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approved for conventional loan but....

Established Member

approved for conventional loan but....

I was approved for a conventional loan....went thru the process with my realtor of price offer etc and then BOOM......the mortgage company tells me that I can't get PMI because of a BK.  Now, the BK was disclosed up front.....it is 3 years and 6 months old after dismissal.  I now have to wait 6 months??

 

Is the 4 year waiting period not well known by mortgage underwriters?  We went thru a week of discussions only to come down to time to offer and no approval.  Everything else is fine.....is there anything else that can be done?

Message 1 of 10
9 REPLIES
Senior Contributor

Re: approved for conventional loan but....

Find another lender.

Message 2 of 10
Established Member

Re: approved for conventional loan but....

is this true though that no MI will insure my loan since my BK was dismissed 3 yrs and 6 months ago? 

Message 3 of 10
Moderator

Re: approved for conventional loan but....


reba1 wrote:

is this true though that no MI will insure my loan since my BK was dismissed 3 yrs and 6 months ago? 


Yes, it is true. It is well known in the industry. Why your LO took the application for a conventional loan knowing that the loan couldn't be insured is a mystery.

 

However, you have some alternatives:  1) go FHA where it is government insured and the requirement is 3 yrs rather than 4 years or 2) go to a smmall regional lender that holds the loan in their own portfolio,

 

Was your BK discharged or dismissed?

Message 4 of 10
Established Member

Re: approved for conventional loan but....

the BK was dismissed.  I filed in april 2010 and it was over in August 2010.  I was wrapped up in something that was not really me but to protect my assets i had no choice.  Then I had it dismissed. It took until February 2011 to get the final order. 

 

The house I want is above an FHA.  I make too much for a USDA.....my annual base is $150k.  well enough to purchase a 400k home.

 

I don't know of any lenders that dont require the PMI.  Does anyone??

 

thanks!

Message 5 of 10
Highlighted
Valued Contributor

Re: approved for conventional loan but....

You have 3 options

 

1. Put 20 percent down

 

2. Go FHA on a cheaper house

 

3. Wait the 6 months

 

If it were me I would wait the 6 months. I was in a situation just like yours, UW said I had 6 months to wait and I was denied. So we built a second house, took 6 months to build anyways and we closed without any issues.

Message 6 of 10
Moderator

Re: approved for conventional loan but....


reba1 wrote:

the BK was dismissed.  I filed in april 2010 and it was over in August 2010.  I was wrapped up in something that was not really me but to protect my assets i had no choice.  Then I had it dismissed. It took until February 2011 to get the final order. 

 

The house I want is above an FHA.  I make too much for a USDA.....my annual base is $150k.  well enough to purchase a 400k home.

 

I don't know of any lenders that dont require the PMI.  Does anyone??

 

thanks!


I have a lender that will do no PMI with 10% down on selected loans.

Your options open up if you wait the six months.

What is the conforming loan limit in your county? Here in my county it is $417k  - it will could a difference if you are jumbo or not.

Message 7 of 10
Established Member

Re: approved for conventional loan but....

it is $417k loan limit.  i think the 6 months is my best  bet here to get the best deal unless there is a lending that will do something else.

Message 8 of 10
Super Contributor

Re: approved for conventional loan but....

Perhaps the underwriter was OK with a 2-year dismissal (the waiting period if there was extenuating circumstances), but the PMI insurer didn't agree.  There are multiple PMI companies out there.  Did you ask the underwriter if they tried every one they are approved with?

I'd also ask the underwriter why they were able to approve your loan less than 4 years from the BK dismissal.

 

Lender approval is different from PMI approval, and PMI approval is one of the very last steps... which explains why this wasn't an issue at the beginning of the process.

Mortgages (FHA, VA, USDA, Fannie, Freddie, Non-Prime, Construction, Renovation/Rehab, Commercial Multifamily) since 2002
In Irvine, CA and lending in all 50 states

Information that is needed to determine if you qualify for a mortgage

shane@thebesthomeloans.com
Message 9 of 10
Established Member

Re: approved for conventional loan but....

From what I know, there is no pmi that they approved that will waive the 6 months left until the 4 years are up. 

Message 10 of 10