how in depth does the mortgage company get with verification?

Deal Score0

i applied for a fha mortgage and the mortgage company is not counting my student loans in my dti because they are on forbearance. technically, they are supposed to be on forbearance for a year, but mine will not be in 5 months. they used my forbearance letter that didn’t say when i had to start repaying and they never asked me when the forbearance was up.

does the underwriter or someone else actually call the student loan company to verify, or do they just work off the paperwork given to them?

I am trying to buy a house and expect to close in 45 days. My money is tight due to down payment, closing costs, moving costs, etc. I am thinking of getting a forbearance on my student loan so I save some money but I don’t want to do it if it will lessen my credit score and jeopardize my mortgage approval.

12 Comments
  1. Reply
    lender2you
    April 29, 2011 at 9:16 pm

    Yes and your Loan Officer is doing you a grave disservice by not disclosing this to the u/w up front. I hope you will still fit the DTI once that is added into your debt. FHA is very concerned right now with the numbers and tend to be extra critical. You may want to ask that it be added in so you can see your DTI and make sure you are still qualified for this loan.

  2. Reply
    Noneya
    April 29, 2011 at 9:54 pm

    You will be required to provide documentation that shows the loans are deferred for at least 1 year otherwise the underwriter will include the payments.

  3. Reply
    Helen D
    April 29, 2011 at 10:38 pm

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  4. Reply
    Pengy
    April 29, 2011 at 11:26 pm

    Forebearance does not appear on you credit score

  5. Reply
    Don
    April 29, 2011 at 11:31 pm

    No, this should not effect your credit score.

  6. Reply
    brokerstorage
    April 30, 2011 at 12:20 am

    It probably will

  7. Reply
    eightieschick37
    April 30, 2011 at 12:52 am

    Don’t know get an advisor

  8. Reply
    magnolia
    April 30, 2011 at 12:53 am

    i have put my loans in forbearance before, and i have not noticed a change in my creidt score. i never though of it, actually. what a great question 🙂

  9. Reply
    J P
    April 30, 2011 at 1:18 am

    The forebearance won’t make any difference. The overall debt left on the student loans will.

    That is to say, neither will negatively affect your credit (as long as you make payments on time when you’re supposed to be making payments) but the overall debt will likely affect the amount you’re qualified to borrow even if you’re not required to make payments right now.

  10. Reply
    Jimmy John
    April 30, 2011 at 1:30 am

    Sounds good at first, but you may talk about it to a loan officer, in any bank other than your bank.

    Good luck !

  11. Reply
    Deebari T
    April 30, 2011 at 2:08 am

    NO

  12. Reply
    Maggie Jeans
    April 30, 2011 at 3:07 am

    Probably not, however – beware
    If you can’t afford to pay off the student loans, why on earth do you want to climb deeper into debt and take out a mortgage? I know this is not what you want to hear, but I have to give you an honest answer.

    A forbearance is a only a temporary postponement of principal payments, if you are willing but financially unable to make the required loan payments. Interest continues to accrue during the forbearance period, and must be paid at least annually. For many of these, the period is only a few years, and then payments are due (principle & interest).
    These payments and a mortgage could financially strap you – leading to a diet of additional consumer debt (credit cards).

    You will be best served in the long run if you focus on paying your student loans off first. You should be able to wipe them out in just a few years if you are not also paying a mortgage. Then you will be able to buy a house and not be drowning in debt.

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