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Hi, I am wondering about the underwriting process. I was recently pre approved for a mortgage thru 5/3 bank. I am a 1099 employee. I only have a partial 1099 from last year and pay stubs as far back as they want to ask for, and have been with the company about 1yr 6month. The loan office said because I was a student 14months prior to starting the job it would be ok on my application. My real question is, I know you are supposed to have two years of 1099 filing and am trying to learn if there are any exceptions to this rule or will the underwriter simply shoot me down upon applying? I truly appreciate any help or experience. Thanks.

2 Thoughts on Mortgage and underwriting still possible?
  1. Reply
    February 13, 2014 at 4:28 am

    Federal regulations require all banks to make sure you have 2 years worth of steady income. If anything you could offer to put 30%+ down (but probably won’t work)

  2. Reply
    February 13, 2014 at 4:28 am

    Normally the bank you are dealing with is not the ultimate person that would own your mortgage loan. Banks normally sell each mortgage loan to an investors. These investors would normally have certain guidelines in order for your bank to approve a mortgage loan that these investors would normally purchase at the close of the purchase transaction.

    If the bank you are doing business with to secure your mortgage loan waive this 2 year requirement, they must maintain your loan and others like them for a certain period of time before an investor would purchase this mortgage loan from them. This is one of the exceptions that might be made.

    Some banks waive investors guidelines because your ratios are low enough that the underwriter would believe that you would pay as agreed on the mortgage loan docs and would wait to sell your mortgage loan in a couple of years. There are some extenuating circumstances that a bank might make to do what they consider a low risk mortgage loan.

    Since you have been reproved for a mortgage loan your application has been seen by a mortgage underwriter, thus you should be ok with this transaction.

    I hope this been of some benefit to you, good luck.

    “FIGHT ON”

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