Mortgage Late Payment Guidelines In Past 12 Months

In General, You Can Have Prior Bad Credit And Get Qualified For A Mortgage As Long As You Had Timely Payments In The Past 12 Months

This Article Is About Mortgage Late Payment Guidelines In Past 12 Months

You can have prior bad credit, outstanding collections, charged-off accounts, and late payments and get qualified for a mortgage as long as you have been timely in the past 12 months on all of your monthly debt payments. Lenders understand you can have prior bad credit due to extenuating circumstances. However, lenders want you to get reestablished and show that you can now pay your bills timely. Most consumers will go through tough financial times due to divorce, unemployment, health issues, or other extenuating circumstances. This holds true even for financially responsible people. However, most people do recover and re-establish their credit. Therefore, it is alright for you to go through tough financial times. However, timely payments in the past 12 months are key in getting an approve/eligible per automated underwriting system (AUS).

The Key In Getting An Approve/Eligible Per Automated Underwriting System Is Timely Payments In The Past 12 Months

What is the key to getting an approval / eligible automated risk assessment system is timely payments in the last 12 months

Mortgage Late Payment Guidelines In Past 12 Months states that borrowers can qualify for a home loan as long as they get an approve/eligible per automated underwriting system. However, many lenders have overlays on Mortgage Late Payment Guidelines In the Past 12 Months. Lender Overlays are additional lending guidelines imposed by individual lenders. All borrowers need to meet minimum FHA, VA, USDA, Fannie Mae, and/or Freddie Mac Agency Guidelines. However, lenders can have additional guidelines that is above and beyond agency guidelines called lender overlays. All agency Mortgage Late Payment Guidelines allow AUS to get an approve/eligible depending on borrower’s overall credit and income profile. However, even with an approve/eligible per automated underwriting system, lenders can say no. The great news is that Gustan Cho Associates Mortgage Group has no overlays on government and conventional loans. We just follow Mortgage Late Payment Guidelines and have no additional overlays. If borrowers can get an approve/eligible with mortgage late payments in the past 12 months, that is what we go by. 

Home Loan With Bad Credit

Home buyers can qualify for a mortgage with prior bad credit. The key word here is PRIOR. Outstanding collections and charge-off accounts do not have to be satisfied to qualify for a mortgage with lenders with no overlays. Gustan Cho Associates Mortgage Group has no overlays on government and conventional loans. However, all lenders want to see timely payments in the past 12 months. On manual underwriting, lenders want to see timely payments in the past 24 months. Borrowers can have higher credit scores and great debt to income ratios but may not get an automated underwriting system approval if they have a lot of late payments in the past 12 months. Late payments on a mortgage in the past 12 months are considered very serious. However, Gustan Cho Associates have helped countless folks with mortgage late payments in the past 12 months. We will discuss getting borrowers approved with mortgage payments in the past 12 months. Worst-case scenario, we have alternative non-QM loan programs that borrowers can qualify as a bridge loan.

Moving To New Home After Selling Prior Home With Late Mortgage Payments

There are instances where homeowners just sold their current home and need to qualify for another home purchase.

  • However, the homeowner had late payments in the past 12 months on the exiting property.
  • They have fully paid off the mortgage on the home that sold.
  • So there is no mortgage balance.
  • However, there are late payments reporting on their credit report in the past 12 months.
  • They qualify with credit scores, income, and have plenty of down payment and closing costs.
  • Will the late mortgage payment in the past 12 months affect them qualifying for a home loan?
  • The answer to the above case scenario is YES.

Prior Bad Credit Is Alright As Long As You Have Timely Payments For The Past 12 Months

Do you have timely payments in the last 12 months

Lenders want to see timely payments on all bills of the borrower in the past 12 months. This holds especially true with a mortgage payment. The late mortgage payment in the past 12 months may affect them qualifying for a new mortgage on their home purchase on government and/or conventional loans. It all depends on what the automated underwriting renders. It is very possible to get an approve/eligible per automated underwriting system with one or two late mortgage payments in the past 12 months. If the file gets a referred/eligible per AUS, then the only other option for the borrower is to qualify with a non-QM mortgage. Manual underwriting is out of the question. This is because manual underwriting requires 24 months of timely payments. We will further discuss financing with non-qm mortgages with recent late payments.

Mortgage Late Payment Guidelines: Solutions Qualifying For Home Loan With Late Payments In Past 12 Months

Borrowers can qualify for home loans with mortgage late payments in the past 12 months with automated approval.

  • Fannie Mae DU AUS is the most common automated underwriting system loan officers use
  • If you get a refer/eligible per AUS with Fannie Mae DU, have the loan officer try Freddie Mac LP AUS
  • There are many instances where Freddie Mac will render an approve/eligible per AUS when Fannie Mae will not

If this does not work, borrowers may have to wait until the mortgage late payment seasoned. Or they may try to go with non-QM loans.

NON-QM Mortgage Late Payment Guidelines With Recent Late Payments

Home buyers who cannot wait for the mortgage late payment to season can try to qualify with non-QM loans.

  • NON-QM Loans is a portfolio loan program Gustan Cho Associates Mortgage Group offers
  • Late payments in the past 12 months are allowed on non-QM loans
  • 10% to 20% down payment is required. Amount of down payment depends on borrowers credit scores
  • Mortgage Rates are slightly higher than government and conventional loans
  • Mortgage rates depend on the down payment and borrowers credit scores

There is no maximum loan limit. There is no private insurance required. There is no pre-payment penalty on non-QM loans so borrowers can refinance it at a later date when they qualify for government and/or conforming loans. 

No Lender Overlays On Mortgage Late Payment Guidelines

What are the mortgage late payment guidelines?

Borrowers with mortgage late payments in the past 12 months needing to qualify for a mortgage with a direct lender with no overlays, please contact us at 262-716-8151 or text us for a faster response. Or email us at [email protected] We are available 7 days a week, evenings, weekends, and holidays. We are also experts in alternative financing. We handle countless non-QM loans and bank statement loans with no income tax returns required.

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