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Mortgage Loan Approval

We have a weird situation in terms of a short sale last year. We purchased a 2nd property in FL in 2006. In 2008, we found out the home had Chinese Drywall - it couldn't be lived in or rented - until it was gutted to the studs and rebuilt. We exhausted all income sources to keep this home afloat and worked very closely with our lender (who had an in-house toxic drywall department dedicated to the issue). The builder filed for bankruptcy and the insurance companies claimed they weren't liable, so we simply couldn't rebuild/restore this home. I was diagnosed with cancer, so in 2014 we finally worked with our lender to short sale our home to an investor. I wrote letters and requested that this not be reported to our credit, because our credit was PERFECT otherwise. We've never been late on a mortgage (we've had mortgage loans on our primary residence since 1999). To date it is not on our credit and our scores are in mid-high 700s. We would like to purchase a new home and have been told based on income and credit scores we are pre-approved. Is there a chance we won't get approved (for new home completed in March/April) because of this short sale - again not reported and due to two extenuating circumstances? This was a unique circumstance, very much beyond our control. by lizabeth81467 from Herndon, Virginia. Oct 1st 2015 Reply


Phil Dumouchel (PhilDu)
#32 ranked lender in South Carolina - 2,224 contributions

That's a tough one, it would take some research but ultimately it is up to your lender. Recommend you are totally truthfuly in answering all questions.

Oct 1st 2015
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Phil Dumouchel (PhilDu)
#32 ranked lender in South Carolina - 2,224 contributions

all questions asked by your lender.

Oct 1st 2015
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William J Acres (William_Acres)
#1 ranked lender in Arizona - 7,802 contributions

If it's not on your credit report, then it shouldn't be a problem.. there are no disclosure questions which ask if you have ever had a short sale.. they will ask about BK's and foreclosures, but not short sales, so you should be ok.. but if you want to know for sure, then contact a LOCAL mortgage broker and apply with them. Once they see your complete loan profile, they will be better equipped to advise you properly. Also, by applying with your LOCAL Broker, you have an advantage because he's familiar with local customs and works with many lenders with each one offering a different type of lending program. This is unlike the local bank which typically only has a few lending programs. The more lenders, the more lending options, and the more likely your scenario will be accepted.. Plus, the broker is experienced in seeking out the best loan terms for your particular scenario, and he has lower overhead which typically results in lower rates and fees than most of the larger lenders.. I'm a Broker here in Scottsdale AZ and I only lend in Arizona. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. William J. Acres, Lender411's number ONE lender in Arizona. 480-287-5714 WilliamAcres.com NMLS# 226347

Oct 3rd 2015
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