As the market teeters, some lenders face the difficulties of the constantly changing qualifications for FHA, VA and USDA loan requirements. People who may have been prequalified for any of these
Buyers FALLING OUT of QUALIFICATION after being QUALIFIED during Covid 19
Dated: May 6 2020
As the market teeters, some lenders face the difficulties of the constantly changing qualifications for FHA, VA and USDA loan requirements. People who may have been prequalified for any of these loan programs and went under contract on a home, may find the financing falling apart, no fault of their own.
This is devastating for both buyers and sellers and most importantly, causing other loan programs, such as the conventional loans to be more desirable and acceptable to keep deals together. It may also be a good idea for any sellers who anticipate putting their homes on the market to include the provision that they are only accepting offers from qualified buyers of conventional financing. Furthermore, it may be necessary to keep a home as an active - under contract to allow a seller to accept back up offers incase the first falls apart.
Bain Ayres of Cedar Mill Mortgage adds that there are many overlays that would lower the debt to income ratios and many companies aren't doing manual underwrites. That being said, it is that way for all government loans. All government loans are problematic and not priced as well as they should be. Many lenders have increased their minimum credit score requirement to 640 or above.
That is a vast difference from the minimum, 580 score, causing many buyers who were originally qualified to fall out of the qualification during the buying process. This is causing many homes that were once under contract to come back on the market.
Having a professional agent and lender that you can turn to in these questionable times is more important now, than ever before. Always stay in contact with your lender and agent and ask them if your deal is solid along the way. In this everchanging market, things change from day to day. You will want to keep in touch with those on your side.
Mortgage information given, compliments of:
Bain Ayres of Cedar Mill Mortgage
Nancy Gorrow of Atlanta Communities / Buyers Dream Home Group
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