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Contributor
leppy2
Posts: 127
Registered: ‎12-11-2012
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overdraft fees

My husband has some overdraft fees from earlier in the year on his banking statements. Could that cause the underwriter to deny our loan?
Valued Contributor
chasmith
Posts: 1,062
Registered: ‎05-26-2010
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Re: overdraft fees

It could, or more likely, lead to a request for a letter of explanation.

BK7 Filed 8/11/2009 Discharged 11/23/2009. Purchased new home 4/11/2012
Starting Score:11/16/2009 EQ 566 11/16/2009 TU 538
Interim Score: 12/27/2012 EQ 683 09/17/2012 EX (lender) 670 1/01/2013 TU 701
Current Score: 11/06/2013 EQ 708 11/06/2013 EX 702 11/16/2013 702 11/06/2013 TU 729
Goal Score: EQ 740 EX 740 TU 740
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Valued Contributor
Mike_B03
Posts: 1,146
Registered: ‎11-30-2012
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Re: overdraft fees

How many overdraft fees are we talking about? I've read about poeple's loan getting denied do to overdraft fees, but they literally had like 18 in the past month. 

 

If you have 2-3 over the past year, they may just ask for a letter of explination as to what caused them and what you've done so it doesn't happen again.

Valued Contributor
chasmith
Posts: 1,062
Registered: ‎05-26-2010
0

Re: overdraft fees

Also, be careful of overdraft LOC transfers too.  I had to write a LOE for those, even though my LOC could only be accessed by an overdraft or a check - no transfers.

BK7 Filed 8/11/2009 Discharged 11/23/2009. Purchased new home 4/11/2012
Starting Score:11/16/2009 EQ 566 11/16/2009 TU 538
Interim Score: 12/27/2012 EQ 683 09/17/2012 EX (lender) 670 1/01/2013 TU 701
Current Score: 11/06/2013 EQ 708 11/06/2013 EX 702 11/16/2013 702 11/06/2013 TU 729
Goal Score: EQ 740 EX 740 TU 740
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MrChairman
Posts: 460
Registered: ‎02-07-2010
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Re: overdraft fees

I have some overdraft fees from this year. I had to write a letter of explanation and heard nothing else about them. I had three for the entire year I think.


Starting Score:TransUnion: 698 (12 FEB 2010), Equifax: 674 (12 FEB 2010)
Current Score (Lender Pulled):TransUnion: 695 (26 JUN 2013), Equifax: 636 (26 JUN 2013), Experian: 670 (26 JUN 2013)
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seigex
Posts: 425
Registered: ‎05-16-2012
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Re: overdraft fees


MrChairman wrote:

I have some overdraft fees from this year. I had to write a letter of explanation and heard nothing else about them. I had three for the entire year I think.


same for me, I had 5, I only provided two months of bank statements, but on the statements there was an "overdraft fees ytd" and I had to write LOEs for the amount, a couple were my fault, and 3 of them were reversed the next day... never heard another word

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Established Member
lifeafter
Posts: 71
Registered: ‎12-26-2012
0

Re: overdraft fees

I've had quite a few overdraft fees. I didn't know that would be an issue. After all I pay for the overdraft protection . All my bills have been paid on time. The bank never has returned a check (that was my rational, now and moving forward, I know better and have taken steps to avoid future overdrafts...but it might be too late for this home closing is my fear. I was preapproved for a home loan. I found the home I wanted, negotiated the price. Everything was going great. My broker said everything looked great. The appraisal was ordered and came back several thousand above what I am (hopefully) paying for the house. Then he asked for my bank statement. This being Dec it showed exactly how much I have shelled out this past year due to overdraft charges. He first thought we should wait until my next bank statement comes out which would be around the middle of Jan. Then he said he had spoken with an account rep who said it shouldn't be an issue if I write a letter of explanation. I've done that but waiting to hear... This is so nerve racking. Anyone have any thoughts about my chances of actually closing. Btw, its a USDA guaranteed loan if that matters. Also, this may not be relevant to this topic but my real estate agent set the closing date for the end of this month but my broker has said from day 1 that it would be more than likely mid Jan before I could close. Now, I guess that's if I get to close. If anyone can offer any insight it would be greatly appreciated. Obviously, I don't know much about buying a home or the closing process.

Contributor
leppy2
Posts: 127
Registered: ‎12-11-2012
0

Re: overdraft fees

My LO has assured me that the overdraft fees aren't a problem. I am in underwriting as we speak. I will let you know when I hear anything. I'm praying that an LOE wil take care of it. Mine is also usda guaranteed.

My real estate also set our closing for Dec 28. My LO said mid Jan. Fortunately our seller is willing to wait. My LO has said usda turn around is 2 weeks at this point.

Our appraisal is scheduled for Monday. Praying that is turns out in our favor.

Good luck!
Contributor
leppy2
Posts: 127
Registered: ‎12-11-2012
0

Re: overdraft fees

Also, you can have a VOD done instead of bank statements. Although once it has been seen by the underwriter it is probably too late for that option. You could speak with your broker to find out.
Established Member
lifeafter
Posts: 71
Registered: ‎12-26-2012
0

Re: overdraft fees

Thank you. My broker did have me  get a VOD from my bank. But I still had to turn in the bank statement and  write a letter of explanation. I'm keeping my fingers crossed but I do stress about it quite a bit. I will keep my fingers crossed for you too and anyone else going through this closing process. Its awful! I'm sure it  will be well worth it to those who get to cross the finish line.  Keep us posted on how yours goes and I will do the same.


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