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chatter2960

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Here are my scores: The 11/22 score is before I applied for mortgage. The 12/8 score is what the LO got when she ran credit with Landsafe. The 12/15 scores are what I got when I checked my credit later:

TU / EFX / EXP

11/22 myfico - 578 / 598 / 551

12/8 landsafe - 585 / 545 / 557

12/15 myfico - 585 / 598 / 559

My most recent scores with myfico are 625 / 626 / 579. This are from last week or so. I still have a thing or two in dispute.

My question is, should I have LO Run credit again? We still have not gotten final word on approval. We have been trying to get mistakes corrected before applicaton is sent to underwriters.

Also - we are getting grief about my wife's income. She is on social security disability. They want a doctor's evaluation and we can't get a copy from social security for another 3 months! We don't have that long, as the contract on our house will expire. If our scores are improved, will that be as much of an issue?

Thanks for your input guys!

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I tell you what I've had one pre FHA Loan and are in the procees of closing the second. Personaly I think FHA is the way to go. I have been doing collection at Wamu for prime and subprime loans for 3 years now. I feel FHa is way more secure usualy they wont even review for F/C until 5 months of delquincy where as conv loan is 3 months. As far as scores go you should be more then ok I'll admit the underwriting process is a little more strict but then again the depends on the lender. What I would do is consider other lenders, shop around if your givin the run around.

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I can not get washington mutual to do anyhing correctly. I have had letter upon letter and get the same crap.

I am fixing to file suit and will win due to a letter that was sent to me from them.

"foreclosure will remain indefinety on your credit report"

Can't wait to see their explaination on that one to the judge. And I never had a loan from them!

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...Also - we are getting grief about my wife's income. She is on social security disability. They want a doctor's evaluation and we can get from social security for another 3 months! We don't have that long, as the contract on our house will expire. If our scores are improved, will that be as much of an issue?

Thanks for your input guys!

Proving SSDI continuity is often a pain and SSA representatives are not noted for being cooperative. The underwriter wants to see evidence that the benifits will continue for at least three more years and SSA often will counter with they cannot give such assurance because a cure might be found tomorrow. It many cases it is possible to escalate your case with managers of the SSI office until you get a written confirmation that the next scheduled review will not be for at least another three years or get a written assesment from them that she is classified as 'not expected to improve' which means the reviews are every seven years.

I have found it easier to go through the physician. Have the doctor write a simple note on professional stationary noting they have examined her and it is their professional opinion that she will not be able to return to work for at least three years.

Regarding the credit scores, I would mention the improved numbers to your LO. It could possibly mean a significant advantage in your terms.

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Proving SSDI continuity is often a pain and SSA representatives are not noted for being cooperative.

That is an understatement! Thanks for your comments thought, that really clears up some things for me. Wife'd doctor has been totally uncooperative, so we asked our attorney to request the SS Doctor's evauation. The SS office says that her file is in Baltimore and it will take 3-4 MONTHS to get it!! :evil:

We absoloutley do not have that long, so I don't know what is going to happen at this point. This being in limbo is making us want to slit our wrists.

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I suppose you have looked for your original documentation from them? SSA says they send a letter advising clients of their status but I have heard so many people tell me they have never received any such letter I have to assume sometimes that letter does not make it out.

It is unfortunate when the physician is also being uncooperative. SSA has a form on their website that is supposed to give you all the documents associated with your file within a week but after filling it out with clients several times I never had any success with it. One client called me back a month after the loan closed, he still had not received anything from that form.

In your case, I might try calling the 800 number and keep trying until you get somebody helpful (they do exist). Tell them you need the determination of her medical status and when the reviews are required to continue receiving benifits. If you tell them you need 'proof' that benifits will continue they will clam up. It means being put on hold for long periods of time and can be frustrating. I have made the calls before so I could explain exactly what we need, but the client actually needs to make the call before they will release anything.

Hang in there, and good luck!

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thank you thank you thank you,

your info has been so helpful!

I already searched through all of our files, yes SS never sent us an award letter or anything that said when her next review would be.

Her personal physician's office told her that since she wasn't bed-ridden she is able to work. dumbasses, they have no idea. Like my wife wants to sit home and make1/4 of what she used to when she had a job.

Do you know what the document request form is called? I will keep searching on the website for it.

I will also have my wife call as you said. We may even go to the district office in person.

Thanks again!!!

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One suggestion is that you go to a doctor that will take the time to understand what it is your wife does, then see what her physical problem is, then see if it is reasonable that she can work.

As in every industry/business there are caring and not caring people, change to someone that cares is my suggestion.

