A few questions before my intake – Lender Match, New Credit Lines etc

Home Forums Purchase Program A few questions before my intake – Lender Match, New Credit Lines etc

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  • #58828
    Heather15
    Member

    Hi all! I am trying to get my ducks in a row for my intake meeting. Have some more questions I’m hoping ya’ll can help out with – I’ve tried searching the forum for these but couldn’t find a topic that addressed these issues.

    1) Lender Match – once I buy down my 7 points (minus $3000 broker fee and minus 3% hand escrow if applicable) – I would be eligible for lender match on anything else I put down towards the principal of the loan. (I am below 80% median income in Charlotte, NC). Does the same principal apply to lender match – 1% of the loan amount used towards principal would equal .25% interest rate buydown from BOA? I swear I read somewhere it was only .125% for Lender Match so I wanted to make sure. This would be for a 30 yr mortgage.

    In June I co-signed with my mom for a Havertys credit card so I could buy new furniture. This was before I found out about NACA or wanted to purchase a home. I’m on a 0% interest 36 month equal payment plan. Does this credit line need to be open for a year in order to get NACA approved? I have numerous other credit lines with 24 months good payment history – so this one would not be needed to show that. But I thought I read all credit lines had to be open for at least a year…

    Finally, my wallet was stolen about 3 months ago and in it was my social security card. Does NACA ask you for your physical social security card at any point or BOA? Should I plan on going to the SSA to get this renewed or is that not necessary? My number is the same it’s always been and no identity theft ever came from it – at least not yet. I have credit monitoring so I would know should anything weird show up on my report.

    Really appreciate everyone who has posted on here and answered and explained how everything went in their NACA process. You’ve all made it infinitely easier for us newbies. This forum is such a useful tool and I’m so thankful to have found it. I’m sure I’ll have lots more to post about in the future to spread the help on to others as well!

    #58829
    Nelsont
    Member

    Before you get your hopes up it seems boa did not plan for quite the amount of loans they were going to issue this year. A lot of people on this board have been reporting starting in August that the grants have run out of funds for many areas and possibly entirely for the year.

    If the lender match is not considered a grant (I’m really not sure if it is or not) then you you can only choose 1: lender match or automatic 1% interest rate reduction if you are 80% of the median income. With that said I’m not entirely sure but I think the lender match is only for interest. I think the principle would be entirely on you. It just doesn’t make sense for boa to match the principle. You can view the interest rate buy down match as a sale – a company is giving you a discount or a good deal. But matching the principle would be like boa paying you to buy the house from the seller. Since the interest goes to the bank and the principal goes to the seller. And yes .125 is the minimum but it’s based on multiples of .25. So if the interest rate ends in .125 .375 or .625 you can get to .125. Otherwise you can’t I don’t think.

    Your new line of credit should not need to be open for a year though it is inadvisable to open any new lines until after you close on your house. In this case you will probably have to show good payment history on that card but as long as you have other lines active and in good standing with 12 consecutive months of no missed or late payments you will probably be fine. Just be aware since your mom cosigned she may be asked to have her finances reviewed as part of your qualification or at the very least provide a letter of explanation. The other thing about 0% interest if paid in full is that it can be viewed as total debt and not revolving debt. Usually with credit cards the minimum monthly payment is factored into your DTI. If you are not getting a minimum payment statement from havertys then the total amount will be considered debt and if your DTI is above 40% one thing that may come up is paying off that card entirely.

    You should send out for a new ssc. And it may take a year for identity theft to show up. My identity was stolen in 2017 and the only reason I knew was because I had a collection show up for a cell phone bill in 2018. The opening of the cell service never registered.

    I hope everything goes well for you. Keep us all updated with your process.

    #58830
    Heather15
    Member

    @NelsonT – as usual thanks for your prompt and thorough responses!

    The 1% BOA Grant is unfortunately not available in my MSA (Charlotte, NC). So I’m not planning on using that. I’m also not planning on buying until hopefully spring/summer 2020 – assuming all of my NACA stuff is in order and I’m approved. Just so I’m clear – with the lender match
    (if indeed it is still available when I purchase) – BOA’s Match still lowers the interest rate 0.25% for each 1% I put towards principle. Thank you for clarifying.

    As far as the Haverty’s – it shows up on my credit report as a “Charge Account” with a minimum monthly payment of $81.00. (That’s what I pay for the 0% APR 36m deal.) I’m currently working on paying off all my credit card debt so that it doesn’t affect my DTI. If I have to pay the furniture off too – I will. But I have that $81 included in my 9% with my car loan as the only debt I’ll have once I submit to be approved. I’m hoping to get approved for the maximum 31% – still don’t know what that will be though with my W-2 and 1099 income together. That’s a whole different story that once I have my intake session i’ll know more about.

    I didn’t realize I could order a new SS Card through the mail? I’ll have to look into that!

    As always, this forum is the best.

    #58831
    Nelsont
    Member

    Your 31% is not based on w2 or 1099 it’s based on current gross income before taxes. The IRS paperwork is to verify stability in work history. Even getting a new job a month before your intake won’t matter. They just want to see that you aren’t unemployed. Unless you’re income is all over the place you can easily figure out your 31%.

    #58850
    Heather15
    Member

    @Nelsont – I’m having a hard time with my 1099 income. My W-2 obviously is straight forward – but I also do Amazon Flex part time and have been for over 2 years continuously. Both tax returns (2017 & 2018) show my gross income for Flex to be $19,523 and $20,732 respectively. However, based on information I’ve obtained from reading through this forum and from asking at my Workshop – NACA will only go by my actual Income that I paid taxes on – which is approx $3500 each year. I write off all my mileage (which is a LOT) and so the mileage deduction pretty much makes it so I don’t owe a ton of taxes at the end of the year. I was told at my workshop that they would only count the $3500 “profit” on my taxes as income. I’ve also been told that they will look at my monthly bank statements and do a profit & loss sheet of the gross income I receive from Amazon Flex and how much money I am spending on gas/oil changes/cell phone which are my monthly expenses for the job. If that’s the case – then my gross income would probably go up to at least $10,000/year. I had an outside mortgage loan officer tell me that with a lot of conventional mortgages – they will add back half of the mileage deduction into your gross income – but at my workshop the MC said that was not the case with NACA. This is probably the biggest question mark I have right now. I’ve been calculating my 31% with my W2 + $3500 just in to be realistic. It would be VERY nice to be able to count the $10,000 extra income though lol. Amazon does not give us any pay stubs or pay verification of any sort, nor will they – so the only proof of that income I have is my 1099 and the direct deposits into my bank account. Amazon wants to make sure they don’t look at all like a direct employer so they will not give you print outs of anything – I already tried. If you have any thoughts or have read anything differently about 1099 – i’d love to know! Otherwise, I guess i’ll let everyone know what happens after my intake meeting.

    #58876

    Just a small correction, @nelsont – If you are eligible for the 1% BOA program, you actually cannot choose, and you must take the 1% instead of being allowed to buydown further – per the UW at the ATD event we went to. It was a disappointing surprise since we were able to buy our rate down to the minimum if not for the extra 1% program.

    #58877
    southflorida
    Member

    I did not need to provide the original Social Security card

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