Home Buying in 78501>Question Details

Firstimer, Home Buyer in 78577

My app. is on its way to the underwriter. I have a few overdraft charges on my bank statement, will this be enought to deny the loan?

Asked by Firstimer, 78577 Thu Sep 2, 2010

My credit score is 685 and my debt ratio is "really good" according to my loan officer. His only concern is the overdrafts, although they were taken care of immediately. With times the way they are now, I'm really worried. Stressing out, so any info. ( good or bad ) will at least prepare me for good or bad news. Thanks.

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Answers

7
As long as it doesn't look like a monthly habit or frequent occurance you should be fine. I have only seen just a few loans ever be denied for something like this. If it comes up as an issue, as long as you have compensating factors to balance it out I wouldn't think their will be any problems.
0 votes Thank Flag Link Mon Sep 20, 2010
Overdraft happens to everybody so I would not worry. It is a good idea to write the reasons why it happened and how are you planning to correct that from happening in the future. If that underwriter does not value your 685 points, look for more options.
0 votes Thank Flag Link Mon Sep 20, 2010
It is all up to the underwriter an their decision if just had a few probably not an issue HOWEVER if you have over 5 they might be concerned.

DISCLAIMER: No on can truly render an opinion on the subject matter unless all files are reviewed.

Good luck

Lynn911 Dallas Realtor & Consultant, Loan Officer, Credit Repair Advisor
The Michael Group - Dallas Business Journal Top Ranked Realtors
972-699-9111
http://www.lynn911.com
0 votes Thank Flag Link Fri Sep 3, 2010
I think that as long as you have sufficient funds in your account now, and you provide an explanation you should be okay. Talk to your loan offer, they'll be able to assist you with the explanation letter.

Best of luck to you!
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0 votes Thank Flag Link Fri Sep 3, 2010
Firstimer,

You should include a good letter of explanation for those overdrafts with the underwriting package because the probability of the underwriter not noticing those are slim. When it comes to underwriting you have to be proactive. A good letter of explanation should state the following:

1. You are aware of the problem
2. Reason why it happened
3. You are sorry that it happened
4. Why It won’t happen again

Be brief, don’t open the door to more questions and be sure it makes sense.
0 votes Thank Flag Link Fri Sep 3, 2010
The may ask you for a letter of explanation for them, depending on the reasoning and the total picture of your other financials such as payment record for your other debts, it may or may not affect you. You should ask your loan officer for guidance, they will be able to etll you if it will affect you and what you need to do to write the letter of explanation if required.

good luck with your loan
0 votes Thank Flag Link Fri Sep 3, 2010
do you have a reasonable excuse for the over drafts?

did you let your overdraft protection cover you for convenience?
0 votes Thank Flag Link Thu Sep 2, 2010
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