We're Pre-approved - Still Worried - Can't Sleep!

[xecutech]

Ok, we finally got the tax liens off of all of our credit reports and we are looking at purchasing a house for $240,000. Our lowest middle fico score was 684, so we were told that we are pre-approved for conventional at 5%. We have $20k for 5% down and closing costs. My scores were ex713, eq667 and tu696. My wife came in at ex770, eq664 and tu684. Our yearly income is $109k per year, DTI is 10% before we add the house payment. Our credit cards are at 10k with only a $300 balance on one of them. She has student loans and never missed a payment.

We are on a payment plan with the IRS and those payments are in the DTI above.

The part that is keeping me up tonight is the loan officer gave me a strange look when I told her to pryer to my new job of 9 months, that I was out of work for about 15 months after being laid off at a company I worked at for 3 years. There is 1 dispute comment on my wife's report that was supposed to be off, so we have to call them Monday to remove it, but for some reason I feel like underwriting may decline us. Also, there was 2 30 day lates on her report from 2 years ago, but that account is paid off now.

Our copy of the credit reports have zero balances on the 4 collections. I have a paid judgement from over a year ago. I just left the meeting feeling very worried. I guess we could fall back on an fha loan if they decide we cant go conventional.

I apologize for the long rant. Just worried and would love some feedback. We have had bad credit for so long, that I guess I still feel like we do. Old habit.

By the way we started out in the low 500s 6 months ago, so we worked very hard to get to where we are now.

Ok, so let's hear your opinions.

[BrianB_The_Loan_Professor]

The job Gap will be a red flag for an underwriter - they will want to know what happened - you will need to draft a clear and concise explanation

You have more than 6 months on the new job so you should be fine - if you can get someone to document that your long term chances for employment are good it will strengthen your case -

I wouldnt lose sleep over it - it is what it is

as long as the rest of the file is strong I dont see you having any issues

Good luck

Brian

[xecutech]

Thank you Brian. I was still restless and was glad to see your reply.

If we couldn't go conventional, would the job gap keep us from going fha as a last resort? We are making an offer on our house in the morning.

[Peter1142]

If you can document the work history for the job you were at 3 years (including IRS tax transcripts), then you should be fine. Just prepared to deal with a lot of underwriting requests...

[xecutech]

Well, the mortgage company gave us a pre-approval letter today when we made our first offer on the house we picked out. They sent the offer at 4pm and we are still waiting on an answer 4 hours later. Hope that that's a good sign they are considering it.

Thank you all for the feedback. I was told to have my w2s, tax docs and etc ready for when uw requests it.

[xecutech]

Our offer was accepted and they also agreed to pay our closing costs. We are very excited, but still a little nervous dealing with the under writers.

Hopefully, we will be clear to close soon.

[Down_2Bizness]

Hope everything works out for you!

[Peter1142]

Good luck! Make sure you have a good mortgage contingency in the contract just in case.