topic Re: Question on Checking Acct Statements that LO requires for USDA GUS in Mortgage Loans

Question on Checking Acct Statements that LO requires for USDA GUS

SSTO — Tue, 10 Dec 2013 22:04:04 GMT

My Loan Officer said he would need my past two months of banking statements. I'm not worried about anything else - Fico will be over 660, I have been with my employer for 13 years, DTI is fine... but my banking statements worry me - I tend to live month to month and shop a lot. Will spending my money and not saving it disqualify me for the loan? What exactly are they looking for with the bank statements?

Re: Question on Checking Acct Statements that LO requires for USDA GUS

Peter1142 — Tue, 10 Dec 2013 22:39:01 GMT

No one is going to be looking that closely at your file unless they are looking for compensating factors it doesn't sound like you need. They just want to see where your money is coming from, I.e. to confirm funds weren't borrowed.

Re: Question on Checking Acct Statements that LO requires for USDA GUS

StartingOver10 — Tue, 10 Dec 2013 22:43:27 GMT

They will also check to make sure you don't have any NSF's or OD's. Having one or two over the course of a year can be explained. Having a bunch shows difficulty in financial management.

Re: Question on Checking Acct Statements that LO requires for USDA GUS

Peter1142 — Tue, 10 Dec 2013 22:44:56 GMT

Actually, to add to that list, they also looked on mine for undisclosed debts.

Re: Question on Checking Acct Statements that LO requires for USDA GUS

StartingOver10 — Tue, 10 Dec 2013 22:50:33 GMT

Yes...payments made monthly that weren't disclosed to the lender or those that don't show up on the credit report.

Re: Question on Checking Acct Statements that LO requires for USDA GUS

Anonymous — Thu, 12 Dec 2013 01:18:35 GMT

My statements were horrendous and embarrassing. I almost didn't apply, but we "closed" yesterday and get keys tomorrow. :-)

Like the others said they want to make sure you're not hiding debt or using borrowed money to qualify for anything.

Re: Question on Checking Acct Statements that LO requires for USDA GUS

DallasLoanGuy — Thu, 12 Dec 2013 03:53:44 GMT

@Peter1142 wrote:
Actually, to add to that list, they also looked on mine for undisclosed debts.

YES we do.............

Re: Question on Checking Acct Statements that LO requires for USDA GUS

SSTO — Thu, 12 Dec 2013 04:15:07 GMT

That is exactly how I feel. I am not hiding any debt at all and will not/have not borrowed any money at all, but I feel embarrassed about my spending habits and that I do not have any money saved.

But CONGRATS to you on getting your keys tomorrow and your closing yesterday! May I ask what type of loan you got and what your FICO was at the time? I plan on going the USDA Guaranteed route and my score pulled by the Lender was 652, but he wants me to apply when I'm at 660.

Re: Question on Checking Acct Statements that LO requires for USDA GUS

SSTO — Thu, 12 Dec 2013 04:19:01 GMT

That's good to know that checking for additional debt and borrowed money is what you focus on with the banking statements. My issue is that I tend to spend my money - zero out and then I get paid again and do the same thing...it's a bad habit that I'm having a difficult time breaking, but am very afraid that they'll say that my lack of savings (none basically) and my spending habits make me a high risk - even if my FICO is okay (going with a USDA and LO said I need 660 (I'm at 652 now).

Re: Question on Checking Acct Statements that LO requires for USDA GUS

coterotie — Sat, 14 Dec 2013 14:54:14 GMT

Then you have to "trick" yourself.

So look at last month and determine what spending was "frivolous."

Let's say the number is $500. So we'll reduce the frivolous by 20% first month and 25% second month.

So open a sharebuilder account. They will let you buy stock for next to nothing. Right now the XLF ETF is selling for ~21/share. It represents the largest financial institutions and is remarkably stable, pays a dividend and gives you a nice broad exposure to the overall US and world economy. Sign up to buy 5 shares each month. When you get to 50 shares switch to another ETF like the XLK which is technology focused. It is ~$34, buy 5 shares each month.

How do you fool yourself? They take the money out automatically each time you get paid, so it never really hits your checking account. You don't have it you can't spend it.

Wouldn't it be nice 10 years from now to wake up with $25,000? And all it cost you was foregoing one $5 latte each workday. You can still treat yourself on the weekends if you want.

BTW, 30 years from now, even if you stopped making the purchases at the end of the 10 year period, you would likely have $200,000+, all without having to be a genius and pick the next AAPL, AMZN or PCLN.

@SSTO wrote:
That's good to know that checking for additional debt and borrowed money is what you focus on with the banking statements. My issue is that I tend to spend my money - zero out and then I get paid again and do the same thing...it's a bad habit that I'm having a difficult time breaking, but am very afraid that they'll say that my lack of savings (none basically) and my spending habits make me a high risk - even if my FICO is okay (going with a USDA and LO said I need 660 (I'm at 652 now).

Re: Question on Checking Acct Statements that LO requires for USDA GUS

Anonymous — Sat, 14 Dec 2013 19:30:25 GMT

Sorry for the late response. I've been moving! Ahhh, still doesn't feel real. My FICO was around 640 and DH was 670. We got FHA, but were approved for a 5% conventional but was denied by the mortgage insurance company due to my time on job.

Re: Question on Checking Acct Statements that LO requires for USDA GUS

tony46231 — Tue, 17 Dec 2013 13:35:39 GMT

OP was talking about not having any savings. I thought you were required to have so many months of mortgage payments in reserves. Is that not correct?