Underwriting absurdity (lease, mortgage, credit)

[va_newbie]

So I have been through underwriting hell this past week for my FHA loan.

First they delayed reviewing any of my responses to their conditions because the IRS was taking forever to send them our 4056 information for my taxes. They finally get it Wednesday night leaving them only 1 day in order to finalize the loan for my closing on Friday morning. (Keep in mind that they have had our loan for over a month and always had an excuse as to why it was taking so long for the underwriting.)

Then on Thursday the underwriter decided to leave early and apparently nobody else at the bank would be able to look at the remaining conditions until Friday morning, which was when we were supposed to close. None of the remaining items were odd, they just wanted to see updated bank statements, proof that the deposit check cleared, and a couple of other small things. Needless to say I was able to delay the settlement until 6 pm to give them time to approve to close and then get the paperwork for us done. Every condition was approved w/ the exception of a new one, which is baffling the heck out of me and I have no idea how they expect us to answer this.

I would appreciate any thoughts on this request from our underwriter.

So basically I wrote off my tuition for my grad school as an "unreimbursed expense" for the past two years as it was related to my work. I finished my school in Winter of last year and walked this spring, so I will no longer be claiming this on my taxes. FHA requires the underwriter to factor in the adjusted gross income in determining my qualification for this loan. The AGI puts me barely below the qualification for the loan and now our underwriter wants me to get my company to write on company letterhead that I will no longer have anymore unreimbursed expenses.

There is no company in the world that would certify that one of their employees will never have any unreimbursed expenses in the future. How can a company predict that I will never go back to school? They simply cannot. Our underwriter will not budge on this matter and refused to close my loan today, which is now going to cost me A LOT of money in delays, as well as risking me being homeless as my lease is running out on Monday night.

The loan officer will try and go over the underwriters head on Monday morning, but I don't know if it will work.

Does anybody have any suggestions on what I can do?

[weezycom]

Put a few of waffle words in the letter from the employer: "The company has no current plans and no contemplated plans for this employee to have any unreimbursed work-related expenses in the future."

[CAROLC]

I have having the same problem right now, except my loan is USDA. I had unreimbursed employee expenses in 2009 and 2010 so they are subtracting that from my gross for the last two years. Then they asked if this would continue and I said not. They asked for my employer to write a letter on company letterhead stating this. So my employer did exactly that stating that I had been reimbursed for all work related expenses since January 1, 2011 and that I would continue to receive reimbursement for work related expenses. They also noted on the letter that I receive a meal allowance of $21.00 per day for each day I work and this money is put in a expense account available to me when needed.

Ok, our loan was at USDA last week and they requested our complete tax returns with schedules again. Then today we heard from the Mortgage company that USDA is going to give us credit for 2009 $500.00 and $600.00 for 2010. But this still will put our debt ratio way out there. So now we have been building a house since April and was suppose to close July 29, 2011. The mortgage company said they have requested a VOE from my employer and it will depend on how the income will be averaged because now we are looking at being denied. I don't know what they expect to see because they already have current paystubs with YTD income, past tax returns since 2007, and W2s for the last two years. So my employer is only going to verify what they already have. I am at a complete loss because if USDA would have accepted the letter to know the unreimbursed business expenses would be continue after last year then we were fine. We had already been preapproved back in March and they ordered tax transcrips and did not say a word about any of this. They had my income exactly what is was for the last couple of years and I was fine. They did not deduct anything and did not tell me this would be deducted.

I am waiting now for the final word tomorrow but I feel like its already been answered, I just don't see how getting the VOE is going to make a difference since they already have all of the other documentation with my income. I know FHA does the same thing so we will not be able to go with that loan and with conventional we would have to pay a large down payment which we do not have. We had already put $6000 down in earnest money on the new house we are building when we signed the contract. I just wish somebody had of told us about this back in March so we could have been prepared and had a backup plan.

Anyway I just wanted you to know that you are not along in the underwriting nightmare.

I wish the outcome tomorow would be different but I just have a bad feeling.