topic Pre-approved! But... in Mortgage Loans

Pre-approved! But...

Anonymous — Mon, 16 Mar 2015 17:46:39 GMT

My LO is asking for LOE on some late payments and on a charge off for a credit card. The last late payment was made in June of last year and the charge off is from about 2 years ago. The problem is I really don't have good reason for them. At the time I was suffering from depression to the point where keeping up on my finances was difficult. I could pay bills online and the money was always there on the auto deducted ones, but this one was paid using a coupon book that I couldn't find so I just paid whenever they made a collection call. They wouldn't call until it was about 45 days late so every other month was 30 days late for about 2 years. I got treatment for my depression, got a new coupon book and the payments has been on time ever since.

As for the credit card charge off, it was auto deducted but it suddenly stopped autodeducting so I figured it was paid off. Didn't realize it wasn't and couldn't be bothered to confirm it so now it's charged off.

Anyway, does anyone know how I might put these down in a letter? I wish I had a good reason for them but really I don't. I've become so much better organized now and don't plan on going back there but I don't think they would take my word for it. Thoughts?

Re: Pre-approved! But...

Anonymous — Mon, 16 Mar 2015 17:51:41 GMT

Tell them exactly what you just told us. You just gave us a rundown of a medical situation that caused you to have some life problems, which you have resolved. That should be plenty to make them happy.

Re: Pre-approved! But...

Anonymous — Mon, 16 Mar 2015 18:28:19 GMT

@Anonymous wrote:
The problem is I really don't have good reason for them. At the time I was suffering from depression to the point where keeping up on my finances was difficult.

That, right there, is a legitmate reason. Depression is a legitimate medical difficulty, especially before diagnoses and dialing in on treatment (even after, but moreso before).

I agree with the above poster; what you just explained to us is what you should write in an LOE.

Re: Pre-approved! But...

Anonymous — Mon, 16 Mar 2015 18:32:13 GMT

When I originally applied for my mortgage I sent a LOE for a collection that has since dropped off. The underwriter actually called me to thank me for being honest when I simply explained the collection by saying I should have paid this. I was dumb. It has since been paid, and I learned my lesson. The collection was for a few parking tickets, and that was the only real explanation.

Re: Pre-approved! But...

Anonymous — Mon, 16 Mar 2015 18:32:38 GMT

Ok, thanks, that makes me feel better. I guess I'm just worried that there's still a stigma attached to it and wouldn't be taken seriously. I'll spell it out in my letter and hope for the best!

Re: Pre-approved! But...

Anonymous — Mon, 16 Mar 2015 18:38:59 GMT

If they pre approved you with a LOE as a condition, they want to loan you the money, they just want to know a reason for a past mistake. I might even toss in a line about how your rent or current mortgage was never late during that time but due to your medical condition which is now recieving treatment made some things difficult to deal with. And how your now improved credit scores are important to you.