USDA Direct loan - NC - 2016

[amthystwlf]

Spoke with the USDA rep today. They pulled an EQ mortgage last week and she said my score was a 686. I had not expected that huge a jump from deletions. 

Bad news is that with my income, even with no other debt, the most she thinks I could qualify for would be around $45K. Now I know that with a 686 I could get a waiver since I can show I've paid $550 month for rent/power combined for over 2 yrs with no assistance. However, I need to get my debt paid down more and get the car out of my name. She went ahead and sent me the application so I could see what kind of docs I might need to provide. Like I told her, if they want a couple months bank statements or something, by knowing now, I can start to save all that info.

My brother needs a babysitter and he offered to let me come stay with him, in exchange for being the adult there while he & his wife work 3rd shift. They know someone with a property with a house and a trailer and that person has suggested to them before that they buy it. So what we are considering is that I move in with them for 6 months-1 yr. I could get all my debt paid down in that time frame. Then we go and buy that place and separate the trailer off for me. They just started new jobs - better pay except they need the reliable over night care. That would give them time to get things worked out with their credit and pay off what little debt they have while they establish enough time on the job.

I'm seriously considering it because the USDA rep said they didn't know if I could find a place in this area that I could afford that would meet their inspection guidelines.

[amthystwlf]

Broke down and pulled new FICO's on 2/25. My actual mortgage scores:

EQ - 620 >>> 686

EX - 574 >>> 696

TU - 635 >>> 704

85 point average increase but my worst score went up 122 points in 6 months time.

The car is still in my name because the title has not got back to the bank from Raleigh. The CU won't refinance to remove me from the loan until they get the title back. But the CU claims they have called DMV to find out why the title has not bent sent back to the CU. However, once they get the title back, they will give me a letter confirming the refinance. 

Currently, my other DTI is 23% Of that, about 40% of that will be paid off shortly. I helped someone fix a car when it needed repaired and they are paying that CC bill down fast. Of the remaining $820, I have min pay on 3 cards totaling $75 month. 

[amthystwlf]

My countdown has begun. Turned in my app today with all the standard stuff, plus 2+ yrs of $400 month rent receipts, a homebuyer education certificate and info on a USDA home headed for foreclosure mid-March. I also took photos of the place I currently live in showing the substandard conditions. The rep at the USDA office (not the mortgage officer) asked me to email them to her. She took my file, said she will review it and then send it on to the loan officer. 

If I qualify, I should move up quick for approval. Reason # 1 - substandard housing. Reason # 2 - inadequate heating. Reason # 3 - interested in buying a USDA property that is already headed for foreclosure.

Another plus is that since it is a USDA home, an appraisal is not required.

I thought about waiting to apply until I got my debt paid down more but my brother looked over the possible foreclosure and told me I should go for it now. Home is less than 1/2 mile from bank, groc, pharmacy and a general retailer store. Plus less than 2 miles from family and on their way home from work.

[amthystwlf]

Finally got a call from USDA. Turns out they need even more info. 

1. I do a small amount of self employment, my biggest expense is mileage. I gross around $100 per month but net $35. It is reported on my taxes but she's not happy with just having the Sch C, she wants copies of my 1099's. Only 1 company I work thru sent me a 1099 because they were the only one that I earned over $600 for the year. I emailed that 1099 and explained I didn't receive one from the other companies (one company was a whole $20 for a single mystery shop) because I did not make $600. Also told her that I had contacted the other companies to see if they could at least email me a 1099 but that I was attaching my pay records until then. Hope she accepts the pay records because they do gives the dates and the company I contract through.

2. She needs a copy of my divorce papers. I can't find them (figures). Luckily, I have a friend in the city where my divorce was done who is gonna try go get a copy for me. She'll scan it and email it to me.

3. She was concerned about a car loan I had been a co-signer on. The other party made all payments but it had been less than 1 yr since it was refinanced to our credit union from Chrysler Capital. They said it had to be 1 yr on the current loan of other party making payments to exclude the debt. Other party solved that by going to the CU, we explained the situation, and the CU refinanced the car loan to take me off the debt and title. Gave me a paper showing it in the new owners name alone & biz card so USDA could contact them if they needed a letter or anything. So good to go there.

4. She didn't say anything but I know I need to continue paying down my debts. All extra money is going to that. Already trying to downsize in order to move and selling stuff online, using proceeds to pay down debts. Currently sit at 18%.

[amthystwlf]

Got my divorce papers emailed to USDA office on 18th, along with 1099 from 2 companies. Only 1 was over $600 in income but the other company sent me one upon request. The other 2 companies pay an outside company to send out 1099 and will not send me one at all.

As of 3/20, CK still doesn't show a mortgage pull. Wish they'd go ahead and pull it, I want to put the freeze back on my reports.

Not sure what date USDA will consider my file complete? Is it from when I turned it in or when they have everything they request? If the former, then my 30 days is up April 5, assuming the count starts the following business day from submission. If the latter, then it won't be over until April 19, again assuming it starts the first business day.

