topic Re: Underwriting wait.. a nightmare! in Mortgage Loans

Underwriting wait.. a nightmare!

Anonymous — Tue, 19 Apr 2011 15:36:27 GMT

So, I have a contract on a new build. They think wonders of their Lender and they have been fantastic. Was given a plan of action end of March. TU was my mid score at 625 and was still getting some "refer" back on the AU. Well completed plan of action and bumped that score up to 640. She said she got a proceed notification this time but there was still a caution which she tells me not to worry about.. Actually this whole time they're telling me not to worry LOL.. Yeah RIGHT!

Here's my situation: I had 2 BK's. one in 2002 and one in 2004.. The 2004 is already OFF of my TU report but due to come off my other reports in August. The 2002 will be off next April. Hindsight being what it is, I should have just watied until they were gone.. but anyway.. I had collections accumulated between 2006 and 2008--all now paid off. I submitted letter of explanation stating that when i was married my husband owned the home (my name was not on deed or mortgage as at the time he financed it I was still in Chap 13 repayment) but he had an ARM mortgage that jumped from a payment of $995 to over $1400. At the time i made about $14,000 less than I do now. I had to let my bills slip to make sure the house payment was made. We split up in 2009. Later that year i got a promotion and raise and have subsequently paid everything off. There also was a 30 day late from April of 2010 on an account that i'm a co signer on that i submitted a letter stating I have since taken over the account..

I have given them every piece of documentation that i can think of, those letters of explanation, more paystubs, bank statements and W2 and 1040's than i needed.. I have positive lines of credit that aren't that old though. New car in Dec.. 2 CC's as of Nov..

And yet the LO said she thinks it will be fine.. I'm freaking the heck out.. Its for a USDA loan... she said i could do FHA if this didn't fly but i had to pay a small loan i have off first.. I just want an answer one way or the other... i need to move!

Opinions? My DTI is ok.. My scores are 580, 640, 688.. and i think if those BK's weren't there I wouldn't be worrying as much.. but they are. Ugh.. April, Ohio

Re: Underwriting wait.. a nightmare!

Anonymous — Tue, 19 Apr 2011 17:19:06 GMT

All I can do is sympathize, Alley! My underwriting was super smooth (approval at 3pm the day she started on my file - yesterday), now I'm driving them nuts trying to make sure that they request EXACTLY what they want from my contractor (it's a 203k loan). I did go through my fair share of suffering in the steps leading to this, though. I'd keep paying my bills on time and take up yoga if I were you.

Re: Underwriting wait.. a nightmare!

Anonymous — Tue, 19 Apr 2011 18:49:42 GMT

Thanks Mauve... I hope mine goes smoothly.. Lord knows I gave them every document I could think of that they could need including my divorce decree.

I just keep reading the horror stories of "lates or collections after bankruptcy is the kiss of death" and think, well crap there goes that. But I wouldn't think my lender would persue it as dilligently as they have if that was really the case. They were in 02 and 04 and lord knows one will be off in Aug and the other in April.. I mean i could just wait and be good as gold...

I'm glad they are re assuring me that they think things will be fine but I just don't "feel good" about it.

I'm told today that we should have an underwriter here real soon (they were back logged)

Re: Underwriting wait.. a nightmare!

Anonymous — Tue, 19 Apr 2011 18:57:10 GMT

If the lender is telling you it should be okay, there are maybe some compensating factors that are in your favor. Take up yoga. It really does help. I went through the same in March. I kept being terrified and my lender worked it all out.

Re: Underwriting wait.. a nightmare!

Anonymous — Thu, 21 Apr 2011 15:28:54 GMT

Well, underwriting came back as "suspended" to which my LO said well, its good because it means it isn't denied.. The hoops i have to jump thru is as follows:

2-3 more alternate credit references (utilites and such) --got those over yesterday

Statements of some sort of savings.. all i have is a profit sharing account and a whole life policy. I can't borrow off my profit sharing but i can my life but it only has a cash value of like $200.. bad? i don't know.

