topic Re: Recently denied a mortgage, in need of some tips in Rebuilding Your Credit

Recently denied a mortgage, in need of some tips

maliblue34 — Tue, 19 Jun 2012 00:05:50 GMT

Hello!

I am new to the forum (Ive browsed occasionally) and I would like some help from the experts! I recently applied for a mortgage with Chase, I was pre-qualified for an FHA Loan, around April, and now my loan officer called me last week to say the underwriter denied my loan. Im so sad, and upset! I went through a few hoops, and I looked at a few places, finally found one that was a nice place , a good deal (short sale for 65K). All for NOTHING, Im upset that the Loan Officer didnt realize (by looking at my credit report) that the underwriter would potentially deny me. He made everything sound like it was a GO and I wouldnt have any problems..smh At the time he told me my credit score was 621 (I filed bankruptcy back in 2005, so in October it should be off my report) I have a few negatives on my report which I wrote a letter of explanation for . (I guess my explanations weren't good enough)

the negatives are:

A 30 day late payment to HSBC from 2010

A dell financial services account that is now in Charge off status (I opened because my ex said he would pay)

Citibank Student Loan payments Which actually show up 4 times on my account - The account was transferred to Sallie mae last year because Citibank isnt handling Student loans. It says transferred to another lender However they wont remove them from my credit report.

....... I would really appreciate some advice as to how I can get my credit score up, or anything else you guys can suggest

Thanks!

Re: Recently denied a mortgage, in need of some tips

scmami — Tue, 19 Jun 2012 03:03:50 GMT

Hi! I have a few questions for you and I'm sure you'll get some answers soon!
1) What Chapter BK did you file?
2)Have you tried to GW HSBC?
3)Why are the students loans a negative? Are there lates on them?

Re: Recently denied a mortgage, in need of some tips

maliblue34 — Tue, 19 Jun 2012 04:08:48 GMT

Hi!

I filed Chapter 7

Im not really familar with the Good Will thing (I first saw it on this site a few weeks ago) Ive only tried calling HSBC, and had no luck with that!

Yes the student loans were late, I wasnt aware that paying the student loan late would effective my credit..smh (Ignorance is bliss...You live & you learn)

Re: Recently denied a mortgage, in need of some tips

maliblue34 — Tue, 19 Jun 2012 17:04:28 GMT

suggestions anyone?

Re: Recently denied a mortgage, in need of some tips

scmami — Tue, 19 Jun 2012 17:42:16 GMT

Hey, from what I understand, Chapter 7 bankruptcies can stay on CR for up to 10 Years...is it different in your state?
I was not aware of Goodwill letters either, but I've had success writing 2 so far and having 2 old/paid negative charge offs removed. I also was able to speak to the credit dept with the company that handles my husband's student loans and they removed all lates! (We had a misunderstanding .....I'd thought a forebearance would backdate over the lates but obviously I was wrong!

Re: Recently denied a mortgage, in need of some tips

JohnPTEX — Tue, 19 Jun 2012 17:44:45 GMT

This is going to get moved to the Mortgage board, but . . .

FHA loans have several general criteria such as two years plus for bankruptcy, no derogatory marks or lattes within the past year, and no balances owed on derogatory/collection accounts over a $1,000 - any of these is grounds for denial - it also entirely depends on who the underwriter is as they all have their own criteria

Can you give us more information?

Re: Recently denied a mortgage, in need of some tips

scmami — Tue, 19 Jun 2012 17:45:27 GMT

Also search the boards on MyFico and Google for any luck with PFDs for Dell Financial Svcs. Is this account showing a balance? Or has it been sold to a collection agency ($0 balance)?

Re: Recently denied a mortgage, in need of some tips

maliblue34 — Tue, 19 Jun 2012 18:05:19 GMT

Why would it be moved to the mortgage board? I want help on getting my credit score up... I wont be applying for another mortgage no time soon.

What more information should I provide?

Re: Recently denied a mortgage, in need of some tips

scmami — Tue, 19 Jun 2012 18:09:20 GMT

When was DellFS charged off and what are the positives on your credit? I don't think they will move it to the mortgage board....it's a rebuilding question.

