [mostly national companies] in my area tell me that they need 640 for automated underwriting.

[ShanetheMortgageMan]

That's FHA's requirement.  We can go down to a 600 and even down to a 500 in some situations.  However the chances of a 500 credit score getting an automated underwriting approval is pretty slim unless there are some major compensating factors (such as a large down payment, low debt ratio, and/or a lot of reserves).