May 23, 2020 at 8:19 am #68376
Received qualification letter and the conforming loan amount is based on 2019. Our MC during the ATD event calculated everything using 2020. 2019 the amount was $484k and 2020 $510k, is this correct?
Also we did a short sale 2017 not bc we couldn’t pay mortgage, but bc spouse took a job out of state and we need to quick sale in 2017. The underwriter said it’s looked at as a risk although our credit report clearly shows no lates ever. If there was a late why would 2017 be looked at? So because of this our qualified amount dropped $23k bc of risk. The house we were looking at was $482 and loan approved for $460k any recommendations?May 23, 2020 at 8:31 am #68377NelsontMember
That doesn’t sound right. Unless I’m missing something income and debt are the only 2 affordability drivers in the naca program. Risk shouldn’t factor into it. Now it is possible the underwriter thought your MC was too generous. It’s also possible 460 is a typo. I would bet it’s one of those. The only other thing I can think of is somehow you have an active/reporting debt tied to that short sale or something else on your credit report.May 23, 2020 at 8:39 am #68378
I agree with you. I asked my MC how I can have the file reviewed and she said “ well the UW sent it to regional and that’s what they said”. I’m frustrated because the MC reading the UW notes to me about the short sale in 2017. Like we have gone over ten years without any lates, charge offs, no collections. I just read text again and MC said your son car was added to debt although we provided letter from bank along with statements showing he makes all payments electronically out of his account, yes I’m the co-signer, but again he’s never been late and it shows paid on time. If the conforming loan limit’s was to be changed to 2020, could that make a difference in loan amount?May 23, 2020 at 10:33 am #68379TTrumbleMember
You have clearly misinterpreted something or are somehow connecting two unrelated things.
There is absolutely no “risk factor” in NACA’s determination of your affordability. That is in fact one of the reasons we are able to give everyone the same terms, regardless of their individual situation. Anything that affects your affordability is something concrete and not something so ambiguous as a “risk factor”.
Even though the short sale was more than 24 months ago, a voluntary short sale because you wanted to move quickly appears no different on paper than one for the purpose of preventing a foreclosure. As such, a Letter of Explanation is going to be needed. Unless the leftover balance from the short sale (loan balance minus the proceeds of the short sale) was not accounted for, the short sale should not have had a bearing on the situation.
You MUST get back with your counselor to get a clarification, especially on why the approval came back lower than requested, and what can be done to possibly obtain a higher approval.
The 2020 conforming Loan Limits went into effect on January 6, 2020. Based on what you have written though, it’s irrelevant in your case as the 2019 figures still covered your desired amount. The Conforming Loan Limit only determines the absolute maximum amount of loan we can make and does not affect your specific affordability.
Don’t forget that you can use the interest rate buy down feature to increase your approval very easily. Based on today’s 3.125% 30-year rate, a one-and-a-half point buydown reduces your rate to 2.75% which in turn increases your maximum purchase amount from $460,000 to right around the $482,000 figure. In short, less than $7,250 fixes your affordability problem regardless of what happened.
Get clarification from your counselor for the simple fact that you deserve to understand what happened, but your best bet is going to be using the interest rate buy-down to get the purchase amount you want.May 23, 2020 at 1:21 pm #68389
Thank you for the wonderful feedback! I didn’t misunderstand the MC used the word “Risk” when they read me what what UW write in their report. However, I’m good now numbers was figured out on how to make it work.
- You must be logged in to reply to this topic.