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I heads from the loan officer at bbt yesterday that my loan was approved pending private mortgage insurance approval. What exactly does this mean? Is it an easy process to get mortgage insurance approval? The loan officer said he never heard of this before. That really wasn't very reassuring. Has anyone had experience with this? Any help would be greatly appreciated. Thanks
First, if your loan officer has never heard of it, then I'm afraid I've got some bad news. Your Loan Officer sucks. Or has been in the business for about an hour. Which also sucks. But at least you're at the tail-end of the process.
Banks fully underwrite files, and for those Conventional loans that require private mortgage insurance, the fully-approved file goes to the mortgage insurance company, (MGIC, Radian, etc.), whereupon THEY underwrite the file. Usually comes out fine - as long as the lender you are dealing with knows what to expect.
MI companies are sensitive to debt ratio, and typically need firm documentary support within the file. It's part of the "I thought I already sent that" syndrome, but it's actually them asking for something more specific.
Hmm well I has assumed the loan officer at the bank had a lot of experience. Also my realtor had never heard of this either. Perhaps it's because my due diligence period was ending soon and that's why they have this kind of update? Maybe the loan usually isn't approved until after this step but they knew time was running out for me so they gave somewhat of a conditional approval? I dunno,, this is just my brain storming but I don't really know much about it.
So is it possible that they may ask for more paper work? Can a loan ever be denied at this point due to the mortgage insurance approval. How long does approval usually take? I'm trying to close on June 16 and really won't be able to rest easy until I get a full approval.
Can anyone answer the questions below for me please?
Quote:
Originally Posted by hkrn44
Hmm well I has assumed the loan officer at the bank had a lot of experience. Also my realtor had never heard of this either. Perhaps it's because my due diligence period was ending soon and that's why they have this kind of update? Maybe the loan usually isn't approved until after this step but they knew time was running out for me so they gave somewhat of a conditional approval? I dunno,, this is just my brain storming but I don't really know much about it.
So is it possible that they may ask for more paper work? Can a loan ever be denied at this point due to the mortgage insurance approval. How long does approval usually take? I'm trying to close on June 16 and really won't be able to rest easy until I get a full approval.
Yes it is possible for them to ask for more paperwork. Yes it is possible, but not likely, that they would issue a decline.
A lender can issue a Full Approval Contingent upon obtaining Private Mortgage Insurance. But, you are a month from closing.
If you are closing a month from now, you will have to be sent back through both the Lender and the MI company's Underwriters, albeit rather brief, so that they can inspect paystubs to be received between now and then, perform a soft credit check to see if you've bought a boat or something that might imbue your creditworthiness, and perform a verbal verification of your employment.
What is the price of the home, how much are you putting down, and what is the nature of your income and employment?
My closing is June 16, but now I may move it up if I can get out of my apt lease early due to the ac not working and them refusing to fix it. I'm buying a 149,000 house and paying 5% down. I'm a full time nurse & have been for 8 years. so I have a steady income. I'm moving 2 months earlier than originally planned so I won't really have all the extra back up money that I would have if I had 6 more paycheck a before closing rather than 2.
Nurse income is awesome. Y'all tend to have excellent credit as well. 5% Down is the tightest a Conventional Loan can be. But your income and time on the job sound good. I don't have any data on your Debt Ratio - that's a big player in these things.
MI review usually takes a day, 2 max, especially mid-month. Check in with your Lender for an update at the end of the day. Hopefully by this time tomorrow they will be preparing Closing Docs!
I don't have any car payments or student loans. My only debt is $700 on a medical credit card used for dentja purposes and $1500 on a credit card that I usually pay off every month. I wasn't able to pay it off this month bc I'm hoarding all my money for the down payment. But as soon as the house is paid, loan approved, and I close ..then I will pay that card off.
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