Coping with a Lender's Rejection

This is a story about a young married couple; Dave and Ann. Like many young couples, they were excited about buying their first home, but their excitement soon turned to disappointment when their request for a loan was rejected by their lender.

The first thing they did was inquire why this happened, what the lender didn't like, and what they could do to remedy the situation. Dian Hymer, in her book, "Starting Out, The Complete Buyer's Guide", writes that often a simple letter of explanation to the lender is all it takes to get a problem loan approved. For example, if you were unable to work for several weeks due to an accident, a letter explaining why your credit report showed late payments would probably result in a loan approval.

Remember that adverse credit information is not supposed to be reported or included on your credit report after seven years. An exception to the seven-year rule is bankruptcy information, which can be reported for ten years. Lenders will want to see court-approved papers that confirm your past creditors are satisfied with your debt-restructuring. Lenders will also want to see that you have re-established credit and that you are making your payments on time.

As a real estate pro, I will be happy to work with your lender to ensure your loan will be approved on time for closing. Call me anytime.