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Pre-Approval Process Soon - Questions

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Pre-Approval Process Soon - Questions

I will be 14 months post BR13 when we pull the trigger for pre-approval.  I am worried about that as well as just overall approval odds.

 

Numbers:

 

Mid Mortgage score = 695, which I suspect will be over 700 within a month

BR Discharge December 2015

BR13 payments all made on time, and even paid off a year early

 

Once BR was discharged received info that I still owed interest on student loans (immediately applied with Navient and started paying those): have back up documentation on this. No lates reported except way back in 2010 and 2011 right prior to BR; LONG time ago; about to age off PLUS these were paid off through BR.  Tried having them removed but they wouldnt take them off *sad face*

 

THEN one of the Student Loan holders that never agreed to be paid through BR (which I didnt know) filed for their money as soon as they knew the BR was discharged.  Imagine my shock becaues I thought everyone had been paid!!!!  In the midst of dealing with them they started reporting me as late, even though I was trying to combine this amount with the amount I was already paying Navient.  Sucess!  They are paid off and now paying Navient.  However the lates in early 2016 are still there.  They show up on if I remember correctly, only 1 of the 3 reporting.  I have opened a dispute.

 

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Anyway, I have the loan with Navient ($50 a month) and my loan on car $263 a month (2 years paid every month; excellent rating)

Credit cards revolving: reporting <1%    (perfect payments)

I havent applied for any new credit since late September (went on a card spree Aug-Sept to get credit to improve credit for the sole purpose of buying a house)

 

Cash on hand: $32K (checking and savings)

IRAs: $25K (also with my bank)

401K: $60K

 

I have already talked to 2 lenders for a pre-qual discussion so they know my situation.  Gave me my ballpark number which I kinda knew already. 

 

Am I setting myself up for rejection here???  I was going to wait until Summer to get started for a bit more aging, but they didnt think it would make a difference.

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Re: Pre-Approval Process Soon - Questions

Because it'll be less than 2 years from Ch 13 BK discharge, if you are planning on going FHA, it'll be manually underwritten.  When manually underwritten, FHA guidelines state:

  • The underwriter may consider a Borrower to have an acceptable payment history if the Borrower has made all housing and installment debt payments on time for the previous 12 months and has no more than two 30-Day late Mortgage Payments or installment payments in the previous 24 months. 
  • The underwriter may approve the Borrower with an acceptable payment history if the Borrower has no major derogatory credit on revolving accounts in the previous 12 months.
    • Major derogatory credit on revolving accounts must include any payments made more than 90 Days after the due date, or three or more payments more than 60 Days after the due date.

 

So I don't see where you indicated how many late payments were reported, but if there were more than two 30-day late payments in the last 24 months then it wouldn't be possible to approve. 

 

How many late payments are reporting?

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Message 2 of 16
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Re: Pre-Approval Process Soon - Questions

Equifax shows 3.   The other 2 show none.

Message 3 of 16
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Re: Pre-Approval Process Soon - Questions

In reading your statement, this wasnt an installment loan.  They sat on that amount until they knew my BR was discharged and then came after me.  How can they mark it as late immediately post DC?  That just doesnt seem fair.  Not when I did everything right, including working with them, and almost paying them off in a lump sum (which now I guess I should have) because while I was obtaining the loan with Navient they kept marking me as late. 

 

Again just doesnt seem fair.

 

So are you saying its just not going to happen and I need to wait until 2 years post DC (Dec) to go conventional?  Or do I have ANY chance here????

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Re: Pre-Approval Process Soon - Questions

Student loan is considered an installment loan.  On a credit report the types of tradelines are:  mortgage, installment, revolving, and open (like an AMEX, but most underwriters still consider open account as revolving).

 

I'm not sure how they can report it late right after the BK discharge, I agree it's unfair, but something you should probably ask one of the two subsections of Bouncing Back from Credit Problems.

 

As long as there are more than two 30-day lates on installment accounts in the past 24 months, you are dead in the water for FHA manually underwritten.  I'd beg, plead, grovel for them to remove one of the late payments... then you'd be back in the running for FHA.

Helping people with mortgages (FHA, VA, USDA, Fannie, Freddie, Non-Prime, Construction, Renovation/Rehab, Commercial) since 2002
Located in Orange County, CA and lending in all 50 states
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Re: Pre-Approval Process Soon - Questions

Yeah as soon as I get done with my day today, or at the very least, I will call Monday and do just that.  Beg and grovel.

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Re: Pre-Approval Process Soon - Questions

A lot of people report that student loan lates are tough to get removed, but I've had several clients who have had luck.  Persistence is key.

Helping people with mortgages (FHA, VA, USDA, Fannie, Freddie, Non-Prime, Construction, Renovation/Rehab, Commercial) since 2002
Located in Orange County, CA and lending in all 50 states
Message 7 of 16
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Re: Pre-Approval Process Soon - Questions

So I just got off the phone with a very nice lady!  She told me that it should NOT be showing as lates for that period of time as they do NOT report lates.  I said well its showing here on one of the bureaus.  So she waited while I found exactly where it was, what months it was showing and she is submitting an EUD to the bureau!!  She said it takes about 3 days, and then whatever time Equifax takes but I think this might WORK!!!!  At least i have the documentation!!!  AND if i can get a letter from them would that help in case EQ takes too long?  Again it SHOULD be updated I would think by the end of Feb right????

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Re: Pre-Approval Process Soon - Questions

Nice going!  You might want to try your luck in Vegas next. 

 

Yup, if they submitted an AUD (I believe that is what it's called, for Automated Universal Dataform) then it should be updated within a few days.  You can always get a letter from the creditor that says the lates have been deleted and then a lender can do a rapid rescore for you.

 

Things are looking up!

Helping people with mortgages (FHA, VA, USDA, Fannie, Freddie, Non-Prime, Construction, Renovation/Rehab, Commercial) since 2002
Located in Orange County, CA and lending in all 50 states
Message 9 of 16
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Re: Pre-Approval Process Soon - Questions

I have an open dispute with bureau for this already; I might call them next week to find a status (online just says ETA Feb 3 for resolution).

 

This info might help if they know its coming. 

 

Hey thanks a lot !!!!!   Sooooooooooo knowing thats going to be resolved the rest looks OK?

Message 10 of 16
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