Please ensure Javascript is enabled for purposes of website accessibility

1-954-667-9110

FHA Mortgage Lenders Approval With Disputed Accounts

FHA Mortgage Lenders Approval With Disputed Accounts derogatory accounts >= $1,000 cumulative must be downgraded to “Refer” manual underwrite. Medical and accounts resulting from identity and credit card theft or unauthorized use are excluded. A letter from the creditor, police report, etc. is required. Disputed non-derogatory accounts are excluded from the $1000 cumulative total which includes accounts with zero balance, accounts with late payments aged 24 months or older, or disputed accounts that are current and paid as agreed.

Minimum Payment If no payment is indicated, 5% for revolving charge accounts. 

How are disputed credit accounts considered for manually underwritten loans?

 

Disputed Derogatory Credit Account refers to disputed charge off accounts, disputed collection accounts, and disputed accounts with late payments on an FHA mortgage applicants credit report in the last 24 months.   If the credit report indicates that the FHA mortgage applicants is disputing derogatory credit accounts, the FHA mortgage applicants must provide a letter of explanation and documentation supporting the basis of the dispute.   If the disputed derogatory credit resulted from identity theft, credit card theft or unauthorized use balances, the mortgagee must obtain a copy of the police report or other documentation from the creditor to support the status of the accounts.  If the FHA mortgage applicants has $1,000 or more collectively in Disputed Derogatory Credit Accounts, the FHA mortgage lender must include a monthly payment in the FHA mortgage applicants debt calculation.   The following items are excluded from the $1,000 cumulative balance: 
•     disputed medical accounts; and 
•     disputed derogatory credit resulting from identity theft, credit card theft or unauthorized use. 
•     Accounts of a non-borrowing spouse in a community property state  

If a FHA mortgage applicants is disputing non-derogatory accounts, or is disputing accounts which are not indicated on the credit report as being disputed, the lender must analyze the effect of the disputed accounts on the FHA mortgage applicants ability to repay the loan. If the dispute results in the FHA mortgage applicants monthly debt payments utilized in computing the DTI ratio being less than the amount indicated on the credit report, the FHA mortgage applicants must provide documentation of the lower payments.  Non-Derogatory Disputed Accounts include the following types of accounts: 
•     disputed accounts with zero balance; 
•     disputed accounts with late payments aged 24 months or greater; or 
•     disputed accounts that are current and paid as agreed.  

FHA-MORTGAGE-LENDERS.COM - DISCALIMER

US Mortgage Lenders has an extensive lender network that allows us to provide unique and mortgage solutions. Contact US for the most update information on terms and conditions. All Information on this site Is for example, hypothetical purposes and should NOT be relied on for decision making.
Email Questions To Google
Hide Buttons
Skip to content