Overdraft received while in qualification

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This topic contains 1 reply, has 2 voices, and was last updated by  TTrumble 3 days, 21 hours ago.

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  • #39634

    foxxytg20
    Member

    My file is currently with the underwriter to hopefully be qualified by Jan 2018. Been so stressed out with the process and my counselor I’m at my wits in with the process. My issue now is that yesterday I officially got a overdraft on my checking account. This bank statement will probably not be seen before qualification since all docs are in and its being worked. BUT this bank statement will be viewed when its time for that 2nd review before closing ( I think). What issue will this cause for me? Will I have to wait more time to actually purchase? I’m so sad right now. I had the money in my savings account but turned off the overdraft protection for this program.

    #39638

    TTrumble
    Member

    Hello foxxytg20,

    The very first thing you should do is write a Letter of Explanation detailing how the overdraft happened and what steps you have taken to make sure it doesn’t happen again. Make sure it is submitted to yoru file at the same time as your bank statment showing the overdraft.

    Also, if this is your first overdraft, call the bank and ask them to reverse the overdraft fee as a courtesy. Be straight up with them and explain to them that you are in the process of buying a home and that the fee could affect your mortgage application. Chances are they will reverse the fee for you, which will go a long way toward getting the overdraft “overlooked”.

    My greater concern is how this might affect your Payment Shock Savings. Remember, the sum total balance of all bank accounts must increase by at least your Payment Shock amount each and every month, or that will set you back at least three months. You may need to address that with your counselor if your PSS falls short as a result of the overdraft.

    Bottom line, be proactive about the situation and your chances of this NOT affecting the process will increase substantially.

    Tim Trumble
    Online Operations, NACA
    ttrumble@naca.com

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