Don't take this the wrong way, but if this was more than a 1 time thing, this may be a huge mistake for you to be buying a house. There is never a good reason for a NSF outside of bank error, a deposit being returned unknown to you, or maybe a emergency where you have to take funds out that were sent out for something else. Now I live paycheck to paycheck and have to struggle, so I understand. That said, if you are on the verge of bouncing checks on a regular basis, what are you going to do when a furnace goes down or something happens with the house that needs taken care of immediately. Also, what happens when it is the mortgage that bounces and by the time it is rectified you are 30 days late and your FICO score tanks.
I know this is not going to pursuade you to not buy a house, but maybe it will pursuade you to seriously re-think spending habits. If you are that close to the line on a regular basis (and we can only assume you are given the post) you need to either reduce spending, increase pay, or find some asset you get get rid of to give you some wiggle room. The bottome line is that if you don;t have at least 1 mortgage payment sitting in the bank, you should not be buying a house. And if you are bouncing checks then that is obviously not the case.
Now, I'll get off my high horse and answer the actual question.. Sorry to go off above, but it sounds like a recipe for disaster and I don;t think banks are going to be as forgiving with people who just bought and/or are buying in the near future as they are being to epople who bought a couple years ago.
As far as NSF, they want a documented reason for why you are bouncing checks or overdrawing your account. Be careful what you say because the underwriter may want documentation of it. If you say you got sick and missed work they may want paystubs to show the loss in pay or med bills or whatever...You get the point. What I do know, is that saying I didn't have enough money to cover my bills so I was floating checks will not fly. They will deny the loan. So, be very careful about how you explain them and make sure it is something that is rooted in the truth and that you can document at least to a degree. Also, even if your loan officer says just put whatever, the UW will not really care....Do not believe them. Alot of times they make you fill out the explanation forms for past credit problems, etc and those are always kind of filler as the UW just kind of looks them over for obvious discrepancies. But, they are usually old enough that the UW is not overly concerned and also harder to obtain any useful docs anyways...Due to this, the LO may tell you that these things are just a formality and just put whatever to explain them. I know for a fact in my case we were told that and thank god I didn;t make soemthing up because our UW called us on one of the letters that was more recent and we had to document the reasons given. In this tighter market, they are checking alot more than they used to. Just be careful.
Good luck with it.
