Score Dropped In The Middle of Purchasing First Home

[Anonymous]

Hoping someone can help me understand. In  March my Fico 5,4&3s were around 680. April they dropped to around 660. I was prequalified anyway, put in an offer, it was accepted. Paid for inspections, appraisal. The only thing that has changed is my Wells Fargo Loans transferred to another servicer (Firstmark). At first I thought once Firstmark reported, I would get the points back but it's reporting, this month (5/23) my mortgage scores dropped to 640. Now they won't give me my mortgage. I've had no late payments, no big purchases, nothing. We were set to close this Friday, I have 7k tied up in this deal, and I'm devastated and just want to understand why this happened.

[babygirl1256]

Greetings Case-si . . . so sorry you are experiencing this. I can't tag anyone but please reach out to one of the mortgage experts and perhaps you can obtain some quick guidance. It will be ok, there are so many experts on this forum that will assist as that's what I have experienced over the years. Wishing you success in closing as scheduled. 

[House2021]

You should post this to mortgage forums, is there anyway at all to switch to FHA or is the FHA limits to low for this purchase? I'm so sorry this happened. Did your lender try to do a credit simulator to see how to get your score up? Seems unfair

[Anonymous]

Ok I will try that.. but I don't think FHA will work for me because I have a lot of student loan debt (150k)  and FHA uses 1% instead of the income-driven payment amount which is $185 for my monthly debt which would then put me way above the DTI limit.

TBH my lender is a joke. He should have told me this weeks ago, instead of a week before closing. He didn't even tell me why I'm now being denied I just assume it's this, but I will try and get some answers out of him. 

thanks for your reply. 

[House2021]

Case-si. FHA goes up to 56% on debt ratio, so that might help I have no idea the payment, your other debts other than student loans, if your ratios would work or not. I would talk to another lender see if you could save the deal. When I used to work as a real estate agent, I saw many deals go sideways but other lenders could sometimes save it. Maybe even homebuyer grants that, if approved, would help your debt ratio since it would be less money to loan. 

[Anonymous]

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@Anonymous wrote:

Hoping someone can help me understand. In  March my Fico 5,4&3s were around 680. April they dropped to around 660. I was prequalified anyway, put in an offer, it was accepted. Paid for inspections, appraisal. The only thing that has changed is my Wells Fargo Loans transferred to another servicer (Firstmark). At first I thought once Firstmark reported, I would get the points back but it's reporting, this month (5/23) my mortgage scores dropped to 640. Now they won't give me my mortgage. I've had no late payments, no big purchases, nothing. We were set to close this Friday, I have 7k tied up in this deal, and I'm devastated and just want to understand why this happened.

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@Anonymous i'm very sorry this happened to you. Were there any other changes to your file? What's the age of your oldest account? What were the B/L of the loans before & after the transfer? Did the new loans have new opening dates or were they backdated?

sorry to ask so many questions I'm not trying to be intrusive but these are answers I need to try to determine the answer to your question. 

[CyberChick]

Oh my, what a nightmare. 

I am hoping some of the experts here can offer quick resolution.

[tooleman694]

How long ago did they pull your mortgage scores? and what were they

[Anonymous]

I was preapproved on 4/24 so it had to have been right about then.

[Anonymous]

The balances were the same (1600, 12,000) and they back-dated the opening dates. No other changes but the inquiry from the mortgage company which only dropped my score about one point. Sorry it took me so long to reply.