topic Re: Help, I'm scared of losing my mortgage in Mortgage Loans

Help, I'm scared of losing my mortgage

Anonymous — Wed, 01 Apr 2015 23:55:01 GMT

I certainly hope someone can help me. I am emotionally drained and scared. I am a single mom and worked very hard on rebuilding my credit. I was pre-approved in early Feb with my mid-score right at 640 on the nose. Found the house of my dreams, made the offer, ordered home inspection, rented a dumpster to clean out my rental home, and was telling the world how happy I was! After a few weeks, I started to wonder about closing, so I contacted my mortgage lender who assured me all was fine, we were just waiting on UW. I called my realtor, we set up a closing date and final walk through. I was so excited, thinking I would finally get to move this weekend. Not 45 minutes after I spoke with my realtor, the mortgage lender called and said UW found a student loan in dispute, he immediately sent me paperwork to send to all credit agencies to have them removed. He also explained that it might lower my score because of a false fico score. I am now getting fico alerts and watching my scores drop 25 points as they are updated!!! I didn't have any points to lose! Lender said he will send it to a rapid rescore specialist but I doubt they will be able to gain that many points! Anyone had this happen and get it resolved? I'm so afraid and this has been the longest last week of my life!

Re: Help, I'm scared of losing my mortgage

ezdriver — Thu, 02 Apr 2015 00:48:40 GMT

I feel very bad for you. Was that student loan dispute not on your credit report?

Anyway, removing disputes often result in lowered scores. That said, there are lenders that will approve FHA loans with scores lower than 620. Hope this works out for you.

Re: Help, I'm scared of losing my mortgage

Anonymous — Thu, 02 Apr 2015 01:09:23 GMT

The problem is that I am doing a KHC (Kentucky housing Corporation) loan with down payment assistance. I have to meet their guidelines and also FHA . Can't have the word dispute on there anywhere. The word dispute is certainly coming off and everything else is coming off as well like my scores! My score has to be at 640. My lender said the dispute was not showing on there during the original pull, underwriting repulled and found it. I have no idea why it decided to show up 3 months later. My lender is going to try to get it rescored. This has been the longest week of my life. I was supposed to be moving this weekend, and closing today. The only reason I disputed the student loan back in December was because I am in good standing with them and have been for a while, on a credit monitoring site I disputed it online, and with one click of a button, it has caused me so much trouble that I may lose the house.

Re: Help, I'm scared of losing my mortgage

cem13 — Thu, 02 Apr 2015 02:55:28 GMT

@Anonymous wrote:
The only reason I disputed the student loan back in December was because I am in good standing with them and have been for a while, on a credit monitoring site I disputed it online, and with one click of a button, it has caused me so much trouble that I may lose the house.

I am sorry that you are going through hell. Like mentioned before, disputes are noted on your CR and then that T/L is not used in scoring until it gets resolved either way. Once the dispute is removed (without imporvement) the scores drop to where they would have been normally. So your scores did not drop, you artificially raised them with the dispute.

My issue is that the U/W did not see the dispute before. I would bet anything that the first pull showed the dispute and the U/W missed or over looked it. They are human too. I am not sure there is anything that can be done for you. Maybe you can take away something positive from all of this. You should understand everything you can about CRAs and the scoring. Next time you will not get tripped up.

Good luck and God Bless. Keep us up to date on your progress.

Re: Help, I'm scared of losing my mortgage

Anonymous — Thu, 02 Apr 2015 03:30:17 GMT

Thank you, and I will keep this updated so that it may be beneficial to someone else in the future. The good thing is that so far my score dropped 25 points not 75 or anything too dramatic. My only hope is that the rescore specialist may be able to find something worth rescoring that can give me the points I need. I am doing everything they told me to do, I am keeping my credit card at a 4% utilization, lower than what they told me, I am paying my bills on time if not before the due date every single month. Lesson definitely learned that I did not know about. I had the same question why the lender did not let me know this sooner? Had I known sooner, I could've had more time to boost my score up. They used an automated underwriter. My other question is that since I filed the dispute back in December I don't know why it was just showing up. Disputes are supposed to be resolved within 30 days, and to me that almost seems like an error on my credit report. If it was filed in December, it should've either been resolved and taken off of my credit report, or dispute status should not have been showing in March. But I am not the expert here. All I know is I'm disappointed. I tried so hard...if you only knew...