Pay off my small personal loan which as of yesterday owed $1480 on it.. anyone want to buy a truck?? lol... I can have it paid by the end of may i suppose. This is because i came in at 41.6% and i need 41%

find homeonwners insurance less than $500-- check-- got that to her yesterday too

rental verification.. had been paying 700 until this month and it got re negotiated.. well the re neg. price would create payment shock which isn't good so i had to contact him to please send the verification that i had been paying 700 until 3-1.. Done.

and finally there are some collections on Experian showin still in dispute which shouldn't be. I had to call them and have them send something with the changes.. that should be in route.

So other than paying off this loan and waiting for some documents to come in, thats where I am.

SERIOUSLY--A PAIN IN THE BUTT!!!

Re: Underwriting wait.. a nightmare!

Anonymous — Thu, 21 Apr 2011 15:50:40 GMT

I'm in a holding pattern over my 401(k) loan. Yes, I know it's a "bad" idea to take out a loan from your 401(k)...I just didn't think the "bad" part would be "they don't disclose the timeline that you need to apply for it within" - the only time information on the website is that you can pay to expedite the shipping on your check - no note that it's a 4 - 5 week process involving 1) applying on the website 2) waiting for them to see the request 3) waiting for them to mail you the application materials via the USPS 4) you filling out the forms and mailing them back with proof of the home purchase / closing cash 5) them reviewing and processing (5-7 BUSINESS DAYS 6) them issuing a check (another 3-5 business days) and 7) them mailing it to you

I've sped it up by faxing the info. I now call every day to see if it's been processed yet. I waited to apply until I had the requisite proof from my lender that they require. Submitted on the 13th. They mailed the application on the 14th, which was less than the 3-5 business day timeframe for that. I received it on the 18th and faxed it to them that morning. I called them that afternoon to make sure that it was received and complete. When it had not been processed on the 19th or the 20th, I ended up emailing the executive office this morning. They are researching and getting back to me. I told them that if I didn't have it by the afternoon of the 25th, I would have problems closing and that if they had the information available on their website, I would have applied sooner to meet their timeframe. I was told that it's really 4-5 weeks start to finish at the max timeline. Wow. Seriously. Wow. If I had known that prior, I would have done this earlier with the rougher earlier numbers!

Side note: you can pay $25 to have the check overnighted. That's the only timeframe they have on their website. They don't mention that you can ONLY have it overnighted to your home address, that someone over 18 has to be home to sign for it, and that they won't contact you in any way to tell you that it HAS been overnighted. What, I'm supposed to just hang out at home all day for weeks to get it? They know I work - you can't take a loan against a 401(k) if you're no longer employed by that employer! Also, they know WHERE I work - why isn't that an address option? Anyway. I escalated to the Executive office and have received email that they're investigating. Hopefully that will work.

And I thought negotiating price with Freddie Mac would be the longest process.

Re: Underwriting wait.. a nightmare!

Anonymous — Thu, 21 Apr 2011 15:56:44 GMT

Ok thats nuts.. I know my guy was able to get his loan from his 401(k) like within a week and a half! but everything was online.

I wish i had the option to take a loan out on my funds but we can't even touch it until retirement! ACK.. Life in a small office.. i guess i should thank my lucky stars we even have a plan.. but i have no control over how much goes in it or anything.

Well i did list my old truck for sale.. we'll see if i can get a buyer for it and that will take care of that little loan balance and i won't have to stress out about it any more.

I still think i should have waited the more we go thru this process. I had those 2 BK's one in 02 and the other in 04 that once they're gone (august of this year and april of next) I probably wouldn't be jumping thru these hoops! But it is what it is.. and here i sit with bitten down fingernails from stress and a headache that won't go away!

Re: Underwriting wait.. a nightmare!

Anonymous — Sat, 23 Apr 2011 04:18:26 GMT

My LO seemed concerned with my credit...I have 5 cc excellet standing all $0 bal except $7 on one, car loan excellent standing(2008), no collections, no lates for over a year or two, BK discharge 4 years ago, BUT since my mom does not charge rent I need to show more credit?? I don't have enough TYPES of credit, WHAT THE HECK?? I have to show utiity bills?? My gas and electric are paid but late, ATT home moblie, DSL and Direct TV never late, and board fees for my horse is never late...should I be worried???

