Texas Mortgage Approvals With Late Payments Policy

TEXAS MORTGAGE WITH 30,60,90,120 DAYS LATE PAYMENTS!

Texas Bad Credit Mortgage Cash OUT Refinance UP To $500K TEXAS BAD CREDIT MORTGAGE LENDERS


Popular Texas FHA Mortgage Lenders Bad Credit Topics Include:

Bad Credit Texas FHA Manual Underwrite!

If you have late payments on your credit report chances you will need an FHA manual underwriting approval. Within we have outlined the Texas FHA mortgage lender approval process for manual underwriting FHA Texas FHA mortgage lenders loans with late payments reflected on the credit report.

Bad Credit Texas FHA Lenders must analyze the following

  • FHA mortgage applicant’s creditworthiness:
  • Credit Payment history;
  • Liabilities; and
  • Attitude towards Debts reflected on credit within the last 24 months. 

The maximum allowable qualifying ratios for FHA Texas FHA mortgage lender applicants with minimum decision credit scores of 580 or more provided they meet one of the compensating factors specified below are as follows:
 total monthly Texas FHA mortgage lenders payment may not exceed 37% of gross effective monthly income; and
 total monthly fixed payment may not exceed 47% of gross effective monthly income.
Acceptable compensating factors are limited to the following:
 Verified and documented cash reserves that equal or exceed three total monthly Texas FHA mortgage lenders payments (one and two units) or that equal or exceed six total monthly Texas FHA mortgage lenders payments (three and four units);
 New total monthly Texas FHA mortgage underpayment is not more than $100 or 5% higher than previous total monthly housing payment, whichever is less, and there is a documented twelve-month housing payment history with no more
than one 30 day late payment. In cash-out transactions, all payments on the Texas FHA mortgage lenders being refinanced must have been made within the month due for the previous twelve months.

The maximum allowable qualifying ratios for FHA Texas FHA mortgage lenders applicants with a minimum decision credit score of 580 or more provided they meet two of the compensating factors specified below are as follows:
 total monthly Texas FHA mortgage lenders payment may not exceed 40% of gross effective monthly income; and
 total monthly fixed payment may not exceed 50% of gross effective
monthly income. Acceptable compensating factors are limited to the following:
 Verified and documented cash reserves that equal or exceed three total monthly Texas FHA mortgage lenders payments (one and two units) or that equal or exceed six total monthly Texas FHA mortgage lenders payments (three and four units);
 New total monthly Texas FHA mortgage payment is not more than $100 or 5% higher than previous total monthly housing payment, whichever is less, and there is a documented twelve-month housing payment history with no more than one 30 day late payment. In cash-out transactions, all payments on the Texas FHA mortgage lenders being refinanced must have been made within the month due for the previous twelve months.
 Verified and documented significant additional income that is not considered effective income; and

Compensating factors to get your loan approved!

The table below describes the compensating factors (and the documentation required to support the compensating factors) that may be used to justify approval of manually underwritten loans with ratios that exceed FHA
standard qualifying ratios.
Verified and Documented Cash Reserves

  • Minimal increase in housing no more than 100 or 5% the lesser of the 2.
    Verified and documented cash reserves may be cited as a
    compensating factor subject to the following requirements.
     reserves are equal to or exceed three total monthly
    mortgage payments (one and two units); or
     reserves are equal or exceed six total monthly mortgage
    payments (three and four units).
    Funds and/or “assets” that are not to be considered as cash
    reserves include
     gifts;
     equity from another property;
     borrowed funds; and
     cash received at closing in a cash-out refinance
    transaction or incidental cash received at closing in the
    loan transaction.
    The mortgagee may use a portion of a FHA mortgage applicant’s retirement
    account (IRA, Thrift Savings Plan, 401k, and Keogh
    accounts) to calculate cash reserves, subject to the following
    conditions:
     to account for withdrawal penalties and taxes, only 60%
    of the vested amount of the account, less any outstanding
    loans, may be used. The mortgagee must document the
    existence of the account with the most recent depository
    or brokerage account statement. In addition, evidence
    must be provided that the retirement account allows for
    withdrawals under conditions other than in connection
    with the FHA mortgage applicant’s employment termination, retirement,
    or death.
    Verified and
    Documented
    Cash
    Reserves
    (continued)
     if withdrawals can be made only in connection with the
    FHA mortgage applicant’s employment termination, retirement, or
    death, the retirement account may not be used to
    calculate the FHA mortgage applicant’s cash reserves. If any of these
    funds are also to be used for loan settlement, that
    amount must be subtracted from the amount included as
    cash reserves.