Re: Recently denied a mortgage, in need of some tips

maliblue34 — Tue, 19 Jun 2012 18:09:40 GMT

Wow SCmami thats great that you were able to get that done! I need to get on top of things! Also you just made me depressed, (Im in NY) I couldve sworn my Bankruptcy was coming off in October..smh

Re: Recently denied a mortgage, in need of some tips

Anonymous — Tue, 19 Jun 2012 18:25:18 GMT

@maliblue34 wrote:
Hello!

I am new to the forum (Ive browsed occasionally) and I would like some help from the experts! I recently applied for a mortgage with Chase, I was pre-qualified for an FHA Loan, around April, and now my loan officer called me last week to say the underwriter denied my loan. Im so sad, and upset! I went through a few hoops, and I looked at a few places, finally found one that was a nice place , a good deal (short sale for 65K). All for NOTHING, Im upset that the Loan Officer didnt realize (by looking at my credit report) that the underwriter would potentially deny me. He made everything sound like it was a GO and I wouldnt have any problems..smh

I know you are upset at the LO, but there's no way for them to know 100% that you are going to get approved, even if your history looked better.

This is a process that might have looked good enough for the LO but because of further intricacies... the underwriter denied it. It can happen to anyone and the LO has nothing to gain from telling you that you could get approved and that it gets denied further along the way.

Re: Recently denied a mortgage, in need of some tips

JohnPTEX — Tue, 19 Jun 2012 18:31:54 GMT

@maliblue34 wrote:
Why would it be moved to the mortgage board? I want help on getting my credit score up... I wont be applying for another mortgage no time soon.

What more information should I provide?

I'm sorry I thought you were looking for mortgage specific credit improvement advice. Do you know who the underwriter was?

Re: Recently denied a mortgage, in need of some tips

maliblue34 — Tue, 19 Jun 2012 18:32:21 GMT

@Anonymous wrote:
@maliblue34 wrote:
Hello!

I am new to the forum (Ive browsed occasionally) and I would like some help from the experts! I recently applied for a mortgage with Chase, I was pre-qualified for an FHA Loan, around April, and now my loan officer called me last week to say the underwriter denied my loan. Im so sad, and upset! I went through a few hoops, and I looked at a few places, finally found one that was a nice place , a good deal (short sale for 65K). All for NOTHING, Im upset that the Loan Officer didnt realize (by looking at my credit report) that the underwriter would potentially deny me. He made everything sound like it was a GO and I wouldnt have any problems..smh

I know you are upset at the LO, but there's no way for them to know 100% that you are going to get approved, even if your history looked better.
This is a process that might have looked good enough for the LO but because of further intricacies... the underwriter denied it. It can happen to anyone and the LO has nothing to gain from telling you that you could get approved and that it gets denied further along the way.

Ok thanks

Re: Recently denied a mortgage, in need of some tips

maliblue34 — Tue, 19 Jun 2012 18:36:07 GMT

@JohnPTEX wrote:
@maliblue34 wrote:
Why would it be moved to the mortgage board? I want help on getting my credit score up... I wont be applying for another mortgage no time soon.

What more information should I provide?
I'm sorry I thought you were looking for mortgage specific credit improvement advice. Do you know who the underwriter was?

Thats ok, thanks for trying to help! I applied for the mortgage with Chase, I dont have any information on the underwriter I know they have their own dept, but they sent me a letter saying they based their decision on information obtained from Data Facts.

Re: Recently denied a mortgage, in need of some tips

maliblue34 — Tue, 19 Jun 2012 18:40:05 GMT

@scmami wrote:
When was DellFS charged off and what are the positives on your credit? I don't think they will move it to the mortgage board....it's a rebuilding question.