Re: Underwriting wait.. a nightmare!

Anonymous — Sat, 23 Apr 2011 11:49:30 GMT

That was part of my conditions. I had to come up with 2-3 alternative credit references for one thing.. I used my water bill, my cable bill and my gas bill... and though i typically pay every 2 months on those bills I still got good letters from them. Cell phone companies say they don't give letters of credit (at least thats what verizon told me). I asked if I could use my horse board and my LO perfered that I didn't because thats also a debt thats not in the standard formula for debt.

My other "condidtions" were to show a savings.. i have a profit sharing that i can't access unless i retire or quit, and a whole life policy that accumulates a cash value that I CAN borrow on but it doesn't have much of a valure right at the moment... Also i had some "disputes" showing up on my Credit file.. i had to call and have them removed-- strange since i dont' have any disputes out right now..

So I've met all my conditions.. So off to underwriting I go again.

Oh the fun part?? I get to do this twice because after my loan co.'s underwriter i have to go to Rual Housing underwriting... happy happy joy joy..

Re: Underwriting wait.. a nightmare!

Anonymous — Sat, 23 Apr 2011 15:55:11 GMT

OH BOY!!! Well as far as investments the only thing I have are three total control accounts for my kids, I can't draw on them yet, they total $90K and I pay my gas every month but in the middle of the month, I hope I only have one underwriting to do...UGH!!! I am wishing you luck on that!!!

Re: Underwriting wait.. a nightmare!

Anonymous — Sun, 24 Apr 2011 06:31:55 GMT

Double underwriting?

Also, wow, you both have horses?

Re: Underwriting wait.. a nightmare!

Anonymous — Sun, 24 Apr 2011 13:27:01 GMT

Yep.. Double..

and forgive my non techincal terms but basically my LO submitted my file to their underwriters which came back suspended with conditions.. which I'm fairly certain I've met (guess we'll find out this week) and once I'm thru with this batch of fun, since I'm going for a USDA loan I have to go to the Rural Housing underwriters next..

Loads of fun.

Fortunately my LO said her underwriters are generally quite thorough so they "usually" don't have any issues with Rural Housing once we hit this point. Guess we'll find out. I didn't object to doing FHA either and told them whatever gets the job done do it. My interest rate would just be higher with FHA and the PMI comes into play then. I'd rather keep my payment as low as possible so thats why we're going USDA first.

Both my LO and my Real Estate gal are impressed by the work I've put into this and I can honestly say I wouldn't be this far w/o this board LOL.. One of my conditions was that I pay off this loan that listed on my CR had a balance of $1700 but fortunately the payoff was $1400.. well by God I sold my old truck to pay that off and that was probably the biggest hurdle.. my dti was 41.6 and now is 38% and that factors in everything HA! Take that mortage gods!! I shall overcome!

lol..

I wish the process was faster though.. the stress has set my fibromyalgia off and i'm sore everywhere. I think i DO need to take up yoga LOL..

Yep.. horse person here. But I'm not trying to buy a farm.. I'm finding after years of having multiple horses, I'd rather just pay someone else to feed and care for her so i can just show up and ride

April

Re: Underwriting wait.. a nightmare!

Anonymous — Sun, 24 Apr 2011 14:47:02 GMT

Jealous about the horse, not the fibromyalgia. My underwriting was quick and painless, but the problem became that the UW initially had my proof of closing funds as an approval condition - my LO got her to change it to a closing condition, which will make it infinitely easier to get done on time. "On Time" is a month after the initially agreed-upon closing date, though. Per the executive office, I'll have my funds in hand on Tuesday so I should be able to close on Thursday, assuming everything else goes right.

Re: Underwriting wait.. a nightmare!or

Anonymous — Sun, 24 Apr 2011 15:47:09 GMT

Hi Mauve, Yep horse person #2!!! That is one of the biggest reasons I am doing this, I tried for the USDA last year but my BK wasn't old enough...They offer 100% financing!!! This go round I am approved for the standard FHA and 203k so if this one falls through I have the FHA also...I have the perfect place for me the hubby 4 kids,2 dogs, 1 cat, 1 rabbit and the horse...LOL!!!! I am putting in my offer in the morning, I plan on bidding the asking price maybe 5k over hoping they will pay closing and half down payment for a 30 day close...all totaled they would still be getting close to the asking price minus $2k...if it were me the seller I would take it there are two other offers on the table but the seller hasn't accepted either!!!! YEA!!! The house has been on the market almost 2 years!!! We will see!!! I am wishing you the best this week I hope all goes smoothly for you and alleycat!!!

