I'm helping my sister and her husband prepare for a VA refi, not an IRRRL. LTV will be 80-85% DTI should be good (haven't run the numbers, but they should be fine based on what I've seen) They are new members at NFCU and will be looking to refi with them. Current info:
Him: 577 Ex 630 TU 565 Eq
He has lates on his Cap 1 (30 day 6/16, 30 9/16, 60 10/16) and Kohl's/Cap1 (30 10/16) Last lates prior to this were 2014. Working on GW with Cap1
Utilization: $3224/3300, $857/1100, $0/300 Since the report with above scores was pulled, he has paid off the $857 and will have the $3224 down to less than 9% in July/August.
Her: 595 TU 608 Ex 581 Eq
Recent unpaid medical collection reported 10/16 and updated monthly. They have accepted a PFD and this will be removed soon.
Cap 1 late 10/16-requesting GW to remove
Also, AU on the card with the $857 balance that has been paid off.
Opened a new Amex that should report a $0 balance prior to application
If they can't get the Cap 1 lates removed, should they wait until the 12 month mark in October or do you think they'll be ok to apply once their utilization is down to less than 9% on the last card?
@VALoanMaster wrote:
@medicgrrl wrote:I'm helping my sister and her husband prepare for a VA refi, not an IRRRL. LTV will be 80-85% DTI should be good (haven't run the numbers, but they should be fine based on what I've seen) They are new members at NFCU and will be looking to refi with them. Current info:
Him: 577 Ex 630 TU 565 Eq
He has lates on his Cap 1 (30 day 6/16, 30 9/16, 60 10/16) and Kohl's/Cap1 (30 10/16) Last lates prior to this were 2014. Working on GW with Cap1
Utilization: $3224/3300, $857/1100, $0/300 Since the report with above scores was pulled, he has paid off the $857 and will have the $3224 down to less than 9% in July/August.
Her: 595 TU 608 Ex 581 Eq
Recent unpaid medical collection reported 10/16 and updated monthly. They have accepted a PFD and this will be removed soon.
Cap 1 late 10/16-requesting GW to remove
Also, AU on the card with the $857 balance that has been paid off.
Opened a new Amex that should report a $0 balance prior to application
If they can't get the Cap 1 lates removed, should they wait until the 12 month mark in October or do you think they'll be ok to apply once their utilization is down to less than 9% on the last card?
Hi Medicgrrl,
Unfortunately I'm pretty sure NFCU won't do this loan. They require a 620 or better mid score and I don't think they'll do a manual underwrite. If you can get most of the "recent" derogatory hits cleaned up & the scores go up, you should have a pretty good chance of getting an approval through an AUS. If you cannot get the recent lates deleted you're probably going to have to wait until the last late payment is 12 months old.
If you do not get an approval through an AUS, an underwriter will have to use the more restrictive manual guidelines. If you can get an automated approval, the underwriter can ignore the derogatory credit hits. The main concern is the fact that we don't just have 1 or 2 hits, we have multiple lates plus a 60 day late & the medical collection.
Here's an example: I have client that stared out with a 607 score. We got him up to a 640 but still couldn't get an approval through an AUS because the credit still shows a couple of accounts that report as derogatory so we're stuck doing a manual underwrite.
In my past life I was an UW, but it's been awhile so I wasn't sure of current guidelines. So what we have so far is the CA agreeing to PFD. That will be paid off this week. I've got 2 out of 3 of their credit cards paid off and am working on their third with them. Goal is to be less than 9% on one card by July. I know when my son's utilization went from similar starting % to about 17%, he gained 39 points on Ex. I'm hoping mortgage scores are just as generous and my brother in laws scores will go up by about 45 due to the lower utilization than my son. That should bring them both to a mid score of 620. If you think they should wait until October, they will do it. They currently have a subprime ARM and it's not going to adjust before then. We're just trying to get this done before rates make any moves this year. All advise and guidance is greatly appreciated!!