For the Dell account my TU report says
Balance: $1,507
Date Updated: 05/31/2012
High Balance: $2,796
Credit Limit: $2,000
Past Due: > $1,507 <
Last Payment: 05/11/2011
Pay Status: >Charged Off<
Account Type: Revolving Account
Responsibility: Individual Account
Date Opened: 04/18/2008
Date Closed: 02/15/2011
Loan Type: CHARGE ACCOUNT
Remark: >TRANSFERRED TO RECOVERY<

Re: Recently denied a mortgage, in need of some tips

JohnPTEX — Tue, 19 Jun 2012 18:41:42 GMT

Yeah I use Chase as my bank, but I feel there is absolutely no personalization with their credit determinations

Re: Recently denied a mortgage, in need of some tips

scmami — Tue, 19 Jun 2012 19:48:47 GMT

Your charge off is pretty recent... I know that hurts. Did you mention what is current and positive on your credit? The negatives could be overlooked by some lenders if you have strong positives. If you are still looking to purchase a home, try FGMC. They are a national lender who can do FHA starting at 580 and if you do a search on this board ,you'll find some great success stories from members of the MyFico family about this company.

Re: Recently denied a mortgage, in need of some tips

AZHeather — Tue, 19 Jun 2012 20:24:24 GMT

Do you have any other credit (i.e. auto loan, credit cards, charge cards, personal loans)? If so, have you been late on them? If so, how recently? If not, it may be your lack of credit that is really hurting you. After a BK, banks like to see that you are in "recovery" mode for a couple years, and successful at it.

Additionally, some banks want all collections or charge offs paid. So, that Dell charge off could be a factor - even with the letter of explanation.

As another poster said above - even though you are qualified for FHA, they still have to send your files out to lenders and each of those lenders have their own sets of criteria. Have you spoke with your LO to ask specific questions about why you were denied? That would be the first thing I would do.

Re: Recently denied a mortgage, in need of some tips

maliblue34 — Tue, 19 Jun 2012 20:30:55 GMT

@scmami wrote:
Your charge off is pretty recent... I know that hurts. Did you mention what is current and positive on your credit? The negatives could be overlooked by some lenders if you have strong positives. If you are still looking to purchase a home, try FGMC. They are a national lender who can do FHA starting at 580 and if you do a search on this board ,you'll find some great success stories from members of the MyFico family about this company.

That 5/31/12 was just updated for Dell, I dont know what they did, everything looks the same. Ive been contacted by the Collections Agency "Valentine & Kerbartas". Ive read some bad stuff about them. I called and asked them for payment arrangements, however the amount they are claiming I owe is about double than what is on my credit report. They stated I was probably not looking at the same report as them. Then I asked for something in writing which I havent received. They also wanted to choose an agreement by the close of business day (this was a few weeks ago) I havent contacted them back ever since.

I have 4 postive accounts accounts

1 Credit card with a $100 balance opened 2006

1 dept store account with a 0 balance opened in 2009

2 Sallie Mae Loans

Thanks for the info on FGMC I will look into them, Im just scared that applying for another mortgage will drop my score since its been past the intiial 30days they give you to"shop around"

Re: Recently denied a mortgage, in need of some tips

maliblue34 — Tue, 19 Jun 2012 20:51:41 GMT

@AZHeather wrote:
Do you have any other credit (i.e. auto loan, credit cards, charge cards, personal loans)? If so, have you been late on them? If so, how recently? If not, it may be your lack of credit that is really hurting you. After a BK, banks like to see that you are in "recovery" mode for a couple years, and successful at it.

Additionally, some banks want all collections or charge offs paid. So, that Dell charge off could be a factor - even with the letter of explanation.

As another poster said above - even though you are qualified for FHA, they still have to send your files out to lenders and each of those lenders have their own sets of criteria. Have you spoke with your LO to ask specific questions about why you were denied? That would be the first thing I would do.

The items showing up as late would be the 30 day HSBC payment I mentioned earlier., and the Student loans. What do you mean by they have to send my files to other lenders? I called Chase directly for a mortgage and they “pre-qualified” me for the FHA.

The LO really kind of sucked, and didn’t seem to know what he was doing… horrible at returning calls . I kind of felt I should’ve asked to work with someone else, but I didn’t. As soon as he called me and told me the news I asked why, but he wasn’t specific enough. I asked if I would get a letter, explaining…h said yes. The letter wasn’t really specific either..smh. But I guess its everything I put in my LOX, (which is what I stated in my OP)