We have been in contract over 60 days now, with our closing having been postponed three times now due to conditions that UW keeps throwing at us. We have satisfied each of their requests (paystub copies, copy of gift check for downpayment for FHA loan, copy of builder's license, I literally could go on and on). My question is, do I need to find another lender at this stage of the game? My realtor is pushing me to take our file elsewhere (a local mortgage broker in our small town) and she is a dual agent in this deal. We have satisfied every condition that UW sends to us within a couple of hours, but every day I hear that they are still reviewing it, and then next thing we know, here comes another request. We are out of contract dates as of tomorrow, and still no clear to close. I know our scores are fine for fha, and the front end ratio is great, but backend is close to 48%. Is there any hope of actually getting this closed? My loan officer got testy with me and said no other lending would touch this loan. Is she full of it? I hate to think that we are not going to get our house, and hate it even more than we stand to lose $2k at this point in earnest money and appraisal fee!
I think the backend ratio may be what's causing problems. They are probably trying to prove that you can financially handle the mortgage on top of your other debts. I was going to go for an FHA loan as well, but the DTI ratios were too restrictive (even though I have little debt, plenty of income, and cash reserves).
I'm right there with you although we haven't had to push back closing yet. Our backend ratio is even higher. Our problem is that my husband's credit score dropped below what was in the conditions of the loan (old baddie came up from 5 years ago, that we didn't even know about). We have to do 5% vs 3.5% (which we didn't have the difference, so had to ask family for the extra), take a higher interest rate (4.25%) and try to count my self employment income from what i make NOW (not averaged over last two years). It's very frustrating! Hoping to hear something today. Good luck!
I was in your situation too back in December. My lender gave me conditional approval like immediately then the UW had major issues about land use. After I questioned the UW, i get from the lender, "NOONE will touch this loan for you, we are your only hope", "we are willing to do whatever it takes to get your this loan", "we will stick with you". I eventually went with another lender. Pushed me back a few weeks but I never really knew what was going to happen with the UW from day to day. My advice is to go out and apply with another lender. I went FHA and my back end I think ended up being close to 45%. My second lender was a breeze, didn't work as fast as I wanted but I guess it is a give and take situation.
Just shop around, you have that right. Good luck!
We were in a similiar situation and ultimately switched lenders. I know its frustrating but if your realtor is seasoned they maybe be smelling a dead end. It doesn't hurt to let another lender look at your situation by now you should have received a copy of your credit report and scores. Most lenders shold be able to take that info and give a good solid answer. It took 2 weeks to close after changing lenders so it can go pretty fast especially since you have all your documentation ready to go.
I guess that's why I've read that preapproval letters are worth about as much as the paper they are written on. Good Luck!
i think there is a mass epidemic of underwriters getting hooked on crack..... or something.
caused me to change banks
Thanks ya'll! We FINALLY got the clear to close around 2pm today....this morning I had talked to the lender here in my town (direct lender by the way), who just based on what I told her regarding the loan, said she could actually go as high as 53% on the back end ratio, and didn't see any trouble with getting this closed in about two weeks or so since most of the documentation would be readily availalble. I told this lender that if we didnt have a closing scheduled by tomorrow I would be pulling the file and sending it her way. It made me feel good to at least know that I had a back up plan available just in case. Anyway, closing tomorrow afternoon and I couldnt be more relieved. To all ya'll out there in the same boat, I suggest that you at least run your scenario past another lender (without pulling scores of course), if for nothing more than your own peace of mind. Just knowing I had options this morning made the rest of my day soooo much more relaxed!