Term
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Definition
| Customers willingness to pay. Credit report good for 90 days. |
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Term
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Definition
Inquiries;
Credit reports good for 90 days
Any trade line not included in ratios - credit supplement need to be ordered |
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Term
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Definition
| A storehouse of credit information. Credco taps into Equifax, Experian and Trans Union. |
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Term
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Definition
| Any credit inquires done within last 90 will need a letter of explanation. We need to be sure that we are counting all new debts in ratios. Looking for new debt. |
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Term
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Definition
| Open-paid in full end of month (amex); Installment (set loan; car, mortgage, and Revolving (credit card) |
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Term
| Customer's Name & Social Security Number |
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Definition
| Any incorrect spelling of names, a different middle intial or a change in the SS can cause incorrect info to be reported. |
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Term
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Definition
| A minimum of 2 credit scores must be obtained. If 2 scores are obtained, you go with the lower of the 2. If only 1 score is obtained, need alternative credit. If 2 people are on loan, the middle of both scores and the lowest of the 2. If 3 score are obtained, the middle score. |
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Term
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Definition
| Name of each credit account on credit report. |
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Term
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Definition
| ONLY ON INSTALLMENT: If 10 payments left keep in, if LESS than 10 payments remain, exclude. |
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Term
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Definition
| Have to paid in full each month. Not counted on ratios, if the borrower sufficient funds to pay off the outstanding account balance. |
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Term
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Definition
| Verify the present address on the 1003 against the credit report. Brings up red flags if don't match. |
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Term
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Definition
| Refers to anything that "is not paid as agreed" (If you make a deal with a credit company re: payments, if will show up as derogatory because you are not doing as agreed. |
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Term
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Definition
| A written explanation for any derogatory credit is required. Based on what you say, additional docs might be needed. |
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Term
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Definition
| Student loans - That is not being paid as agreed, the loan payback is delayed. Even if agreement is made "not paid as agreed" If monthly payment amount not showing use 3%. |
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Term
| 4 Most serious forms of derogatory credit |
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Definition
1) Bankruptcy
7 (wiped) and 11 (corp) - 4 years
13 - 2 years
2) Foreclosure (take house) 7 years
3) Deed in Lieu - 7 years
4) Short Sale - 7 years |
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Term
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Definition
4 new pieces of credit references, 1 of which must be housing related. Credit references must be 24 months old.
No lates with the exception of 2 30 days late. |
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Term
| Judgments, Liens, Charge-Offs and Collections |
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Definition
charge off collections - haven't gotten to judgment yet.
Judgments - must be paid in FULL prior to closing.
Liens - must be paid in FULL prior to closing.
Primary Residence - ignore as long as it doesn't effect lien position.
Second Home - collection & charge offs under $5,000 total does not have to be satisfied.
Investment - up to $250 per account (not to exceed $1,000 combined) do not have to be satisfied. |
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Term
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Definition
| Court ordered. Wage attachments are court ordered deductions from payroll. This is considered a judgement. |
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Term
| Accounts with No Report Monthly Payments |
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Definition
| If no monthly payment shown on credit report. Use 5% of outstanding balance. If student loan use 3% of outstanding balance. |
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Term
| Accounts with No Reported Balance |
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Definition
| If qualifies,use it, if not order a credit supplement |
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Term
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Definition
| Haven't had to start paying yet. Still have to include in debt. |
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Term
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Definition
| Do Not include as debt because they are paying themselves back. |
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Term
| Alimony/Child Support/Separate Maintenance |
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Definition
| Count as debt unless going to end in less than 10 payments. |
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Term
| Co-Signed loans/Loans paid by business |
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Definition
| Can exclude but have to show 12 months of cancelled checks front and back from original loaner accounts. Borrower cannot be on check. If Business, has to come from business account. If 12 months has not gone by, debt will be included. |
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Term
| Paying Off/Paying Down Debts to Quality |
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Definition
Paid down less than 10: Revolving: Cannot on Revolving. Installment: Proof they used own funds; statement reflecting new balance.
