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Old 04-12-2013, 01:05 PM
 
67 posts, read 175,409 times
Reputation: 54

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Got some very unsettling news last night. After going through the whole rigamarole to purchase a short sale we were all set to close. Our closing date was set for April 19, and our file had been approved through underwriting. We started with a conditional approval, with the only condition being that we provide a transcript of our recently filed 2012 taxes.

I actually got an email yesterday saying we are fully approved, and we were going to be able to close early (monday). Late last night I get an email from our mortgage advisor that the underwriter has revisited our file, and it has been suspended due to questions about employment stability. I am in sales, 100% comission, and have been for 5 years. I switched jobs 6 months ago, and this is apparantly what is causing an issue even though I am making on average 30% more per month that at my previous employer. My previous income at over 100k would be more than enough to qualify for the home we are purchasing.

My wife, a recent college grad, has had a 3 different employers in the past 18 mos, which is also apparently raising a red flag, but I'm unsure as to why. I am the primary bread winner for our family, and my income alone is enough to handle all of our debts, and still have a decent DTI.

So last night we wrote a bunch of letters explaining our employment history, reason for changes, and providing a monthly budget. This has all been sent back to the underwriter this morning.

I'm growing weary of this process, and very irritated that our loan would be conditionally approved, then approved, and now suspended less than one week from closing.

Is this a normal part of this process? Are issues like this commonly raised and resolved?

We are supposed to hear back by tonight, but I would sure like to ease my mind a bit in the mean time.
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Old 04-12-2013, 04:27 PM
 
3,541 posts, read 7,688,892 times
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It's more the Rule than the Exception these days. It sounds like the file went for a Compliance sign-off, or was sent directly to the Investor for review. The Investor is likely Well, Chase, BB&T, or another large bank you have heard of.

Lenders without certain designations, or with shallow credit lines, will send files to the Investor for a once-over, to ensure that they will be purchased, post sale.

It could also be that an Underwriting Manager went over the file at "pre-close" to make sure it looked good.

They are going to weigh your employment history, but not your income history. The will only look at earnings at the existing company. Bonus/Commission/Self Employed borrowers really get put through the wringer today.

As far as resolution, hopefully you have a strong Loan Officer who will learn the true Single Issue that is raising the Red Flag, and will be able to obtain letters from you, and the employer in question, to assert confidence in future and lasting tenure with the employer.
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Old 04-12-2013, 04:52 PM
 
67 posts, read 175,409 times
Reputation: 54
Thanks for giving me a clearer idea of what is going on. I took it upon myself today to have the owner of my company write a letter for me saying that I was recruited away from my previous employer (reason for job change), and that they plan to employ me for the foreseeable future (stability), and sent that to the mortgage adviser to forward on.
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Old 04-13-2013, 12:44 PM
 
67 posts, read 175,409 times
Reputation: 54
Wanted to update this and say that we are now "approved" again. Hearing it from my morgtage advisor, we apparently got the worst of the worst when it comes to underwriters. This lady apparently has a stack of complaints filed against her for issues much like ours.

The first call I got yesterday was that underwriting was requiring an additional $10,000 down to approve the loan. I have the $, and could have made the extra down payment, but refused for two reasons. The first was just the shear principle of it, the second being that that money is ear marked for other repairs/upgrades the home is in need of. Told my mortgage guy we had to have it approved as it was written.

Got a call back about 6pm stating that we were once again approved and good to go with our original closing date of April 19. I'm cautiously optimistic that we won't have any further bumps in the road, this has been quite the process, and I'm just ready to be done with it.
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