The letter requested is a very simple thing, does not have to be a form, or at least has not needed to be one when I have needed to send something like this in.

Charles

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The online form that I have tried to use starts here:

https://s044a90.ssa.gov/apps6a/BEVE/main.html

Like I said, though, I have filled it out for clients when they were on the phone with me and they never did get the information sent to them.

The award letter will not say how often the review is but it is supposed to indicate the medical status which determines the frequency. If the status is 'not likely to improve' underwriting generally has no problem with it. If the status is 'possible to improve' it gets a little tricky. I have been able to get it approved in such situations by a combination of documenting a recent review and actually printing out and showing the underwriter the 'Reviews' chapter on this page:

http://www.ssa.gov/pubs/10153.html#6

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OMG.

I filled this out a long time ago and we got the thing in the mail yesterday. My wife mentioned it this morning before I left for work, but I didn't even look at it. I will have to call her and see what it says.

I also read the info before about the reviews. That is why were were hopeful about getting a copy of the SS doctor's review. When my wife saw him, she was still in a wheelchair and had double vision all of the time. I am betting that said improvement not expected, but it is very possible he might have put some improvement possible.

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My wife did find out from SS that her next review is in March of 06. She talked to LO and said that she didn't sound very encouraging. We are so depressed.

I am thinking I should go with another lendor, but I don't know if we will run into the same problem. This is so stupid. I mean, what guarantee do they have that I won't quit my job 1 year after I get a mortgage.

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If the option that firstsource suggested (seeking a more accomodating physician) is not available, you may have trouble using her income with any lender on a full doc scenario. If you were able to get a qualifed professional opinion that she will be unable to work for at least three years then the LO could submit that and the upcoming review would be of lesser consequence.

Did the LO try running the scenario with your inome only? With the increased credit scores there could be a chance of getting approved with your income only, especially if you have paid down some CC debt since initial approval. Then there is always reduced doc scenarios to keep your options open.

As far as your income not being gauranteed, the underwriters usually use the fact you have been employed for the last two years as reasonable assumption you will remain employed for the next three.

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My wife did find out from SS that her next review is in March of 06.

How long ago was her last review? I made my last comment assuming it was within a year or two. If she is getting reviewed every seven years, that would indicate she is not likely to improve which would also diminish the significance of the upcoming review.

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sorry. I guess I could provide more information.

My wife is 29 yrs old and this would be her first review. Our car accident was in Sept 2002. She was reviewed by the SS doctor in 2003. I am guessing that they will cancel her disability when she is reviewed again because she has made improvement.

That doesn't mean that we both think she is able to work, but that is a whole different battle. We just want to buy a house right now.

Is this a problem because we are going for FHA, or would this be an issue for any type of loan?

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Based on the documentation you currently have on hand, I would tend to predict the potential of problems using her income on any type of full doc loan whether it is FHA or not. To the best of my recollection, FHA uses the same guidelines to validate fixed income as FNMA. The determination on her next review should be based on whether she is able to continue in her line of work regardless of whether she has shown any improvement but that is a moot point at this moment in time. If you can find it on her award letter that states her status as 'possible to improve' the LO could try showing that along with documetation that such status is reviewed every three years to the underwriter and hope the question of when the next scheduled review is does not get asked but I have had mixed results with that approach.

If I were you I would be discussing contingency plans with the LO as your options should have increased with the credit scores improving. Is there any way your income can carry the loan by itself? How much is your monthly debt and is any of it in your wife's name only? What percent of the purchase price are you able to put down on the home? These are a few of the parameters that would need to be known to guess as to what your options are.

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Thanks again for your advice!

Our LO advised against re-running credit because she said they would have to do it again before the loan closed. We have documented all of the errors and corrections that were to be made, so I guess that will be enough.

My wife and I have thought of another option we are going to try. Since we now know that her status is "possible to improve", we are going to ask her doctor if he can sign a letter saying that there will be no significant improvement from her current condition. Although she has made considerable improvement since her first SS review (the underwriters will not know this), with traumatic brain injury patients, most of the improvement is within the first two years. We know, and the doctor has said before, that any improvement she might make form now on (if any) will be VERY slow, and over the course of several years.

So this is where we are: We know that she was awarded disability with her status as "possible to improve." She is scheduled for review every three years. We will get her doctor to say that there will be no significant improvement from her current condition. We will not say ther her next review is in March 06 unless we have too.

I am hoping that maybe that will do the trick. If not, we will try to come up with a plan C.

How does this sound?

Thanks for everyone's help.