Paid off prior to closing: Revoling: Proof used own funds; Proof $0 balance; proof account closed. Install: Proof used own funds; Proof the account is closed.
Paid of at closing with proceeds from a cash out refi: Revolving: proof account closed; proof $0 balance; payoff must be refleced on HUD sheet. Install: On the HUD; proof of balance. |
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Term
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Definition
| Ordered by STARS to update an account or resolve an dispute. You can question up to 6 trade lines. After 6 a full factual is needed. |
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Term
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Definition
| Authorization to Obtain Credit and Financial Information before they will release information. Has to be attached to credit supplement information. |
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Term
| Verification of Rent/Mortgage |
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Definition
| Existing debt not on credit report - need to order an VOM, that's it! As soon as we hear there is a debt, but we need proof, order a VOM. |
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Term
| Documenting gaps of employment |
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Definition
| More than 30 days is a gap. Need letter of explanation. |
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Term
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Definition
| 2year history of receiving income and at least the next 3 years of continued. |
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Term
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Definition
30 days paystubs
2 years W-2s
4506T
VVOE within 10 days of closing |
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Term
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Definition
2 years W-2's
Tax return
WVOE
30 day paystubs
4506T |
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Term
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Definition
| 2 months bank statements Award letter Assumed continuous if over 6 - usually on award letter. |
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Term
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Definition
| 12 months bank statements Award letter |
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Term
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Definition
2 year tax returns
2 year history (W-2')
3 year continuous (WVOE)4506T |
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Term
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Definition
2 months statements
award letter
3 year continuous - WVOE |
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Term
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Definition
Court ordered only
12 months cancelled checks
3 year continuous - WVOE |
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Term
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Definition
Gross up by 25%. If do gross up could trigger tax return.
Copy of Award letter
2 months bank statement
WVOE - usually on award letter |
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Term
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Definition
Copy of Note
3 years continues (WVOE)
12 months on time |
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Term
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Definition
2 years return
W-2's
30 days paystub
3 years continuous (WVOE) done by a 3rd party (bookkeeper)
4506T |
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Term
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Definition
30 day paystubs
2 years W-2's
2 year tax return (to prove unreimbursed expenses)
4506T
WVOE |
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Term
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Definition
2 years tax return
statement showing account
WVOE - 3 years continuing |
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Term
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Definition
Trust agreement
Trust letter
2 years tax returns |
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Term
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Definition
2 years history (W-2)
2 year tax returns
WVOE
Don't need tax returns because we are not assuming there are unreimbursed expenses |
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Term
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Definition
| Anything not guaranteed needs a tax return! Self employed; commission; family employed; 109; family owned; union (you will get multiply W-2) |
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Term
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Definition
2 years history (W-2)
30 day paystub (YTD), figure out see if close
WVOE for continuous
2 year tax return - looking for unreimbursed, if they have unreimbursed (deduct)
2 year average
2 year commission - if stable increased take average and divide by 24. If decreasing take lower and divide by 12. |
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Term
| Reviewing bank statements |
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Definition
- Not older than 90 DAYS
- Verify 2 months (60 full days) are covered
- Ensure customers name and SS are on it.
- Recognize "AND" both have to sign off whether on loan or not. AND/OR either can sign. If no AND/OR we assume AND (need both)
- Any large deposits need to be verified
- Abnormal or inconsistent |
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Term
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Definition
In trust for:
Need trust agreement
Proof borrower is beneficiary |
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Term
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Definition
25% or greater of ownership.
2 years business tax returns
1099 |
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Term
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Definition
WVOE
2 years history W-2 (take average)
Has to be uninterrupted. Unemployment can be used as income. |
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Term
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Definition
2 year history
WVOE
2 years contract with temp agency |
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Term
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Definition
| Written Verification of Employment. Good for 30 days. If WVOE is rec'd within 10 days before closing a VOE is not required. |
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Term
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Definition
| Needed 10 days before closing. |
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Term
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Definition
| We use it, accept it and good for WVOE and VVOE's. |
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Term
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Definition
Verbal Verification of Employment. Cannot do our own, Conflict of Interest. Must match CASH.
