DTI/Dispute

[Anonymous]

Yesterday I received a call from my LO from Chase regarding our file. Apparently all was well except that on my fiance's credit report he had two items with dispute comments. Both items have a zero balance and since our initial credit report was pulled, both comments have been removed.

Currently our DTI was 48% but the LO states that because of these comments the UW refuses to accept anything else but a DTI of 43%. Can someone please clarify this? What does one have to do with the other? I'm feeling so hopeless...

[JM-AM]

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@Anonymous wrote:

Yesterday I received a call from my LO from Chase regarding our file. Apparently all was well except that on my fiance's credit report he had two items with dispute comments. Both items have a zero balance and since our initial credit report was pulled, both comments have been removed.

Currently our DTI was 48% but the LO states that because of these comments the UW refuses to accept anything else but a DTI of 43%. Can someone please clarify this? What does one have to do with the other? I'm feeling so hopeless...

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This is common when have items in dispute on your credit reports. The easiest way at this point really is to bring down your DTI or try another lender since the comments are no longer there on your credit reports.

[ShanetheMortgageMan]

Your loan officer just needs to pull a new credit report without the comments.

[Anonymous]

Thanks Shane. My LO says he can't do that and I'm starting to feel really hopeless here since it's on just my fiance's report, can they just run his again?

[ShanetheMortgageMan]

Isn't that what I suggested, to run the credit again?  Perhaps we are not talking about the same thing.

[Anonymous]

What I mean is can they run just his instead of his and mine? I just don't understand why he refuses to run it at all.

[ShanetheMortgageMan]

They should be able to - as you aren't married so you would have a separate credit report run on each of you.  You only have a joint credit report when you are married.  I don't understand why he refuses to do it at all either, perhaps their FHA loan program have some heavy overlay guidelines.  The reason they are implementing lower debt ratio is that FHA says the loan needs to be manually downgraded when there are disputes on accounts, but FHA recently clarified that they do not require a manual downgrade if the disputed account has a zero balance or the credit report indicates the disputed account is “paid in full” or “resolved” or the disputed account is less than $500 and more than 24 months old. 

[Anonymous]

Thanks Shane. So even though FHA clarified their requirement, Chase can have their own overlay guidelines regarding this?

[ShanetheMortgageMan]

Yes they can, but I would bring it up to them, some underwriters don't keep up with the current guideline changes.

[Anonymous]

Ok will do, thanks Shane