Requirements for manually underwritten FHA loans?

Maximum qualifying ratios for manually underwritten loans are determined according to the lowest minimum decision credit score and compensating factors.

Lowest Minimum Decision Credit Score 500-579 or No Credit Score:  31/43

Lowest Minimum Decision Credit Score 580 and above: 31/43

2. 37/47  – Requires 1 of the following Compensating Factors:
• Verified/documented cash reserves equal to or exceeding 3 (1-2 units) or 6 (3-4 units) total monthly Texas FHA mortgage lender payments.
• Minimal Increase in Housing Payment
New total monthly Texas FHA mortgage lenders payment doesn’t exceed current total monthly housing payment by more than $100 or 5% (whichever is less); and – There is a documented 12-month housing payment history with no more than one 30 day late payment. In cash-out transactions, all payments on theTexas FHA mortgage lenders being refinanced were made within the month due for the previous 12 months.
– May not be used as a compensating factor if the FHA mortgage applicant has no current housing payment.• Residual income3. 40/40 – No Discretionary Debt:
• The FHA mortgage applicant’s housing payment is the only open account with an outstanding balance not paid off monthly; and
• The credit report shows established credit lines in the FHA mortgage applicant’s name open for at least 6 months; and
• The FHA mortgage applicant can document these accounts have been paid off in full monthly for at least the past 6 months.

4. 40/50 – Requires 2 of the following Compensating Factors:
• Verified/documented cash reserves equal to or exceeding 3 (1-2 units) or 6 (3-4 units) total monthly Texas FHA mortgage lender payments.
• Minimal Increase in Housing Payment

– New total monthly Texas FHA mortgage lenders payment doesn’t exceed current total monthly housing payment by more than $100 or 5% (whichever is less); and
– There is a documented 12 month housing payment history with no more than one 30 day late payment. In cash-out transactions, all payments on the Texas FHA mortgage lenders being refinanced were made within the month due for the previous 12 months.
– May not be used as a compensating factor if the FHA mortgage applicant has no current housing payment.

• Significant Additional Income (Overtime, Bonuses, Part-Time or Seasonal Employment) Not Reflected in Effective Income

– Received for at least 1 year, and will likely continue; and
– If it were included in gross effective income, is sufficient to reduce the qualifying ratios to not more than 37/47.

• Residual income

What is considered a minimal increase in housing payment on a manually underwritten FHA loan?

A minimal increase in housing payment may be cited as a compensating factor subject to the following requirements:
• the new total monthly Texas FHA mortgage lenders payment does not exceed the current total monthly housing payment by more than $100 or 5%, whichever is less; and
• there is a documented 12-month housing payment history with no more than one 30 day late payment.  In cash-out refinance transactions all payments on the Texas FHA mortgage lenders being refinanced must have been made within the month due for the previous 12 months.
• If the FHA mortgage applicant has no current housing payment lenders may not cite this compensating factor.The current total monthly housing payment refers to the FHA mortgage applicant’s current total Texas FHA mortgage lenders payment or current total monthly rent obligation.

What is considered significant additional income as a compensating factor?

Additional income from overtime, bonuses, part-time or seasonal employment that is not reflected in effective income can be cited as a compensating factor subject to the following requirements:
• the Texas Bad credit Texas FHA mortgage lenders must verify and document that the FHA mortgage applicant has received this income for at least one year, and it will likely continue; and
• the income if it were included in gross effective income, is sufficient to reduce the qualifying ratios to not more than 37/47.Income from non-borrowing spouses or other parties not obligated for the Texas FHA mortgage lenders may not be counted under this criterion.This compensating factor may be cited only in conjunction with another compensating factor when qualifying ratios exceed 37/47 but are not more than 40/50.

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