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Why does the lender need the last 12 months of rental recipets in order for me to quilify for a USDA loan

I have been renting a home from a friend for the last 11 months with intensions of buying it. I started renting due to my credit score not being a 640. Now, my score is a 640 I have been working with a local lender. After he pulled my credit he called and informed me that he could get the loan but I would have to get a termite inspection, home inspection as well as an appraisal done. Now that I have paid for a these things and had them done he informs me today that he needs 12 months of rental receipts for his under writer to go any further. I have personal receipts from the owner and I also have 2 years worth of receipts from the place I rented prior to this home. The lender says the personal receipts wont work and the receipts from my prior rental home wont work cause they are to old. What do I do? I have 4 kids and receive ssa survivors benefits as my only source of income. by NICOLE_001740 from Collierville, Tennessee. 25 days ago Reply


William J Acres (William_Acres)
#1 ranked lender in Arizona - 8,044 contributions

More info needed to address your specific scenario, but in general.. When your file is run through the automated underwriting system (AUS), it will state whether or not you will need to prove rental history.. Also, because it's USDA.. your file is actually underwritten 3 times,, Once by the AUS, once by your lender and the again by USDA.. so it's possible one of 3 underwriting processes is requiring this history.. And your lender is correct, personal receipts are not acceptable since they can be fraudulently made very easily.. and this was a major area of loan fraud in the past years.. so the guidelines have changed, and personal receipts are no longer acceptable. That being said, if you have limited income, and limited credit, then not being able to prove rental history can be a deal breaker.. If you had paid your landlord with personal checks, then you can go to your bank and do a Payee history report, and you can get a copy of the last 12 checks.. or if you did an "bill pay" or ETF then it will show the last 12 payments to that particular payee (Ie.. your landlord).. If you paid your friend cash, then if you pulled out exactly the rent amount on or around the same time each month, then you could use your last 12 months' bank statements, and highlight your withdrawals... so long as you are pulling the same amount out each month at around the same time, then this could be sufficient/acceptable proof of rent payment.. I'm a preferred Lender with California and Arizona being my primary markets. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. 480-287-5714 WilliamAcres.com NMLS# 226347 / RPM Mortgage NMLS 1541014 / AZMB0121893

25 days ago
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Nikitas Kouimanis (MrMortgage)
#1 ranked lender in New York - 110 contributions

What state are you looking for a loan in?

24 days ago
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Tennessee

24 days ago
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