A lot of things go into underwriting a mortgage but contrary to what people say not everything is black-and-white.
Not everyone has 20 to 25% down, has been working for two years, has tremendous income, loads of liquid assets, or 800 credit scores. If you do you should thank God every day (which you should do anyway, if you don’t), but for those who are missing one or two of those things or maybe even three we have what we call in the mortgage world “compensating factors” which offset the lack of any of those above criteria. The list is exhaustive, but I’ll give you some idea of the compensating factors and how they work.
If a credit score is in the 600’s a big down payment may help offset that number.
If you only have one year of working but went to grad school you may not need two years of work history.
If your income is low but you are heavy on liquid assets you make it qualified using “asset depletion.”
If your income is low having a cosigner to increase income can go a long way in helping you get qualified.
Logic and thinking like a mortgage underwriter is important.
Remember you don’t have to be perfect to buy a home for you or your family.
By Carl Guzman
Carl Guzman, NMLS# 65291, CPA, is the founder and President of Greenback Capital Mortgage Corp. a Zillow 5 star lender http://www.zillow.com/profile/Greenback-Capital/Reviews/?my=y.He is a residential and reverse mortgage financing expert and a deal maker with over 26 years’ industry experience. Carl and his team will help you get the best mortgage financing for your situation and his advice will save you thousands! www.greenbackcapital.com [email protected]
