USDA Direct Loan Question?

[SuzyStellar]

I opened my mail today and almost fell over!  I got a letter from the USDA about our loan application.  It says our application has been selected for processing.  It also says we need to send in additional documents in order to determine our eligibility for loan services.  Does anyone know what this means?  Does it mean yayyyy we get a home, or just we are thinking about giving you the loan, or maybe does it mean we are good and they are going to give us the loan they just need these things to complete their work?  Some of those are the same thing I know, I am just frantic and can't even think straight right now I am so super excited! 

[Anonymous]

It means you passed the intial prequal (based on app info and credit report). Now they are going to go in depth to make a final determination. It means "we are thinking about giving you the loan". There may be conditions that have to be met, or something might pop up that didn't intially. It is stil up in the air.

But getting through that first hoop is promising and exciting!

Good luck!

[SuzyStellar]

Thanks so much for the response!  I am also wondering are they pulling another credit?  After I sent in the prequal app they called me and said they did pull credit and gave us scores.  Now they are pulling another after the full app has been submitted 2 weeks later....maybe 3 weeks.  Is this credit report just a bigger more in depth one?  Thank you, Thank you! 

[boomhower]

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@SuzyStellar wrote:

Thanks so much for the response!  I am also wondering are they pulling another credit?  After I sent in the prequal app they called me and said they did pull credit and gave us scores.  Now they are pulling another after the full app has been submitted 2 weeks later....maybe 3 weeks.  Is this credit report just a bigger more in depth one?  Thank you, Thank you! 

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If they pull another one it will be the same thing just updated to current information.  As long as they are within 45 days it wil only count as one inquiery on your score.

[wednesdayaddamsd]

Suzy,

When you sent in the prequal was it just a one page application? If that was what you filled out, then the USDA responded based only on your stated income to determine if you are eligible, along with only one credit score, your TU04 to determine if you were further eligible for processing.

If you appear to be "qualified" based on those two factors, then they will have you fill out the complete application (around 10 pages if I am remembering correctly) and they will pull a 3 bureau report via CBC Innovis. Yes, they will pull your TU04 score again. They told me they will use the score they get for the 2nd pull on the TU04 regardless of whether is is higher or lower.

It's very exciting to get through that first hoop. I hope you can go all the way! Good luck!

[wednesdayaddamsd]

oh, by the way, use the search function on this board to look up "macbookguy". He wrote a very, very long detailed description of his USDA Direct 502 process and it is really wonderful and informative. He would answer all of the questions that you currently have in his post because he was very, very detailed.

[SuzyStellar]

Thank you, that is what I was looking for.  Yes we submitted the 1 page prequal, and sent in the 10 page app.  I did talk to the person working on my application, while he was looking at it.  I told him I was worried, but so excited. He was very nice, and talked to me for a few minutes.  I asked him if the reports came up with negative things if we could just take care of them, and he said sure as long as they arent thousands of dollars.  Does that sound right?  He also asked for us to send in 3 open payment histories of things we pay every month for the last year ie; car insurance, cable, cell phone.  What will happen with those I wonder?