Mortgage Journey

[AlphaKenny]

I wanted to post my timeline and ask some questions since of course I come up with questions after I meet/talk with my broker and real estate agent.

Here's my timeline so far:

Jan 22nd: Broker pulls credit (680 mid score)

Jan 26th: Receive pre-approval letter for up to 450k

Feb 20th: Go to a few open houses and find a beautiful townhome I want to put in an offer on.

Feb 21st: Meet with agent to submit an offer.  Asking price was $349900.  My agent advises me that the sellers have 2 other offers (1 below asking, 1 above asking).  The sellers also want a fast close.  So my agent gets on the phone with my broker and asks if she can get me closed by March 18th.  She says yes.  My agent thinks $352800 with contingencies lifted after 14 days (loan approval, inspection, appraisal) is a good offer so I sign the contract and ask to hear back by 9pm.

OFFER ACCEPTED!...with one counter offer condition: The sellers want 3 extra days after closing (rent free) to move out.  I accept and sign the counter offer.

Feb 25th: I met with the broker to sign the loan app and go over the numbers.  I am using a Conventional loan with 5% down.  I locked the rate in at 4.125%. I expressed concern about my approval because I have a few paid collections from 2010-11 that I recently paid off and she said I have nothing to be worried about.  I also have 3 Charge-offs from 2010-11.  She was submitting the paperwork to the loan processor (different from underwriter?) and I should hear back on Monday Feb 29th.  Then she will order the appraisal.

Feb 27th: Inspection completed (everything looks great according to the inspector).  I'm meeting with my agent March 2nd to go over the final inspection results.

Mar 1st: Underwriter came back with conditional loan approval!  Conditions seem easy (updated statements, paystubs, 2015 W-2, gift letter, hazard insurance quote, bank transaction history showing earnest money deposit cleared my account).

Mar 2nd: Met with my agent to go over inspection report and sign some title paperwork.  Lender also emailed me saying the appraisal is scheduled for March 7th.  I let them know contingencies were supposed to be lifted March 6th so the appraisal is a little late.  She was going to let my agent know so she could write up an addendum if needed.  Apparently the seller's agent works exclusively with the lender I'm using so she doesn't think it will be a problem to get an extension.

So does all of this sound normal? Does my rate seem ok with my numbers?

Any questions or comments are greatly appreciated!  Everything is moving so fast right now and I'm a little nervous as I don't want to lose this house.

[Imperfectfuture]

That rate is good for conventional and your scores. You can always refinance if rates are lower in four years or so (I like the four year time frame personally, or five years, you show great payment history, and the fates be willing, no more lates).

Just be sure the PITI and other stuff is easily affordable.

[AlphaKenny]

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@Imperfectfuture wrote:
That rate is good for conventional and your scores. You can always refinance if rates are lower in four years or so (I like the four year time frame personally, or five years, you show great payment history, and the fates be willing, no more lates).

Just be sure the PITI and other stuff is easily affordable.

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My reports will be clean in 2 years, so I should be in a good position to refinance if/when the rates and market cooperate.  There's not much else I can do to improve my scores right now except let the bad stuff age off.  Although my mid score did go up to 691 a little after they pulled my reports.  I paid down my 1 card that had a balance from 14% to 4%.  My broker told me 680 to 691 doesn't really make a differece in the rate so she didn't want to do another pull.

[AlphaKenny]

I updated my original post with March activities.  Anyone have any insight on everything?  It seems to be going way too smooth right now.

[trnl2016]

I have no insight, but I just want to say thanks for sharing your detailed timeline and story. This gives me hope, as I'm currently rebuilding my credit to be able to get a mortgage in the next year or two. I have 2 collections and 2 charge offs from around 2010 as well, but am working on getting those resolved before we look to get a mortgage. Thanks again.

[GirlMelanie89]

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@trnl2016 wrote:
I have no insight, but I just want to say thanks for sharing your detailed timeline and story. This gives me hope, as I'm currently rebuilding my credit to be able to get a mortgage in the next year or two. I have 2 collections and 2 charge offs from around 2010 as well, but am working on getting those resolved before we look to get a mortgage. Thanks again.

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Hi! Quick question! If youre not going to apply for a mortgage loan for anither year or two, wont your charge offs and collections fall off in 2017 anyway? 

[trnl2016]

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@GirlMelanie89 wrote:

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@trnl2016 wrote:
I have no insight, but I just want to say thanks for sharing your detailed timeline and story. This gives me hope, as I'm currently rebuilding my credit to be able to get a mortgage in the next year or two. I have 2 collections and 2 charge offs from around 2010 as well, but am working on getting those resolved before we look to get a mortgage. Thanks again.

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Hi! Quick question! If youre not going to apply for a mortgage loan for anither year or two, wont your charge offs and collections fall off in 2017 anyway? 

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Good question! Actually I was off by a year, 2011... but yes, they are due to age off in 2018. The biggest thing holding me back from a mortgage NOW is lack of down payment. Therefore, I want to resolve these issues ASAP in the event I win the lottery (ha, or something more relastic) that would allow me to purchase a house sooner than 2018.

[GirlMelanie89]

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@trnl2016 wrote:

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@GirlMelanie89 wrote:

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@trnl2016 wrote:
I have no insight, but I just want to say thanks for sharing your detailed timeline and story. This gives me hope, as I'm currently rebuilding my credit to be able to get a mortgage in the next year or two. I have 2 collections and 2 charge offs from around 2010 as well, but am working on getting those resolved before we look to get a mortgage. Thanks again.

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Hi! Quick question! If youre not going to apply for a mortgage loan for anither year or two, wont your charge offs and collections fall off in 2017 anyway? 

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Good question! Actually I was off by a year, 2011... but yes, they are due to age off in 2018. The biggest thing holding me back from a mortgage NOW is lack of down payment. Therefore, I want to resolve these issues ASAP in the event I win the lottery (ha, or something more relastic) that would allow me to purchase a house sooner than 2018.

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Have you looked into any programs that dont require down payments and offer no PMI? For instance, my credit union offers a First Time Homebuyer program with no down payment and no PMI, but you have to have a 640 credit score. If I had the score, I would do that! But if youre patient, (unlike me), you could wait.  You have to do whats best for you! But Im sure you know that. 

[AlphaKenny]

So, I haven't updated since March 2nd......I am officially a homeowner!!!  It was such a smooth process for me, I can't believe it.  I think it just felt that way because of all the reading and help I have gotten from this forum.  I was prepared for the worst, yet it never really happened thank god.

The only hiccup happened on the day I was supposed to meet with my lender and notary (March 15th).  I got a call about an hour before our appointment asking if I could come in a little later.  Unfortunately, I couldn't meet later so my lender fessed up and said she didn't have the paperwork ready because there was an error on their part.  She told me to come in anyway to meet the notary and hope that escrow could get the paperwork to us before I had to leave.  The paperwork didn't make it in time so they scheduled the notary to meet at my house later that evening, which they did.

It turns out that the error was because my closing costs exceeded the 3% maximum allowed?  This was due to me buying out my PMI upfront.  I guess they didn't catch it earlier in the process and I had already received my closing disclosure so they were on the hook for the difference.  That meant that I had to pay $3782 LESS than originally thought.  Good for me!!

So all went well and I got the call yesterday that the loan was funded and the house is mine!  And more good news that I am getting another 2k back AND I can cancel my hazard insurance because it is included in my HOA!

Not too bad I think for a 680 middle score with 3 charge-offs and 2 paid collections.

Any questions, please feel free to ask.