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Late payments and mortgage approval

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Anonymous
Not applicable

Late payments and mortgage approval

Hello all,

 

I am hoping to get some insight on mortgage approval odds. I have 3 30 day late payments on my report:

 

1 in 2/2020 - credit card 

1 in 5/2019 - credit card 

1 in 1/2015 - car payment 

 

I have tried goodwilling the first two and it's just not happening. Otherwise, I have nothing negative on my credit report. Current middle mortgage score is around a 680, but I expect it to go up next month as we paid off some credit cards. My question is, will I be able to qualify for a conventional loan if I have those three lates? The plan was to wait until March 2021, but now my husband might want to make a move sooner, but worried those three lates (especially that recent one) will hold us back.


Our combined income is about $186,000 with a DTI at 15%. We are looking for something in the range of $420-480k for the house. We have close to $30,000 in savings.

 

Thank you for the input!

 

10 REPLIES 10
VALoanMaster
Valued Contributor

Re: Late payments and mortgage approval

I think you have good chance of getting an automated underwriting system (AUS) approval. The late payment from 2015 doesn't matter and the late payment from 2019 is over a year old.

VA Mortgage Expert. Mortgage Banker lending in All 50 States.
VA, FHA, USDA. Jumbo, Conventional.
CAIVRS Expert.
Message 2 of 11
Anonymous
Not applicable

Re: Late payments and mortgage approval

@VALoanMaster thank you so much for responding! 

Message 3 of 11
JVille
Valued Contributor

Re: Late payments and mortgage approval

I agree with @VALoanMaster 

Message 4 of 11
Anonymous
Not applicable

Re: Late payments and mortgage approval

Hi there. Could you (anyone) send me a PM for the goodwill letter you used with cap one. Am also trying to get some late payments off I could use some assistance on wording of the letter.

Message 5 of 11
Anonymous
Not applicable

Re: Late payments and mortgage approval

@VALoanMaster , If I can ask, what kind of damage would 3 30-day lates from 2017 and one from January 2018 do? No other derogs on report. 

Message 6 of 11
VALoanMaster
Valued Contributor

Re: Late payments and mortgage approval


@Anonymous wrote:

@VALoanMaster , If I can ask, what kind of damage would 3 30-day lates from 2017 and one from January 2018 do? No other derogs on report. 


Hi @Anonymous,

 

Your lates are old enough that they won't matter.

VA Mortgage Expert. Mortgage Banker lending in All 50 States.
VA, FHA, USDA. Jumbo, Conventional.
CAIVRS Expert.
Message 7 of 11
Anonymous
Not applicable

Re: Late payments and mortgage approval

Thanks @VALoanMaster. I just pulled my mortgage scores at 600/604/614. The lates are reporting on all 3 accounts. I'd like to start shopping for pre-approvals in February 21 and I need to be approved for conventional in order to use my state's DP / CC assistance program. Right now they're asking for a 680.

Message 8 of 11
Anonymous
Not applicable

Re: Late payments and mortgage approval

@VALoanMaster May I ask a question?  I am applying for FHA.  My LO is preparing to send my file to underwriting and they are asking for letter of explanation for late payment/collection account.  I have one collection account on my report, is this what they are referring to? No late payments for 24 months. I sent an email to ask but of course its Sunday, so I thought I could ask here.  Also, I had to provide August statement and it shows how my savings has lowered, (I used some money to pay credit cards) will this be an issue?  Thanks in advance.

Message 9 of 11
VALoanMaster
Valued Contributor

Re: Late payments and mortgage approval


@Anonymous wrote:

@VALoanMaster May I ask a question?  I am applying for FHA.  My LO is preparing to send my file to underwriting and they are asking for letter of explanation for late payment/collection account.  I have one collection account on my report, is this what they are referring to? No late payments for 24 months. I sent an email to ask but of course its Sunday, so I thought I could ask here.  Also, I had to provide August statement and it shows how my savings has lowered, (I used some money to pay credit cards) will this be an issue?  Thanks in advance.


Hi, @Anonymous, 

The letter of explanation just needs to address the collection account. The reduced balance in your account could be an issue if it reduced the amount you have for the down payment or reserves.

VA Mortgage Expert. Mortgage Banker lending in All 50 States.
VA, FHA, USDA. Jumbo, Conventional.
CAIVRS Expert.
Message 10 of 11
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