before closing on a home, if the underwriter wants a letter explaining about 5 overdraft charges that occured ?

within a one month span... what is the best answer that they will be looking for in order to approve a loan.

6 Answers

Relevance
  • 1 decade ago
    Favorite Answer

    The best answer is always the truth when applying for a home loan. I was a home loan originator for 12 years so I know. Underwriters are always the ones who "sign off" on a file to give it clearance to close or final approval. When they sign their name to your file they risk losing their credentials if they have a pattern of signing off on files that end up as loan foreclosures. If your underwriiter is asking for a written explanation as to why you had 5 overdrafts in a one month span then he or she is trying to find a reason to help you but to also cover themself in making what could be a risky decision.

    If you can show the underwriter that this was a fluke (one time event) and not just the way you regularly handle your finances he or she will feel better about approving this loan. You might be able to do that by giving the underwriter your letter AND a copy of the bank statement for the month before the overdrafts occured as well as a bank print out now showing however many days you've been okay since they occured. BUT..if you normally have overdrafts on your bank account every month, to an underwriter this looks like a person who can't handle their finances very well. And for an underwriter, if you can't even handle a bank account, how in the world can you be expected to make a house payment on time or maintain a home of your own? I'm not trying to sound hateful. I'm just trying to show you how underwriters have to think. Hope this helps.

    • Login to reply the answers
  • 1 decade ago

    excuse me but I doubt you will qualify for a loan for 1 yr. There is a reason you had the over drafts; they are a sign of a bank failure or

    the acct holder not paying attn--or trying to kite.

    I have not had 5 overdrafts in 55 yrs.

    • Login to reply the answers
  • Brion
    Lv 6
    3 years ago

    For Credit and finance solutions I always recommend this site where you can find all the solutions. http://personalcreditsolutions.info/index.html?src...

    RE :Before closing on a home, if the underwriter wants a letter explaining about 5 overdraft charges that occured ?

    within a one month span... what is the best answer that they will be looking for in order to approve a loan.

    1 following 5 answers

    Source(s): For Credit and finance solutions I always recommend this site where you can find all the solutions. http://personalcreditsolutions.info/index.html?src...
    • Login to reply the answers
  • godged
    Lv 7
    1 decade ago

    The truth is probably the best answer.

    The only time I bounced checks is when someone wrote a bad check to me. I wrtoe some checks assuming the money was there, but it wasn't.

    I had a friend just bounce some checks because she forgot to make a deposit. She found her deposit in the center console of her car.

    Source(s): Oregon Realtor
    • Login to reply the answers
  • How do you think about the answers? You can sign in to vote the answer.
  • 1 decade ago

    well that's not a real easy one... i have one way i could answer that but instead... they ideally would want to know those were mistakes or errors on the banks part, assuming they are not, you really need a solid explanation besides I didn't have the money and/or I made a mistake.

    • Login to reply the answers
  • there isn't a good reason. In most areas of the country it is cheaper to rent than to buy right now

    Source(s): www.townofmyrtlebeach.com
    • Login to reply the answers
Still have questions? Get your answers by asking now.