Yes, the lender is using that terminology, but not USDA. The key here is that it is not USDA guidelines....it's the lender's personal guidelines. Apparently they have their own rules which are called an "overlay" which you have to pass through before going through USDA. Our mortgage specialist stated that she was never told this - she was upfront with the lender the whole time, and they kept telling her everything was fine, but then when they found out the deed was still in our name, they changed their tune. It took them a week to decide if they were going to accept a deed-in-lieu, and they came back with the two year thing. Until today she has never heard this from this lender before.
Our mortgage specialist is putting some feelers out to see if she can find a lender with less strict guidelines. She said that if we can find a lender who will allow this, she is certain the USDA will approve the loan. She believes there is a lender out there, but it's just a matter of finding them.
Applying for USDA - No Money Down Rural Housing Loan
Started by
doodlebugger
, Aug 13 2012 08:12 PM
29 replies to this topic
#26
Posted 27 August 2012 - 10:36 AM
#27
Posted 28 August 2012 - 09:42 AM
Okay, so here is another thing that I found under USDA eligibility criteria - we can have another home in our name and still get approved if we can show that the house is not "structurally sound, functionally adequate". Again, I know it's possible that the lender will have an overlay rule likely to combat this, but I am willing to see if this is an angle we can use to get out of here. The house we live in has all sorts of problems - I am pretty sure we could get an inspector to document that it's not structurally sound and has some major problems....particularly with our foundation. But, again, maybe I am just grasping at straws since the lender has to be the one that we have to get through first........how does one find a lender and get answers about what their underwriting requirements are??? I'm getting impatient waiting on our mortgage specialist.....she doesn't seem all that interested in helping us anymore and she doesn't seem to have a lot of lenders in her contact list.
#28
Posted 31 August 2012 - 10:04 AM
Just giving an update. We consulted a lawyer who advised us to do a quit claim deed and have dh removed from the mortgage. The mortgage broker/specialist whatever she was, couldn't get any of her three lenders to even accept an application from us, so we started calling lenders on the USDA list. We found a lender who said that he wanted us to get our score up, but he says that he is pretty sure that it will work out if the USDA said they would accept it. He said he would take no lower than a 640. Unfortunately, right now our midscore is probably in the 630 range, but we are getting ready to pay some stuff off. Our FAKOS are in the 650-670 range, so this was a little surprise when we had the midscore of 630. Going to try for some bumpage to get rid of some of the inquiries using smartcredit and usaa credit monitoring thing. There are quite a few things falling off in the next month too, so my big question is now....how long should we wait for the scores to be updated after the stuff falls off and the items are paid off at the beginning of the month (September)?
#29
Posted 31 August 2012 - 11:12 AM
Is the lawyer really advising that you quit claim your husband from the mortgage? Because he can't be removed from the mortgage. The quit claim removes him from the deed to the home. I'm guessing you just used the wrong word there, right? If not, ask the lawyer again.
Who are you deeding the house to, the bank? Aren't you afraid you'll be evicted as soon as you do it? Once you do that, the bank won't have to go through foreclosure to initiate eviction proceedings. I don't know how long that takes in your state, so you'd have to double check with your lawyer on that. It would just put you in a terrible place if your new loan isn't approved, and now you're being evicted from this one.
Who are you deeding the house to, the bank? Aren't you afraid you'll be evicted as soon as you do it? Once you do that, the bank won't have to go through foreclosure to initiate eviction proceedings. I don't know how long that takes in your state, so you'd have to double check with your lawyer on that. It would just put you in a terrible place if your new loan isn't approved, and now you're being evicted from this one.
#30
Posted 31 August 2012 - 12:16 PM
Oops....that was a typo. I mean quit claim from the deed. The house stayed in my name because I'm not going to be applying for the new mortgage. The lawyer said that things will just proceed as usual with the foreclosure. This doesn't really change anything as far as the bank is concerned because they still have to go through with the foreclosure before getting the deed turned over. Nothing is happening right now. There is no sale date. I talked to the bank today and they said that they are "reviewing our file" still from the last round of paperwork they requested because they keep asking us to fill out HAMP paperwork. Everything is going to boil down to timing on this thing. We are preparing to move out of the house by getting a storage unit next week and packing up non-essentials. After that, we will just wait it out and keep attempting to find a temporary rental house. The next month or two will be interesting to say the least.
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