08-14-2011 07:52 PM
For weeks I've been searching the internet trying to find some indication of whether my husband will be approved for a home loan but I can't find anything that comes close to our situation, so I thought I would just ask & see if anybody can give some insight on what I can expect when I follow up on our mortgage app this week. The wait is killing me & I have a dreadful feeling he is not going to be approved, so I guess I'm just trying to prepare myself. What do you guys think the odds are of an approval or denial based on our history?:
I am a stay at home mom. I worked for 6 years at an insurance company but resigned over a year ago to stay home with our 1st child so I will not be on the loan.
My husband's middle score is 655.
He works in the oil and gas industry. He started in this industry in feb of 2010 (not making much money) & moved to his current company in the beginning of may of 2010 so he has been in this field 18-19 months & at his current position 15-16 months. We are applying for FHA & the 2 year work history thing has me worried. My husband has always worked, I just don't know if they will solely focus on the last 2 years & that lapse of employment. He began college in Sept of 2006 & also started a job at that time. He worked at that job until March of 2009 (sometimes part time, sometimes full time, depending on what he could work around his full time school schedule). In Feb of 2009 he started with another company, so he was working 2 jobs & going to school. He resigned from the 1st job in March b/c they were running out of hours for him, worked well over 40hrs a week at the second job, graduated in May of 2009 & then resigned from that job to take a low paying job in the field he graduated in. He worked in that field until Nov of 2009 (masonry, so it's seasonal), was told to file for unemployment but the owner would likely have indoor work & would be calling him in a week or 2. When he didn't call, my husband immediately began looking for work but with the economy how it is, it took him until the beginning of feb. He took a position planning on returning to his masonry position however learned about the money to be made in the oil & gas field & ended up staying in that field & not returning to masonry. So he has worked steady from sept 2006 (even before that) until nov 2010, then a lapse from nov-feb, then steady from feb 2010 until now. So that's my # 1 concern.
The # 2 concern is his income. My husband works a weird schedule & gets weird bonuses & overtime. He works roughly 90 hour weeks 2 weeks at a time, then has 2 weeks off. So obviously 48-50 hours on his paycheck are overtime hours but since he hasn't been there 2 years, FHA will not count his overtime pay which basically seems like he makes nothing. Now the loan officer did say since his employer will document that he HAS to work 90 hours a week, that they can count his overtime hours, but not the over time pay (which makes no sense to me since you can't work overtime & not get paid an overtime wage, but whatever, as long as they count it as something I'm happy). He also gets bonuses, hazard pay & a per diem pay of $500 that is a tax deduction so while it puts more money in our pockets, it doesn't add to his gross income. His gross pay on his last 2 paychecks which included his overtime, safety meeting pay & hazard pay (2 weeks of work) totaled $5400. Not factored in is his per diem allowance of $1000 for the two weeks. & 3 bonuses for the month of $698 total. I know it's a lot to take in & is confusing, but basically all that matters is the loan officer put our monthly income at $3813.00 which is a good deal less than actual, but I'm wondering if this will be enough to qualify for the loan or if they might even count some of the other things?
#3 problem...credit collections. They are from 2005 & 2006 which shouldn't normally count, but my husband couldn't remember what the 2005 ones were so we disputed them a few months ago & now they are showing as fresh. They are about $150 & $180 each. & there are 2 of them for the same visit rather than just one. The other one from 2006 was $654, we made one payment of $50 back in 06 which took it down to $604 then in 2010 they sold it to another company, so now it is showing on the credit report twice (one for $654 & the other for $604) & the newer one doesn't show it's medical
total monthly payments listed as $824
We pay $700 in rent now
loan amount $85671.00
cash needed to close: $3600
$4600 in savings
Any thoughts from the experts? Any insight will be appreciated, this is all new to us!
Hi I know how stressful this is. So anyway, what do you mean they are "showing as fresh?" What does the credit report list the DATE OF DELINQUENCY or DATE REPORTED as? Even if they updated it for July or even August of 2011, that doesn't make it "fresh" -- the score is impacted when it first goes to collections and even if the Collection Agency keeps updating a balance due (is it paid) or a zero balance (?) it won't change the fact that it was first reported back 06.
Regarding his wages and hours - I have no idea.
08-15-2011 02:27 PM
I don't have any insight into your situation except to say that we're just about to refi (though it hasn't actually happened yet) with a middle FICO score the same as your husband's. It's not great, and we're not getting the greatest interest rate; but we were thrilled to find mortgage companies willing to lend us money.
08-15-2011 04:24 PM
That's the thing, they have the "new" collection with a 2010 date, nothing about the original date & it doesn't say that it was medical either. I'm scared to question it from the horror stories I read online with people saying underwriters were denying them b/c they didn't question a collection until they were apply for a home loan. On a happier note, I spoke with somebody today that isn't my loan officer (she's on vacation), she's the admin asst, but she said we were approved, they just needed a copy of our retirement statement, ss card & drivers license, all of which we already provided. So while I'm happy she said that, I don't really trust it & don't feel out of the woods yet, plus she was using a new computer system & was having a hard time. I guess only time will tell. Thanks for your response though!
08-15-2011 04:26 PM
It's good to hear they are lending to you. We went through FHA so we locked in the rate of 4.25%, no complaints here, just want to get moving so we can get that rate for sure. Thanks for the response!
08-15-2011 04:38 PM
Did she say you were approved because you made it through automated underwriting?
I know how you feel. I won't trust anything until the loan is FUNDED.
08-16-2011 02:24 PM
Cpngrats on your approval hope it goes well.
As far as the questions for those following along
#1 If he is a field related to his schooling he can count the schooling as work history - since he has a solid 15-16 months and the schooling it shouldnt be an issue
#2 you are correct they cannot count the overtime but they can count the hours at his reghular pay scale -I know makes no sense - it is what it is
#3 Be prepared to pay the collections if they come up (underwriter asks) - If the accts are in dispute always better to remove the disputes prior to applying - for conventional a dispute will cause a denial for FHA it kicks it down to a manual underwrite and you will not be able to use the higher ratios often allowed with an automated undewrwrite
Let us know how it goes