The little house that was going into foreclosure with USDA was taken back by USDA on 3/18 for just under $23,000. There is a 10 day upset bid period which ends on 3/28 so on 3/29 I can call and see if any upset bids were registered. I really like the location of this house and it being a block house is a huge bonus. Its an older home and on the small side to be 3 beds but within 1/2 mile of most shopping. From what we can see from the outside, the biggest issue is cleanup and I think one window was cracked on the outer pane but not the inner pane. The storm door is also missing on the carport but it's covered so not a big issue there either. 

Hoping my 30 days goes quickly cause I really want to look into this little house first. With everything on the market right now, it fits my needs the best but I do have a couple others I can look into if this one isn't for me. I check our MLS about twice per week, just browsing and if needed, add a new listing to my "possibilities" list and figure out where it ranks based on my needs.

ETA: Once my pending payments on CC clear, I will be down to 14% DTI - only my LOC & 2 CC left. The LOC alone puts me at about 9% DTI so I'd be happy just to get my CC paid off before I get to closing.

[Anonymous]

I got my Certificate of Eligibility exactly 30 days from when they received ALL paperwork. From what I was reading in the manual the file is not complete until they have everything they need. Make sure to call or email the area specialist you are working with (email always gets me the fastest response) because sometimes they don't tell you about things they need right away.

[Imperfectfuture]

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@Anonymous wrote:

I got my Certificate of Eligibility exactly 30 days from when they received ALL paperwork. From what I was reading in the manual the file is not complete until they have everything they need. Make sure to call or email the area specialist you are working with (email always gets me the fastest response) because sometimes they don't tell you about things they need right away.

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@They do not consider my file complete until they have the Section 8 hap amount from Lincoln County, and even these guys are disagreeing on the type of voucher.  But, the lady handling the port is not in until tomorrow.  Like @amthystwlf, they have not pulled credit.  On the upside, TU just went to 805.    Gardening has pay offs.  (PS, that is not my mortgage score).

[amthystwlf]

The 2 cards I recently paid off FINALLY updated the balances on the website. Printed the main page showing my current balances at $0 and emailed those off to the USDA office. That cuts my DTI down to about 14%. Get 1 more card paid off & I will be 11.8% DTI if they don't allow my SE income & 11.4% if they do allow the SE income. 

My only concern with the SE income is that she wanted 1099 forms. But I only made over $600 with 1 company so that was the only 1 to send a 1099. Another sent it when I asked. The other 2 won't send it because they pay an outside company to process payments to contractors, including tax forms. And they won't pay to have a tax form prepared unless it is required by law - $600 or more in payments. 

Also concerned she plans to count my son and put a student deduction for him. He lives with me now but he is moving away. A 1 bedroom that is basically a tiny home (under 500 sq ft) just went on the market & it would be great for me. I can't stand the horrible conditions of this place any longer and I am in the process of moving out now to stay with my brother. I will be staying in a 4 bed house with 4 adults(including me), 4 kids all the time plus my brother has 2 boys he gets every other week. One of the other adults sleeps in the den, I will be sleeping in the kid's play area in basement. It has carpet and a couch so I can deal with that for a couple months. And I would still get a higher priority because of the over crowding - more than 2 people per bedroom.

[Imperfectfuture]

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@amthystwlf wrote:

The 2 cards I recently paid off FINALLY updated the balances on the website. Printed the main page showing my current balances at $0 and emailed those off to the USDA office. That cuts my DTI down to about 14%. Get 1 more card paid off & I will be 11.8% DTI if they don't allow my SE income & 11.4% if they do allow the SE income. 

My only concern with the SE income is that she wanted 1099 forms. But I only made over $600 with 1 company so that was the only 1 to send a 1099. Another sent it when I asked. The other 2 won't send it because they pay an outside company to process payments to contractors, including tax forms. And they won't pay to have a tax form prepared unless it is required by law - $600 or more in payments. 

Also concerned she plans to count my son and put a student deduction for him. He lives with me now but he is moving away. A 1 bedroom that is basically a tiny home (under 500 sq ft) just went on the market & it would be great for me. I can't stand the horrible conditions of this place any longer and I am in the process of moving out now to stay with my brother. I will be staying in a 4 bed house with 4 adults(including me), 4 kids all the time plus my brother has 2 boys he gets every other week. One of the other adults sleeps in the den, I will be sleeping in the kid's play area in basement. It has carpet and a couch so I can deal with that for a couple months. And I would still get a higher priority because of the over crowding - more than 2 people per bedroom.

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Priority does not matter unless they run out of money.  For SE income, I provided profit loss, that is all they need.  I do not think any of my clients did a 1099.  On the up side, most of my deposits were vis remote, so I have a copy of all checks.  PS, they paid well over 3x 600.  Just not sure they are familiar with tax law.

[amthystwlf]

I had my Sch C on my 2015 tax forms. She still said she wanted to see my 1099. Maybe in this area people claim fake income or something to get EIC. I got a whole $33 back off my return, lol. I told her it was on my tax forms and everything, then she wanted to know what I did for SE so I had to explain merchandising to her. She seemed like she didn't believe I got paid to go to Walmart and inflate balloons but somebody does it, right? I mean, they don't magically inflate themselves. That was the company that did issue me a 1099 anyways, not one I had to request.

Maybe she is just very unfamiliar with non-traditional types of SE. Most people are here have jobs like child care or taxes or beauty salons as SE.....Who knows but $35 month net isn't gonna kill me if they don't allow it.