Independently get phone number..internet, phone book. Must be made 30 days prior to closing. Take screen shot if from internet |
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Term
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Definition
| Leave and Earnings Statement within 30 days of closing. In lieu of VOE/WVOE. |
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Term
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Definition
Regularly consistent; part of someone's income for at least 2 years. (pool guy)
30 day pay stub
VVOE from unemployment
w-2's
Has to be back to work |
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Term
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Definition
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Term
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Definition
Short Term: Return to work date, if cannot be determined cannot be used.
Long Term: identify it is stable predictable and continuing.
Acceptable form of income
Non-taxable
Need return to work date. |
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Term
| Extended Leave of Absence |
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Definition
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Term
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Definition
Existing: 2 years tax returns (take average.
Future: Use 75% of net rental income; Need copy of lease. |
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Term
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Definition
| Babysitting, dog walking, room or board from family,tips...any income you don't claim. |
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Term
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Definition
Date of the Stub
Name of Customer
SS number
Name of the Company
Pay Period
Amount of Pay
Y-T-D figure
Any deductions
Any addition income |
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Term
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Definition
| 401K does not count as debt |
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Term
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Definition
Weekly x 52 / 12
Bi-Weekly x 26 /12
Semi-Monthly x 24 /12
Yearly amount /12
Actual amount x 12 /12 |
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Term
| Figure out gross monthly on pay check |
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Definition
6/5/12
Months been completely paid thru: 5
Days been paid thru: 5/30 (days in months). = .16. 11.567.00 / 5/16 = Grossly monthly paid to date. |
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Term
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Definition
| Proves history, income consistency. |
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Term
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Definition
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Term
| $ that needs to be brought to closing |
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Definition
Purchase: down payment; closing costs; pre-pad
Re-fi: Closing costs; pre-paid |
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Term
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Definition
| Checking Account; savings; money market |
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Term
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Definition
| Investment Accounts; Stocks/bonds/401K acounts; IRA accounts |
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Term
| Stocks/Bonds Mutual Funds |
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Definition
| 70% because their value changes every day |
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Term
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Definition
| Retirement Funds - 60%. IF loan on 401K, subtract amount and use 60%. |
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Term
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Definition
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Term
| Acceptable Alternative Docs |
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Definition
| If don't have bank statements - VOD (verification of Deposit). Bank printouts that are stamped and signed by bank officials are acceptable. |
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Term
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Definition
Good Faith Deposit.
Copy of borrower's cancelled check (front/Back)
Escrow letter from holder
Statement showing where money came from (make sure own funds)
YOu break contract, you lose money |
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Term
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Definition
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Term
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Definition
Real Estate Equity-When selling real estate, the cash from the sale is acceptable. 90%
Trade Equity.
Land Equity on New Construction - You own land, construction company builds home, sells you both and credits back to you the price of land. Land/House on 1 deed |
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Term
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Definition
2 months statements from original bank account.
Money converted and deposited into US Bank Account prior to closing. |
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Term
| Acceptable contributions - settlement costs only |
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Definition
Investor - 2%
Jumbo - 2nd home - 3%
Primary - Conforming - 90 + - 3%
2nd - conforming - 6%
Jumbo - primary - 9% |
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Term
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Definition
Z pricing - PHH contributes to closing costs in exchange for high interest rate.
