Mortgage Late Payments

[xtina13]

Hello! Looking for some guidance

Times 30/60/90+ days late: 4/2/2

1. Last missed payment February 2025

2. Had a baby in late 2024 and took a reduction in income for several months. 

2. Sold home April 2025 (not a short sale, made a small profit)

3. Relocated and currently renting with a lease ending May 2026.

4. New job with salary of $110k, $15k bonus. Employed since January 2025. 

5. Cash reserves between savings and retirement: ~$390,000

6. No other debts

7. Credit score of 740

8. Looking to purchase a new contruction home of about $600k-$650k

What is the best approach to be able to purchase a new home? Do I wait until March 1 to reach out to a lender? I don't want to reach out now, take a credit hard inquiry and be denied and try again so quickly.

[pizzadude]

This recent thread has some good information on qualification / loan types with late payments

[ShanetheMortgageMan]

Can you tell us which months were late and how many days late (30, 60, 90) those were?   I made a table below, you can copy/paste it into your response, and then put an "X" if that month was made on time, and then 30, 60 or 90 in whatever month/year those were in.   That'll help determine when you should apply.

Year | Jan | Feb | Mar | Apr | May | Jun | Jul | Aug | Sep | Oct | Nov | Dec

2024

2025

How much of that $390k did you want to still have after closing?

[xtina13]

Year | Jan | Feb | Mar | Apr | May | Jun | Jul | Aug | Sep | Oct | Nov | Dec

2024	X	90	60	30	X	X	X	X	X	30	30	30
2025	60	90	X	X	-	-	-	-	-	-	-	-

I would like to keep about half for a rainy day.

Appreciate the reply!

[xtina13]

Thank you!

[ShanetheMortgageMan]

Thank you, so in March 2026 you'll be 1x90, 2x60 and 4x30 in the last 24 months, which is approvable.  The fact that you can put down 20% will allow you options, even if you have to go with a Non-QM loan program. 

I would wait until March before applying and having your credit checked, as a 90-day late payment in the past 12 months will hurt your options if you have to use a Non-QM loan.   You'll also be less likely to get an automated underwriting approval for Fannie Mae or Freddie Mac (which is really what your goal would be).  FHA financing is another option to consider as well, but even with a 20% down payment you'll have to pay MIP each month (FHA's version of PMI) and with the mortgage payment history you'll need an automated underwriting approval for as well.  When the time comes, in order not waste time, you should work with a loan officer who you can run your loan through all 3 options, and I'd feel confident about getting approved for one of them.

Since you mentioned buying new construction, a lot of builders offer incentives tied to using their in-house lender, so make sure to ask about those.  

[xtina13]

@ShanetheMortgageMan thank you so much for the insight. I really appreciate it and plan to apply in March.