Letter of Explanation (LOX or LOE) about: • Accounts that have been through collections. • Gaps in employment • Late Payments Other items may include: • Proof of source of funds in bank accounts • Employment verification • Homeowner's insurance contact and policy information Credit Score Challenges Instead of discouraging consumers from applying, loan officers need to be clear about what the credit requirements are for a particular loan instrument.
Tax Liens
A tax lien is when a Government (federal, state, local municipality) places a claim on a person’s property when that person fails to pay their taxes. It doesn’t mean the property was seized, but it means that the government will take that person’s property if seizure becomes necessary. You must resolve the lien(s) before closing on the purchase. If the lien is ignored and the information emerges at the closing, the transaction is going to be deferred or if the lien cannot be resolved the transaction may be cancelled.
Bankruptcies
If you’ve filed for bankruptcy, inform your loan officer at the start. They’ll assess your eligibility based on the type of bankruptcy and how much time has passed since it was resolved, as different loan programs have specific waiting periods.
Foreclosure
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