Post # 1
My hubby and i are in the process of buying a home and it is beyond nerve wrecking. After multiple offers put in fell through for various reasons, we are finally in a pending contract on a wonderful house! This is my first time buying a home, yet my husbands second. He bought a home when he moved to our city in 2005. Our city in SW Florida was one of the hardest hit during the real estate boom and then ultimately with regards to foreclosures, and he (like so many others) lost his job in 2009 and ultimiately ended up foreclosing.
So now we are in this process and both of us have been pre-approved for a mortgage…Found a home, inspection went great… The home is in great shape.. and next step is our mortgage broker submitting the official application for underwriting. This has me a nervous wreck.
In addition to the foreclosure, he had defaulted on some student loans and had credit card charge offs from 2009 when he wasn’t working. I know so many others were in the same predicament during those times so the underwriters must see it a lot, but I’m still beyond paranoid that this loan isn’t going to go through.
Just looking for some reassurance or advice from anyone who may have been in a similar situation! I truly won’t believe the home is ours until keys are in hand lol…
Post # 2
- Wedding: October 2016 - Harn Homestead
I didnt have a bad histroy when I went to buy a home, but surely if you dont have any issues they will see you as a positive. As far as his negatives, they were awhile ago and if he has been on time and no creating a lot of debt I dont see why there would be an issue.
Post # 3
Interesting difference in process. In Canada you get pre-approved for your financing, before you go house hunting so as long as you find a house within your budget, you know you will have financing.
Post # 4
Well, we were pre-approved…. And the home we’re buying is about 30k less than what we were approved for!
BUT, the pre-approval the mortgage brokerage does is pretty basic…. Pulls your credit report/history/scores and approves you from that.
The mortgage underwriting proess is where they’re going to like go through our financials/account statements, etc with a fine tooth comb!
And of course, I’ve googled it and read horror stories on line of people being denied the loan after being pre-approved, or even worse — just a few days before closing, etc etc…. I really just need to stay off the internet through this whole process probably.
Ya he has stayed away from debt ever since his finanical issues. (outside of student loans)… In fact, last year when we first started thinking about buying this year, we spoke with a friend of mines husband who is a mortgage broker, and he pulled him up and from what he saw, he had NO credit, since he hasn’t used any in so long, so advised me to add him to some of my cards, as all my cards have low balances lol.
I did have my issues w/ debt, but have since basically payed off all my high balance credit cards.
Clearly something worked as they were able to give us a pre-approval… Just hoping all goes well with the underwriting proces…
Post # 5
I was kind of in your DH’s boat, but it was SE FL and it was 2008. Those were bad times. We lost our house, too.
If he’s been pre-approved then I’m thinking you should be good. I mean, that’s why you go through that, right? To get your ducks in a row so you can make an offer? Did your mortgage broker say he thought it might be a problem?
Post # 6
If you went below what they told you, you should be okay.
My BK was back in 09 from the housing boom of 04 bust in 08. My credit score is now 750 and I bought in December.
I was in the exact same boat. And my problem was the debt to income. They ended up fighting me over over $700 dollars saying it took me over debt ratios because the taxes came back higher than they expected. They looked everywhere to bump up my income. It was the most ridiculous thing I have ever seen. It ended up being a 90 day close. from very start to end. Even after papers were signed and it was ‘over’ they screwed up the papers and I had to go back and sign new papers a month later. I totally understand your stress.
Post # 7
So that’s the difference. In our pre-approval process the mortgage broker submits your information to the lenders (banks, credit unions, trust companies etc) before you go home hunting so you already know the exact amount they will lend.
Anyhow, good luck in getting approved.
Post # 8
The scary thing about pre-approvals for mortgages in the US is that they aren’t really approvals at all, they’re just an educated guess, more like an “application” process. Anyone can get a pre-approval. Getting through the actual underwriting process is closer to being hellish. Debt to income ratio, credit scores, etc., for the past year or two will be looked at the most closely but be prepared to answer for every little tiny thing on your credit reports, even going back years. It’s not fun and is very stressful but hopefully it will work out.
We sold an inherited property in Virginia recently; two potential buyers in a row had been “pre-approved” but when it came down to actually getting the mortgage loan to buy the property they were denied. It was a pain for us because we had to re-list on the market each time it fell through (finally sold it for real and closed last month – woot!). Pre-approvals are a general guess at best, from mortgage companies. The worst I’ve seen is with Wells Fargo (hate them but they rule the freakin’ world right now). Mortgage companies are so hard to work with these days.
Post # 9
We just closed a house in FL last Friday, so I imagine your process will be similar to ours…
The preapproval was nothing at all, just a credit pull and a few questions on the phone. The underwriting process was very in depth and pretty stressful. Your husband’s negative credit stuff is right at the 7 year mark, are those things even still on his credit report? If not, then I wouldn’t worry about it. If so, those probably would have come up in the preapproval credit pull and should have been brought to attention by your mortgage broker.
We got approved for a mortgage with both of us having new jobs within the last couple months (and DH has a commission-based job, plus he’s changed jobs 3 times in the last year within the same industry) and with DH having some late student loan payments from 2014. I was honestly surprised that we got approved with those issues, given all of the horror stories that I read online (you need two years at the same job, spotless credit, issues with commission positions, etc.).
I feel your pain though, we also had issues with the house appraising low and having to renegotiate. I refused to get my hopes up until the keys were in hand.
Post # 10
Ahhh ya I’ve heard Wells Fargo is the worst. Well, we’re dealing with a mortgage broker, so I’m hoping she has multiple lenders that she can utilize just in case the worst case scenario happens and one doesn’t approve.
I would rather plan 20 weddings than deal with this for 45 days any day! LOL
Post # 12
Sounds like your pre-approvals are like our pre-qualifications. My pre-approval was underwritten.
There still can be issues here, but it’s more to do with how the lender views the houses value, or if there’s a change with someone’s finances, etc.
Post # 14
Are you sure it wasn’t a pre qualification? When we were preapproved that was it. They approved of us. The next step was approving of the house and I believe they double checked to make sure neither of us had lost our job in the last month since they had written our pre approval. If it actually was a pre approval you shouldn’t need to worry about his previous financials anymore, just that the house is appraised at or above what you are paying for it.
Post # 15
I imagine all the issues you’re affraid of came up even in the pre-qualification. Things like forclosures and collections come up quickly. If one of you had strange income sources like commissions or large bonuses I might be a little more nervious but it really seems like they are aware fo the worst of it.
Also, when I and my sister bought our houses they gave us INSANE preapproval requirements and relaxed them when the actual mortgage was drawn up.
For me, they told me I had to put an extra 10% down while I was building (they changed their mind but I had already saved it), they initally told my sister she had to get rid of the car loan and close a couple of her credit cards but she only closed the credit cards and was able to keep the car in her name.