Re: Help, I'm scared of losing my mortgage

Lemmus — Thu, 02 Apr 2015 05:15:00 GMT

...patience! ...all may not be lost as yet ...under KHC and FHA guidelines, a manual underwriter has the ability to approve you using the totality of your file despite the score not quite being there ...doesn't mean they will, but until they definitely say no, its more than a possibility ...hth

Re: Help, I'm scared of losing my mortgage

apeydee416 — Thu, 02 Apr 2015 12:06:33 GMT

Question, why was the student loan disputed and did it resolve in your favor?

Re: Help, I'm scared of losing my mortgage

Anonymous — Thu, 02 Apr 2015 13:12:19 GMT

The reason I disputed the student loan, is because I have been in good standing with them for quite some time. I read about Lexington Law getting them removed if you were in current good standing with them, and read several other forums about how people have had them removed. But it takes a lot of time to get them removed and you have to stay on them. Back when I was working on repairing my credit in order to purchase a home I didn't know any better. The fact that the dispute did not get removed, I thought that my request was denied. I have definitely learned the hard way. It did not work in my favor, it is still on there. I was notified last Thursday, March 26 that underwriting found the dispute. Today is April 2, I should know something soon, Lender told me that it is a 5-7 day turnaround time for them to get the dispute wording off and for it to be reassigned to a rescore specialist. So far, I think 2 of the 3 have already come off because of my alerts that I got on here. Lesson learned the hard way! I'm also not sure my lender uses a live person underwriter, I think they use the automated one.

Re: Help, I'm scared of losing my mortgage

Lemmus — Thu, 02 Apr 2015 13:37:20 GMT

...afaik all mortgage lenders use a living breathing human underwriter on every loan they approve ...the automated processes are a preliminary review to determine basic internal and govt loan eligibility ...it only determines what the underwriter is required to do in addition to the basics

Re: Help, I'm scared of losing my mortgage

Anonymous — Thu, 02 Apr 2015 13:43:11 GMT

Thank you! This is certainly a stressful period, but also a learning experience! I have not thrown in the towel yet, but this is wearing on my nerves! Fingers crossed and I will keep everyone informed in case this happens to someone else and a dispute shows up in underwriting right before closing!

Re: Help, I'm scared of losing my mortgage

StartingOver10 — Thu, 02 Apr 2015 14:03:02 GMT

@Anonymous wrote:
The reason I disputed the student loan, is because I have been in good standing with them for quite some time. I read about Lexington Law getting them removed if you were in current good standing with them, and read several other forums about how people have had them removed. But it takes a lot of time to get them removed and you have to stay on them. Back when I was working on repairing my credit in order to purchase a home I didn't know any better. The fact that the dispute did not get removed, I thought that my request was denied. I have definitely learned the hard way. It did not work in my favor, it is still on there. I was notified last Thursday, March 26 that underwriting found the dispute. Today is April 2, I should know something soon, Lender told me that it is a 5-7 day turnaround time for them to get the dispute wording off and for it to be reassigned to a rescore specialist. So far, I think 2 of the 3 have already come off because of my alerts that I got on here. Lesson learned the hard way! I'm also not sure my lender uses a live person underwriter, I think they use the automated one.

I just want to point out something here for you and for others - there is never a good reason to remove accounts in good standing from your credit file.

You want a good long deep history showing you repay your loans and revolving accounts. Student loans are helpful unless they have a large payment and you haven't paid them off and they are interfering with a mortgage approval. As you can see, even if you have old late payments it is better to have the tradeline rather than risking trying to remove it.

Lexington Law is more about advertising than actual results and most of us have discovered it is better to take care of our own credit issues rather than hiring a third party that doesn't have as much authority as you do to remove errors from your own report. Research in the rebuilding forum for LL stories to get a better idea.

Anyway, don't lose hope. Shanethemortgageman has a great thread on how to remove disputes right here on the mortgage board.