Re: Underwriting wait.. a nightmare!or

Anonymous — Mon, 25 Apr 2011 12:53:06 GMT

Good luck! I don't think you can do a 30 day close with USDA or with FHA, especially with a 203k.

If it's been on the market 2 years, I'd be really surprised if you needed to offer over asking price at all. I did on a house that had been on the market for less than a week when I knew I had competition, but I had to ask for a reduction later when the appraisal came back low. BTW, if you're offering to Freddie or Fannie, apparently you can usually ask for up to 6% in closing (if I remember right) and you'll want to put that in the offer as a $ amount so it's easier for them to do the math.

Re: Underwriting wait.. a nightmare!or

Anonymous — Mon, 25 Apr 2011 15:28:16 GMT

Well get this nosey me checked the house through the Ohio auditor's website and got all the 411 on the house EVEN the bank that owns it, the sellers agent has been very difficult and not real forthcoming with ANY info so I did a little digging myself!!! The home is owned by PennyMac in LA!!! So that was VERY helpful!!! I got the survey of the land and previous owners names and the circumstances of sale and foreclosure...

I have never heard of PennyMac but I am assuming they are gov't I did pull up the site but have not had an opportunity to dig deeper I plan to today. Thanks so much for the feedback...I had to laugh because I will have to break it down to the dollar amount so that they will understand it better!!!! LOL!!! I will certainly do so...my concern was over bidding because I know that the appraisal will show less especially because there is $50k worth of work to be done...they are also NOT allowing an appraisal prior to a bid, no surprise there that's for sure!!

No concerns about the close date, my agent told me with FHA the closings usually take longer anyway. How did things work out when you renegotiated the offer price were the sellers reluctant to work with you to lower the price?? This is an REO and I have the feeling they will stay firm on the selling price. The price of the other homes in the area are selling at the same price $130k...but the homes further up the street are going for $500K and higher, same sqft and property size just in MUCH better condition....

Re: Underwriting wait.. a nightmare!

Anonymous — Mon, 25 Apr 2011 15:45:20 GMT

Ok.. too funny.. you're in Ohio too.. I'm in Columbus trying to buy in Commercial Point

My conditions are being sent to the underwriters so the wait begins again.. Anyone want to bet that they come back with more conditions?? lol..

Seriously, I paid off that small loan, paid off a small collection that was so old it was going to come off next year anyway, gave them more letters of credit and got a home owners quote for lower than what they wanted.. COME ON already!!

Course better they be thorough I suppose since it has to go to Rural Housing next.

Just goes to show.. Credit scores are NOT everything lol..

Re: Underwriting wait.. a nightmare!

Anonymous — Mon, 25 Apr 2011 15:52:17 GMT

I know right?? I feel so EXPOSED!!! LOL!!! I am so glad that I am a good record keeper, I have 2 accordian folders of stuff one is just for gathering info for FHA!!! I have been taking note on the documents I have seen others produce for this process and everytime I see something new I will add it to their folder!!! I should invest in Dell inkjet and kinko, fedex and ups!!!!

Re: Underwriting wait.. a nightmare!

Anonymous — Mon, 25 Apr 2011 15:57:44 GMT

I am in the same boat as you guys and this is not fun at all... I can't wait for all of this to be over. Just out of curiosity, where do you obtain letters of credit from? Can it be utility company, cell phone, etc?

Re: Underwriting wait.. a nightmare!

Anonymous — Mon, 25 Apr 2011 15:59:31 GMT

Yep.. If you call your utilities and ask for a letter of credit they'll generally know what you're asking for unless you get a newbie. I used to work for Time Warner back in the day and we had a credit manager that did all that stuff..

Phone, Cable, Water, Electric, and Gas.. they all do them. Cell phone doesn't.. ironically