Finally got Conditional Approval!? Could it be? (loan officer, 2013, credit report)
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Just logged into my online account to see if there were any status updates from Underwriting (I usually check at least a couple times per day) and noticed it changed from "Loan Approval Status: In Process" to "Loan Approval Status: Conditional Approval"!
We had 12 conditions that were previously "Under Review" that now show as "Completed". There are still a few conditions that show "Required" but they are related to thinks like "Provide 2013 Tax Return" and stuff that needs to be done prior to Closing.
They do also want to know about an unsufficient funds fee on a bank statement but that's an easy explination letter, so I think we should be good to go!
Once we sign the "Conditional Loan Approval" document (which is one of the required conditions still needed to be met), can they still continue to add conditions or it's a done deal (assuming nothing changes on our end credit wise between now and closing)?
Last edited by SelfEmployed75; 01-03-2013 at 07:14 PM..
I knew I shouldn't get excited too early...it's nothing bad yet, but that "Conditional Approval" status change is just something that it says when it comes back out of Underwriring with additional conditions. Once you provide the new conditions, the status will change back to "In Process". From what I understood, if they need more stuff, it'll change back to "Conditional Approval" again. Once they don't need any other conditions, it will change to some other status I guess.
The 'conditional approval' means that based on what you told them and your credit profile, your loan should close. Now you just have to prove it..
Its not as scary as we think. Its time consuming and sometimes frustrating but if you got a conditional approval its highly likely your loan will close. Hope this helps
I'm stressing about the LOE to explain the NSF fee. Basically, due to a judgment, there was a hold placed on my bank account which caused an online payment that was already scheduled go negative and I was charged an insufficient funds fee. I have since setup a payment plan for the judgment so it's being handled, and I told the loan officer about it and even sent them the payment agreement so they should be aware of it, but what if the underwriter doesn't know about it? The payment is included already on the loan application and in the monthly debt-to-income ratio. It doesn't however appear on my credit report.
Guess I'll see what the Underwriter says, it's the last thing I'm worried about, unless they ask for some other condition that I'm not anticipating.
It really depends when the house is ready. For new construction, you need to be prepared for two full underwriting processes, and here's why: Your credit documents have a limited shelf life. Your credit report most likely is only valid for 90 (maybe 120 days). In your "loan commitment" there should be a date the documentation starts to expire. So while your loan approval should hold up provided nothing changes: your deposits continue from your self employment, your bank statements are relatively the same and your new credit report doesn't reflect new debt and so on and so on. When you have your pre-drywall meeting with the builder, the lender will start to update your file and order the appraisal. It will feel like they have never seen your file before - they will need to re-acquaint themselves with it and make sure you are ready for the second loan submission........like make sure they have a copy of the options check you gave the builder and the statement showing it clearing and so on. Get yourself a big expandable file.......put everything in there......copy every check you deposit that is not payroll......don't make any unilateral decisions if you aren't sure of something. Call your lender first. You'll be fine.......but you do get to repeat the process.
Haven't received a "loan commitment" but from the sounds of it, that's the paper I'm looking for so I can finally consider that we are "good to go" pending nothing changes, like you outlined. We're not quite at that step yet...I submitted the LOE for the insufficient funds fee and got an email reply back saying "This will work fine" so hopefully the LOE is good.
The loan processor also asked if we will be savings the funds for closing over the next few months and I told him that we already setup a monthly payment plan to make deposits as part of the sales contract with the builder, so now we have to submit our bank statement every month so they can see the deposit checks clreaing. It'll be a glorious day when this whole process is over and hopefully we will be in our new home.
I followed up with the Loan Processor this morning on the letter of explanation for the insufficient funds fee and he says "We have everything we need from you, we have approval so we're good to go." I got all excited of course then asked "What happens next?" to which he says "I'm going to send the file back to Underwriting and that's is until it gets close to closing when we'll need updated bank statements and credit report." Of course the part of "back to Underwriting" caught my attention so I asked why it's going back there, and he said to review the letter I sent.
How are we "good to go" and "approved" if they still have to review the letter?
I actually asked that "Could the insufficient funds fee and the letter be a problem?" and he said that it won't be, it's just standard procedure that they have to ask for a letter whenever there is an NSF fee.
Being the way I am, I am still very skeptical of course. I logged into the online portal to check on the status of the loan and it still shows "Conditional Approval" and the letter of explanation for the NSF fee changed form "Required" to "Pending Review". I guess once that changes to status "Completed" I'll finally be able to relax a little, I hope.
Spoke with the loan processor again this morning and asked about the LEO for the NSF fee. He said he sent it back to UW for "verified credit approval" and it should be back out by end of next week. He didn't forsee any problems with the LEO, said it's more of a formality that they have to ask, but UW does need to review it.
He said the "verified credit approval" is the last step in the process for now, which is as final of an approval you can get until it's actually time to close. The next time we would be in touch is 30-45 days from closing when they need updated bank statements, credit report and W2s (or taxes/P&L in our case).
If anyone is following along...we got our "Approval" today!
I logged into our online loan account and saw that the "Loan Status" changed from "Conditional Approval" to "Approved"! We are supposed to close in June, so they will need updated bank statements and credti report at that time but I'm super excited! Holy crap!
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