This ARTICLE On Buying House After Selling Home With Late Payments Was PUBLISHED On August 8th, 2019
There are instances where a homeowner is behind on their mortgage payments and decide to sell their home.
- After they sell their home, their intention is Buying House After Selling Home With Late Payments on the home they sold
- Buying House After Selling Home With Late Payments on the home they sold can create an issue when qualifying for a new mortgage
- Homebuyers can qualify for a new mortgage with outstanding collections and charge off account
- They can qualify for a new mortgage with low credit scores
- However, all lenders want to see timely payments in the past 12-months by borrowers
- This holds especially true with timely mortgage payments in the past 12 months
In this article, we will cover and discuss qualifying for a mortgage after Selling Home With Late Payments on the homeowners’ previous mortgage. Qualifying for a mortgage After Selling Home With Late Payments in the past 12-months on a prior mortgage is possible with Non-QM Loans. A large percentage of our borrowers at Gustan Cho Associates are Non-QM Mortgage Borrowers.
Automated Underwriting System (AUS)
All government and conventional loan applications need to go through the automated underwriting system (AUS). There are three AUS FINDINGS:
- Approve/Eligible which means the AUS rendered an automated underwriting system approval
- Refer/Eligible which means the automated system cannot render an automated approval and VA and/or FHA loans needs to be downgraded to a manual underwrite
- Refer/With Caution which means the borrower does not qualify
Qualifying for a mortgage after selling home with late payments in the past 12 months is possible if the borrower can get an approve/eligible per automated underwriting system. One or two late payments is not always a deal killer. However, multiple late payments in the past 12 months will be difficult in getting automated approval per AUS.
Buying House After Selling Home With Late Payments On Prior Mortgage In The Past 12 Months
It is possible Buying House After Selling Home With Late Payments on the prior mortgage payments in the past 12 months.
- Borrowers who cannot get an approve/eligible per automated underwriting system (AUS) on government and/or conventional loans, they may qualify with Non-QM Loans
- Non-QM mortgages are portfolio loans offered at Gustan Cho Associates
Benefits Of Non-QM And Alternative Financing Programs
Here are the benefits of Non-QM Loans:
- There are no mandatory waiting period requirements after bankruptcy and/or housing event (foreclosure, deed in lieu of foreclosure, short-sale)
- There are no maximum loan limit caps on Non-QM Mortgages
- Late payments in the past 12 months are allowed
- 10% to 20% down payment requirement
- Bank Statement Loans For Self-Employed Borrowers where no income tax returns are required
- Credit Scores down to 500 FICO allowed
- No private mortgage insurance required
- Late mortgage payments in the past 12 months are allowed on Non-QM Mortgages
- Credit disputes during the mortgage process are allowed and do not have to be retracted
- No pre-payment penalty on owner-occupant Non-QM Loans
Non-QM Mortgage Rates are higher than government and/or conforming rates. However, since there is no pre-payment penalty, borrowers can use Non-QM Loans as a bridge loan until they can refinance it to a conforming mortgage. For more information about the contents of this article and/or other mortgage-related topics, please contact us at Gustan Cho Associates at 262-716-8151 or text us for faster response. Or email us at firstname.lastname@example.org.