Posted: 20 Apr 2011 04:28 PM PDT
Here are the additional underwriting guidelines for those with a 600-639 credit score with this lender:
The property must be a single-family residence, condominium or PUD. The following property types and loan purposes are ineligible:
o 2-4 unit properties.
o Build-on-own land transactions.
o Loan amounts greater than $417,000.
• Maximum ratios for loans receiving a Total Scorecard “refer” response – 31/43.
• Borrowers may not have had any short sales, “settled for less than amount owed,” public records, judgments, bankruptcies, foreclosures or tax liens in the most recent three years.
• Borrowers may not have had any collections, other than medical, in the most recent 12 months.
• Borrowers may not have had any 30-day late payments on mortgage, rent or installment debt in the most recent 12 months.
• Borrowers may not have had more than one 30-day late payment on revolving debt in the most recent 12 months.
• Cash-in-hand for cash-out transactions is limited to $25,000.
• Overtime, bonus, second job, income from part-time employment, commission income and self-employment income may not be used to qualify unless the borrower has at least a two-year history of receiving the income. The two years must be consecutive years of employment, but employment with the same employer is not required.
• Gifts may not be used to pay down or pay off revolving or installment debt for qualification purposes. However, gifts, grants, eligible down payment assistance programs and/or loans from family members are permissible sources of funds to close on a purchase transaction, subject to all FHA requirements and [Lender] overlays.
• Non-occupant co-borrowers are permitted, provided the occupying borrowers qualify without the non-occupant borrower’s income at ratios of 35/45.
• Loans for borrowers with credit scores below 640 may now be submitted under the Check-and-Close underwriting channel.
• All other FHA requirements and [Lender] overlays apply.