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By the way, I don't know if I could get the loan on my income alone. Here are our circumstances:

We are applying for a loan of $119K This includes all closing cost and no money down.

My income is $30K per year.

My wife's is $9600 per year.

We have about $2000 in savings that is in my name only.

The only debts we have are a $225 car payment per month. We owe $7900. It is in both of our names. I am the co-signor. My wife is the borrower.

I have a student loan that is on an in-school deferment. The monthly payment is $150. It is in my name only.

My wife has student loans that are in disability forbearance. Her monthly payment is $110. They are in her name only.

That is it. No outstanding loans or credit card debt. Do you think I should try purchasing alone? I don't think my income is high enough. I am VERY confident that my score is going to reach 650+ by the time we are wanting to close (end of March).

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Since you are doing FHA the increased credit score will probably not affect the terms of the loan so your LO is correct in that there is no reason to pull it again right now as long as you have the approval. Your income might be enough to carry the loan by itself. Did the LO mention whether she had tried running it through automated underwriting without your wife's income? Carrying all the debt with just your income exceeds FHA published guidelines but I have seen AU approvals on FHA loans that are around where you would be.

I am not an FHA expert and do not have the handbook handy, perhaps someone else might have more insight. Regarding the student loans, I *think* FHA allows you not to include deferred debt in the ratios as long as you can document the deferrment is for another 12 months. If such is the case, removing the student loans from the calculation appears your income would qualify within stated guidelines depending on what rate they are qualifying you at. I am not exactly sure how they would view a disability forbearance. Removing the wife from the loan all together would get rid of her student loan but such manuevers may be subject to state restrictions.

If you get the doctor letter it would avoid any questions and make it easy on everybody, but I would say there are some viable alternative approaches.

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Oops, I was brain-dead yesterday when I looked at your ratios. Removing the student loans would not put you inside of published guidelines, but they would still be within often acceptable AU findings.

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Choiceworthy,

You have been right on all your assumptions for the disability requirements (same as Fannie Mae), and the student loans will be O.K. as long as each are not coming out of forebearance for twelve months.

Chatter,

The mortgage qualfication is going to be tight. At $30,000/year your will qualify for $1,025.00/month in total debt obligations. This leaves a housing expense, after your car payment of $800.00/month.

Do you have any information on taxes and insurance on the property. These are going to be very important figures to qualify. Also, what type of seller concessions are you getting? Are you using gift funds? Do you plan on using any of the savings?

Your deal will have to work out just right to make it work on your own income. What I mean by this, is it can work, but will take getting just the right pricing on a thirty year fixed mortgage, and this will depend very much on the lender and what type of closing costs the seller is paying.

One other possibilty is an FHA ARM. There are not many times I will tell someone an ARM is a good deal, but at 3.625% right now, they are attractive. This would let you qualify at 4.625% (actually 5.125% with the PMI) ) in the debt calculation, and may make the home affordable. An FHA ARM does not have as much payment shock when they adjust. They can only adjust one percent per year and five percent lifetime.

That is strictly a judgment call on your own, and you really need to ask yourselves what your prospective incomes will be in the future. The last thing I want to see is someone getting buried in a mortgage. Right now, you would not be including your wife's income. Next year at this time, (hopefully your wife will recover), there will be some financial decisions. Know how you plan on handling that.

I have an FHA ARM from about twelve years ago, and I have never gone above 6 7/8%, and I started at 4 1/2%, so it has been good for me. I wish I could guarantee you the same, it would make me feel better.

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I can not tell you guys how much all of your information has helped!

The taxes for this property are $500 per year. I am not sure about what the insurance will be. I think that our loan officer estimated our total payment on our application to be $863 - this includes taxes and ins.

The builder is going to pay $3000 of the closing costs. The remainder of about $1500 is going to be included in our mortgage. We are trying to do no money down - that would really help us out a lot.

I am giving my wife's doctor one last shot. This last time we never talked directly to him, it was his office and nurse practictioner. Thanks to you guys, I am a little clearer on what we need so my wife is sending a certified letter directly to the Doctor. Here is part of her request:

Social Security has already determined that I am qualified to receive benefits, and they will review my condition as often as they see fit. I am not asking for your help with continuing these benefits, I am just asking that you help provide the documentation that I need to purchase my first home.

I would like for you so send a letter to me stating that significant improvement from my present condition is not expected. I do not feel that this is unreasonable. You do not have to go into detail, just simply state when my injury occurred and that I will not experience a dramatic and full recovery. The underwriters for our loan mostly need to know that my condition will not suddenly change, causing my benefits to immediately cease.

