I will respond to one thing the others did not. you made a HUGE mistake. You put in an offer on one house BEFORE you sold the one you have now. I would tell you to be financially safe you need to rent until you sell the old house. Otherwise you are likely to be making 2 house payments for years to come. The market is not one that guarantees you will SELL anything in a reasonably short time frame.

Please, withdraw the offer based on lack of getting a loan. Then after you have sold your house and have the cash in hand buy the next one then and only then. It is to easy for something to go wrong when selling a house to depend on it at least for now.

If you end up having a hard time paying rent and mortgage you can always go back to the house you have the title to.

It is entirely subjective based on the underwriter, however if both homes are in the same MSA (metropolitan standard area) you may be out of luck. You should definitely right a letter to the lender explaining your circumstances. Also, you may want to specify that your current house has equity in it (if in fact it does) so the lender knows you're not just scheming on buying a new home then dumping the old one:)

If it's going to be a short sale though I don't blame the lender for being cautious.

Try to have your loan office get your back on this one too.

If that doesnt work you can try another lender, because there is no "industry standard"
Good luck!

Thanks for the input guys- what is a 'occupancy letter'? And what is the true definition of in-house underwriters?...... the office we have been dealing with is in one city, but they said their underwriters are in another city (much bigger city) several hours away.

Caree,

I couldn't have answered it any better than Dan just did. You document the file with as much information as possible and write a strong occupancy letter. Having in-house underwriters helps with the communication on these types of situations.

Caree,

The reasonable commuting distance is open to interpretation. The hud website states that with a reasonable communing distance will vary depending on the area. For instance, its not uncommon for someone to live in south jersey and work in the philadelphia are (across state lines). The only think i can tell you is to document the communte from your house listed for sale to the new house. I would provide the distance and the estimated time of travel. IF you have to pay any tolls or stuff like that i would document that as well. i would write a letter explaining the area to the underwriter if they are not familiar with the area. Your appraiser may be able to help as well. i would also give a copy of the listing to the underwriter, if you havent already done so. Thats probably the best advice i can give...good luck. if you want my underwriter to look at it, i may be able to arrange that. thanks

Danny Castagna