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jwood1199 · Joined: 25 Feb 2009 Posts: 1 1.43 Dollars($)

We have applied for a 15yr fixed FHA refianance loan with Countrywide. I have a mid FICO score of 680 and a chapter 13 that discharged 12 months ago.My wife is the only one on the current mortgage so we added her to the loan and she is self employed with a lower 600s score. From everything I have viewed we should qualify for the loan but was told it did not get approved electronicly and had to go to the underwriters. Is this the kiss of death?

smithsussane · Posted: Wed Feb 25, 2009 9:11 pm Post subject:

Hi jwood!

Welcome to forums!

As far as I know, if 12 months have passed since your bankruptcy was discharged, you should be able to get a FHA loan. Did the lender give you any reason as to why your loan did not get approved?

You can even speak to other lenders who are offering FHA loan. This will help you to check whether you can get loans from them or not. You can also speak to the lenders of this community and seek a no obligation free mortgage consultation from them. This will help you in getting a fair idea as to whether you will be getting a loan or not or what kind of rates you will get.

Feel free to ask if you have further queries.

Sussane

gmakerley · Posted: Thu Feb 26, 2009 7:43 am Post subject:

lenders use automated underwriting. a bankruptcy will not confer a finding of "approve/eligible" but will come up with "refer/eligible." what this means is that the underwriter must now use his or her brain to determine if your loan is worthy to be approved. no, it is definitely not the kiss of death, though it does mean that someone is going to look over your qualifications a little more closely.

if you've documented your situation well enough, and the scores meet guidelines (which seems to be the case), then you'll stand a decent chance of having a manual underwrite come back with an approval. you may be asked to provide additional information to support the decision.

Guest

I did read he FHA hand book and am pretty positive that we meet FHA guidelines , I assume it is the lender ( Countrywide ) that is looking closer.Hopefully we will get an answer Friday.

carlpruitt · Posted: Thu Feb 26, 2009 8:53 pm Post subject:

I'm sure the reason that the automated system didn't approve the loan is because of the bankruptcy.

The standard guideline is that it should be 24 months since the discharge of a bankruptcy before an FHA loan is approved, but the UW is given some leeway when it is a chapter 13 with a good payment history, a good explanation, and re-established credit. (In theory, the UW has some leeway after 12 months has passed since a Chapter 7 was caused by unavoidable circumstances but the exception is only very rarely granted.)
Thanks!

Guest

The new word now is that it was not uploaded but faxed to a local FHA UW
so what that means I am not sure ? I do know we are still waiting .I was also told by the lenders Corp office that the UWs are very swamped at the end of the month.

Guest

I would suggest you to directly speak to your lender and get the whole issue cleared. Your lender Will be the best person to tell you when you can get the loan approved.

gmakerley · Posted: Sat Feb 28, 2009 5:42 am Post subject:

one of the problems of the mortgage industry that we all hope will be solved one day is that the end of the month is positively crazy for most. virtually everyone wants to get their loans closed by month-end (loan officers, sellers, buyers, realtors), and that means that underwriters are burdened with last-minute issues and pressured to clear loans for closing. so what they've told you is undoubtedly accurate as far as there being a very busy group of underwriters.

again...because the automated system didn't approve your loan, it's got to be reviewed by someone with a clear understanding. supposedly every underwriter has a clear understanding of what constitutes a good loan, but we all know this isn't a perfect world.

hang in there, it won't be too many more days, and you'll get the word on your loan. from what you've said, it ought to be approved.

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