DU returns a finding that includes the condition 'Verify Previous Mortgage Payment History.' The borrower sold their previous home six months ago and provides a HUD-1 showing the payoff. DU still requires the payment history verification. Why might this be necessary?
Correct Answer
A) To confirm the borrower made payments on time before selling
Even when a previous mortgage has been paid off, DU may require verification of payment history to confirm the borrower's track record of making mortgage payments on time. This payment history is a key factor in risk assessment, and a pattern of late payments could affect the loan decision even if the mortgage was eventually paid off through a sale.
Why This Is the Correct Answer
Even when a previous mortgage has been paid off, DU may require verification of payment history to confirm the borrower's track record of making mortgage payments on time. This payment history is a key factor in risk assessment, and a pattern of late payments could affect the loan decision even if the mortgage was eventually paid off through a sale.
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A borrower requests to add a co-borrower 10 days before closing. The original Closing Disclosure was provided 5 days ago. What documentation action is required?
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A loan originator submits a loan to Desktop Underwriter (DU) and receives an 'Approve/Eligible' recommendation with a condition requiring verification of a recent large deposit. The borrower explains it was a gift from their grandmother. What additional documentation would DU most likely require to satisfy this condition?