I"m looking to close 11/7 my lender say's I need 1 non traditional credit. which I don't have.Can I still move forward?I have 2 forms

Asked by Celete Prevost, East Stroudsburg, PA Thu Oct 27, 2011

of traditional. I have rental history, Car payment. I have a credit card of 6 months. Absolutely nothing more than that. My credit score is good. Can a lender help me to close based on this?

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Jessica Nooney’s answer
Jessica Noon…, Agent, Medford, NJ
Thu Oct 27, 2011
Celete,

I am so sorry that your experiencing these issues so close to closing. Mary asked the question that was first and foremost on my mind - how did this not come up sooner? I just went through a similar experience with clients and I was told that if you are purchasing a home through FHA financing you need three open tradelines on your credit report. My understanding is that you can use non-traditional credit lines (some are listed below), but you MUST show three lines of credit - this is an FHA guideline and to my understanding, no way around it.

Determine what additional non-traditional forms of credit FHA will accept and go from there. Another option may be adding a co-borrower to the loan. In any case, any decision you make or any options available to you should be discussed in detail with your agent and/or attorney and lender as soon as possible. You will need to know how the decision will make will affect you now and in the future.

Best of luck to you! I hope it all works out!

Sincerely,

Jessica E. Nooney
Weichert Realtors
(609) 654-8633 Ext. 121
(609) 276-8183 (CELL)
(609) 479-5333 (Direct Fax)
jnooney@weichert.com
http://www.yourjerseyrealtor.com

Winner of the 2010 NJAR Circle of Excellence Award
Winner of the Weichert Million Dollar Club - Sales/Marketing
0 votes
Mary Petti, Agent, Edison, NJ
Thu Oct 27, 2011
Thanks to Jim and Eric for clarifying the term non-traditional credit.

I thought utilities, insurance, or phone bills would count, but I was a bit confused by the question and started to question myself as to what I thought this type of credit was.
0 votes
Jim Simms, Mortgage Broker Or Lender, Louisville, KY
Thu Oct 27, 2011
You should have car insurance, no utilities where you rent?
0 votes
R. Eric Axel…, Agent, Sewell, NJ
Thu Oct 27, 2011
Celete,

Your rent payments should count as a non-traditional form of credit. You will need what's called a Verification of Deposit or 12 months cancelled bank checks. Other sources which you may not even be aware you have are as follows:

Letter of credit from utility company (electricity, water, telephone, gas, cable tv)
Insurance payments (life, medical, auto, renter's)
Child care, tuition
Internet/Cell phone bill

Speak about these to your mortgage broker and if for whatever reason they are unable to help, please ask your Realtor or, if you don't have one, me for references to other mortgage brokers who can.

Best of luck to you and congratulations on your purchase!
Have faith that it will all work out as it was meant to be.

Eric
Web Reference:  http://kurfiss.com
0 votes
Mary Petti, Agent, Edison, NJ
Thu Oct 27, 2011
Celeste,

Just curious but how did you get this far in the process (pre-approval, mortgage application etc) moving towards a November 7th closing, and the bank not tell you prior to this about the need for 1 form of non-traditional credit as a pre-requisite for the mortgage approval?
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