Re: Help, I'm scared of losing my mortgage

Lemmus — Thu, 02 Apr 2015 14:26:32 GMT

@StartingOver10 wrote:
Lexington Law is more about advertising than actual results and most of us have discovered it is better to take care of our own credit issues rather than hiring a third party that doesn't have as much authority as you do to remove errors from your own report. Research in the rebuilding forum for LL stories to get a better idea.

^^^^^++++++++...what SO10 said in spades ...LL sells a good story, promises a lot, and in simple cases, often delivers ...for a substantial price ...my own experience with them was that there was a flurry of activity and then it slowed waaaaaaaaaay down ...the minimum monthly activity necessary to keep my payments to them coming ...finally dawned on me that this was deliberate on their part and definitely not in my best interests ...ditched them, used the templates on the credit repair forum and lo and behold, they worked ...for the cost of a stamp and a green card ...hth

Re: Help, I'm scared of losing my mortgage

Anonymous — Thu, 02 Apr 2015 14:33:00 GMT

I certainly did not use Lexington Law back when repairing credit, I read too much bad about them! I only read about it online, but I also read online about others getting their disputes removed. What's done is done, with one click of a button I disputed the item back in December online. I'm not going to cry over spilled milk, what's done is done. Now I'm focusing on how to fix the problem.

Re: Help, I'm scared of losing my mortgage

apeydee416 — Thu, 02 Apr 2015 14:34:29 GMT

Is it reflecting like it is currently in dispute? or dispute resolved?

Re: Help, I'm scared of losing my mortgage

Anonymous — Thu, 02 Apr 2015 14:37:42 GMT

It is reflecting as it is in dispute status. However EQ and EX have already removed the dispute, and is now showing "pays as agreed." waiting on TU.

Re: Help, I'm scared of losing my mortgage

Anonymous — Tue, 07 Apr 2015 00:56:09 GMT

Update: the disputes came off and it lowered my score 26 points no longer pre-approved. Now, the only thing I have going good is the people who live in the home I am trying to purchase are in no hurry, so I have some time. LO and credit advisor told me to pay the 2 items in collections and get a letter that stated they would remove it from my credit report. Pay for Deletion. I got one of them taken care of with ease. Enhanced Recovery is another story! They told me they would give me a letter it was paid but not remove it from my credit. I have to have this removed, ugg! If I get in this house it will be a miracle! What can I do? I thought about calling a local attorney that deals with fair credit. If I paid it, they need to remove it! Help again!?

Re: Help, I'm scared of losing my mortgage

Lemmus — Tue, 07 Apr 2015 01:39:39 GMT

...its important that you understand that they do NOT have to remove a paid collection under the FCRA ...in fact, it probably against their agreements with the CRAs ...the PFD works with some CAs, not others and there is nothing you can do to force them to remove it, paid or not, once its posted, unless they fail to validate ...and if you paid, you validated ...I know thats not what you want to hear but its wasting your time and money to hire an attorney for that purpose ...repeated GW letters to different CA officers is probably your best bet

Re: Help, I'm scared of losing my mortgage

Anonymous — Tue, 07 Apr 2015 01:47:21 GMT

Not what I wanted to hear. I will have to figure a way. I'm not throwing in the towel yet

Re: Help, I'm scared of losing my mortgage

Lemmus — Tue, 07 Apr 2015 01:57:12 GMT

...just wanted to add that I'm sorry to see this happen ...I looked at the KHC credit score guidelines and it appears that 640 is indeed the minimum required to qualify ...are you in an urban or rural area ...the reason I'm asking is that USDA Rural loans can be a lot more flexible and you may not need the KHC assistance.

Re: Help, I'm scared of losing my mortgage

Anonymous — Tue, 07 Apr 2015 02:05:44 GMT

Lemmus, I want to thank you for looking that up. Not only do I have to meet KHC guidelines, but also FHA, or I lose the down payment assistance. Unfortunately, no, it does not qualify for USDA, checked that too! I'm backed in a corner. The account in collections is Sprint. My LO said I'd probably have better luck calling Sprint directly and ask for a pay for deletion. I tried that but they wont talk to me because I can't remember my PIN number and they say my security answers are not matching.