We have been working with this doctor since my wife's accident, so we know him pretty well. Surely we can keep persisting until he can help us. He has already told my wife that she will not experience a significant amount of recovery in the future like she has in the past two years, so we are only asking him to state the facts. I think he was just reluctant to say that she is permanently disabled. We will see what happens.

We have wondered that maybe if we could re-finance our car in only my wife's name if that would help me, or if she could finance it and get another family member to co-sign instead of me. Then the only thing I would have is just my student loan payment.

I also am not against ARM.

If things with this house don't work out, then I guess we will just suck it up and go for a condo or townhome. That REALLY isn't what we want, but we don't want to keep shelling out rent. We can find a nice place for around 88K - 100K. I am sure that I could swing that on my own. We will see what happens. The house we are trying to get now though is perfect for us as far as location and convenience for my wife.

The thing that is so frustrating is that we KNOW we can handle the mortgage payment. We have been working toward this for years and we are ready. Now we just can't get the mortgage. I am pretty confident that my wife will continue to receive her disability when she gets her review next year, even if for some strange reason she doesn't, we aren't worried about coming up with the extra money.

Well... sorry for the long post. Again, I cannot express how much I appreciate your advice!

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The taxes for this property are $500 per year. I am not sure about what the insurance will be. I think that our loan officer estimated our total payment on our application to be $863 - this includes taxes and ins.

What interest rate have you been quoted? Since you are getting a new home, Is it already built or are you 90 - 120 days from closing? This can make a big diffference in inteest rate because of the length of time the loan would (could) be locked.

I am giving my wife's doctor one last shot.

Make sure there is something good in the needle if he cannot see the light. :lol:

The builder is going to pay $3000 of the closing costs. The remainder of about $1500 is going to be included in our mortgage. We are trying to do no money down - that would really help us out a lot.

Although a deal can be structured for no money down on an FHA loan, you will still need to prove a 3% cash investment. On a purchase price of $119,000, you will need to prove $3,570. Since you have $2,000, the additional $1,570 will need to go through a gift fund. Is this what you mean by "The remainder will be included in the mortgage?"

Debt ratios are not written in stone on FHA mortgages, and the estimates take you over the 41% limit. They can use compensating factors, but the student loans being deferred might weigh against any positive compensating factors. Really an underwriters call.

Well... sorry for the long post. Again, I cannot express how much I appreciate your advice!

That's not that long a post, and believe it or not, we learned something new here........Part of the planning on purchasing a home with someone who receives disability payments should be done right after the initial award of temporary disability. Do you sense something wrong with the system here?

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What interest rate have you been quoted? Since you are getting a new home, Is it already built or are you 90 - 120 days from closing?

I believe that the APR was right at 6%. The house is under construction and will probably be finished around the end of March. This is perfect, because our lease is up in March.

Although a deal can be structured for no money down on an FHA loan, you will still need to prove a 3% cash investment. On a purchase price of $119,000, you will need to prove $3,570. Since you have $2,000, the additional $1,570 will need to go through a gift fund. Is this what you mean by "The remainder will be included in the mortgage?"

We are using a "step-up" program where you don't have to contribute the 3%. http://www.ahfa.com/StepUp.htm We have also paid $500 down in earnest money on the house. We are building our savings just in case, and we could get gift funds if necessary.

That's not that long a post, and believe it or not, we learned something new here........Part of the planning on purchasing a home with someone who receives disability payments should be done right after the initial award of temporary disability. Do you sense something wrong with the system here?

If we had known this ahead of time, we would have had everything in place before we applied for the loan. Our LO was not aware at the time we applied that the SS was going to be an issue. I just found out that my aunt and uncle had the exact same problem when they bought their house about a month ago. My aunt is on disability for lupus, she finally had to get something from her doctor.

My thing is, why are they more strict when it comes to disability income? They don't know that I won't quit my job a week after closing. I guess they are worried that if the SS money is gone, the person might not be able to offset the loss of income.

This is so frustrating, because if we hadn't been in the accident (which was not our fault) none of this would be an issue. Because of her disability, our income has been cut in half. Luckily, we have been able to reduce our debt, but we have drained our savings.

Oh well, life happens.

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It looks like that stepup program sets the rate and terms, and only the only plan available is the 30yr.

The only thing I would add to the doctor letter is if you can get the doctor to specifically mention "significant improvement not expected within the next three years" or something of that nature. Underwriters can be real sticklers on that three year thing and are unwilling to make assumptions.

It is very frustrating for someone in your position but in the big picture their strictness helps keep the program solid enough to keep it available. You have the system to deal with on both sides, the loan and the income. The frustration does not double. It is squared!

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