Lender Credit - PHH contributes $ toward transaction |
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Term
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Definition
| Rent to Own. Part of rent is being saved towards down payment. |
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Term
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Definition
| The PITI in bank account. How many monmths of payments I have in bank after closing. Do Not have to be liquid. |
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Term
| 3 key factors that determines reserves that AUS will look at |
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Definition
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Term
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Definition
(stamp collection)
must show proof of ownership; sale (proof of deposit); Appraisal; bill of sale. |
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Term
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Definition
Anything unverifiable:
$ in wallet
Sweat Equitey
Cash on hand
Assets from repayment of loan |
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Term
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Definition
| Buying/Selling home: Side loan that represents equity because not going to sell in time. Paid back as soon as loan goes through. Has to approve with the Bridge loan included. |
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Term
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Definition
to pay down or pay off existing debt
The payoff of derogatory debt
Provided in cash (cannot be verified) |
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Term
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Definition
| Blood relative, marriage fiancess and domestic partner |
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Term
| Gift from Relatives Rules |
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Definition
1) The gift letter
2) Donors ability
3) transfer of funds into account
4) proof of receipt of deposit |
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Term
| When relative resides with a Customer |
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Definition
| If relative who provided gift lives with borrower, the gift counts as the 5%. |
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Term
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Definition
Affidavit must be signed.
Proof funds were deposited into account of customer
A marriage certificate |
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Term
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Definition
| Has to be agreement of sale. |
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Term
| Gifts from churches, municipalities or non profit organizations |
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Definition
| They exist and are possible. |
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Term
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Definition
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Term
| 2 major factors about appraisal acceptance: |
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Definition
3 Comps
condition - safe, sound, secure |
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Term
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Definition
| What someone is willing to pay - what the house would sell for now. |
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Term
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Definition
Appraisser Independance Requirements (AIR)
Loan is registered, appraisal ordered by STARS.
If new value effects our loan - rescore |
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Term
| Appraisal must provide customer a copy: |
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Definition
| at least 3 business days prior to closing date. Can also be e-mailed. |
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Term
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Definition
Increase loan amount
Reconsideration of value (borrower has to get additional comps!)
Could renegotiate price on purchase
Bring more $ to table
Cancel - have to pay cancellation fee |
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Term
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Definition
Full; drive-by; A property inspection waived. Using full appraisals. Good for 120 Days!
Disaster inspection - storm happens before closing
Final Inspection (new construction). Done right before closing
As is - means we are good
Subject to - means: repairs are needed, before closing. |
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Term
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Definition
| Appraisal is expiring - contact appraiser to get extension. |
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Term
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Definition
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Term
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Definition
| Uniform Standards of Professional Appraiser Practice. |
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Term
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Definition
Something simple wrong (wrong spelling of name, street instead of ave
reconsideration of value
recertification of value (close to expiring) |
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Term
| General definition of COmps: |
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Definition
Similar in style to the subject property; within a mile; sold in last 6 months.
Comps.
Market value
Condition: Safe, sound, sanitary |
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Term
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Definition
| Money being held in escrow for repairs that have to be made. Escrow 1.5X of what still has to be completed. On Refi - all work has to be done before closing. |
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Term
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Definition
5 or more units
commercial
Land only
Condotel
Working farms |
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Term
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Definition
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Term
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Definition
| Agreement of Sale (AOS), could be on a napkin. All parties must sign. |
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Term
| Contingency/Commitment dates |
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Definition
Date approved for loan
Appraisal by a certain date
Closing |
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Term
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Definition
Part of price credited toward closing costs.
Seller concession on Investor loan: 2%
Seller concession on jumbo loan: 3% |
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Term
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Definition
| Can only be included in sales contract if permanently affixed to home: washer/dryer, dishwater, frig. Not acceptable: Live stock; curtains; tools, VCR's. |
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Term
| What to look for on agreement of sale |
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Definition
| Buyers name; sale price; loan price; property address; closing date; signatures; earnest money |
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Term
| Manufactured home (formerly called mobile homes: |
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Definition
| Has steel undercarriage. Has to be 1st put down. Do not loan to single wide. Cannot be in mobile park. Must be Fee simple. Min. 1200 square fee; Must include HUD cert. |
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Term
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Definition
| Treated like single family home. Built in factory, Brought in in pieces. |
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Term
| Appraisal on Manufactured home |
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Definition
2 comparable
1004 C is required. |
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Term
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Definition
HTTPS
Customer listed as account holder
Name of depository, including log
Account number
Ending balance |
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Term
| Documenting large deposits |
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Definition
| Need to be explained and verified |
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