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gododgers

FHA Loan approval?

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Hello guys,

 

We are applying for an FHA mortgage, and we have an old second mortgage on our credit for almost 70k that was charged off back in 2012 on there. The lender we are talking with is asking about it, and if we are paying on it. I told her that we are not, and have not payed anything on it since before the house was foreclosed on. As it stands now, the second mortgage is out of the SOL, so I am legally covered, but I am curious if this being on my credit will preclude FHA loan approval?

 

Also, they provided me with a credit report they pulled from Credit Technologies Inc, and there is a page with a "Level one decision, score (model B)," does anyone know what this is, and what the score means?

 

Thanks guys.

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On 5/28/2016 at 9:19 PM, gododgers said:

As it stands now, the second mortgage is out of the SOL, so I am legally covered, but I am curious if this being on my credit will preclude FHA loan approval?

They MIGHT approve you but I would not get my hopes up.  70k on a defaulted mortgage (even if the SOL is expired) still counts towards the debt to income ratio since it can report for another 3 years.   That is A LOT of money to ask the underwriters to over look.

On 5/28/2016 at 9:19 PM, gododgers said:

Also, they provided me with a credit report they pulled from Credit Technologies Inc, and there is a page with a "Level one decision, score (model B)," does anyone know what this is, and what the score means?

It is likely proprietary to Credit Technologies and merely indicates what scoring model they used to make their decision.  Only they can tell you what it means.

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On 5/28/2016 at 9:19 PM, gododgers said:

 

Also, they provided me with a credit report they pulled from Credit Technologies Inc, and there is a page with a "Level one decision, score (model B)," does anyone know what this is, and what the score means?

 

 

It basically means that it's a "Refer." It has to be manually underwritten since it does not fit the mold for an automated decision.

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