Less than a month away from closing...

[Stacy1]

My husband and I recently received three separate pre qualifications through USAA. My husbands income is based off of commission which USAA and most mortgage loans require two years history of. When we called USAA we weren't too hopeful but the woman we spoke with saw no reason as to why we couldn't move forward. She assured us after speaking with under writers three times that we were all set, so we set out to find a house. My husband and I fell in love with a home. It is perfect for us, our son and our soon to be daughter. We received our massive packet of paperwork from USAA, filled out all the documents, signed all the checks and did everything exactly as asked. We, as well as the sellers had signed the P&S and handed in our check. A week after signing the P&S we get a call from our mortgage officer that we are being denied because of the fact that my husband is paid commission and doesn't have two years pay history. I can't begin to tell you how thorough we were in making sure we were covered and to get this far into the process (our closing was supposed to be in less than a month) is absolutely heart breaking. To make matters worse, our mortgage officer had absolutely no sympathy and kept repeating "there's nothing I can do on my end". She was completely rude and unapologetic. I have never had a bad experience with USAA customer service until now and I can honestly say because of how we were treated and this woman's attitude, I would not recommend USAA to any of our friends.You clearly do not have people that are educated on mortgage loans or your requirements for obtaining a mortgage loan. USAA definitely needs a better process in place because there is no way that someone should get this far then turned down. Have people fill out the ridiculous paperwork first, not after their offer has been accepted.

[Stacy1]

I also wanted to add that according to our mortgage officer, there was absolutely nothing else we could do or no one else we could talk to and that we'd be wasting our time. It is such a terrible feeling to have felt like everything was coming together for your family and then it all falls apart and you can't do anything about it because you're dealing with a person on the telephone who insists its "not worth your time or effort".

[DSTEXAS]

Stacy,

Sorry you were not able to obtain your mortgage loan.

A pre-qualification is not a guarantee that a mortgage loan will be approved.  It would have been better if you could have have received a pre-approval, though with your husbands commission salary history that may not have been possible.

While it is true that two years of commission history is the norm for mortgage loans, that is not set in stone.  It is possible to get a mortgage with just 1 year commission history.  Depending on they type of mortgage loan, the underwrite will have to do more in-depth review of the situation to attempt to justify the loan, the final decision being based on a comprehensive review of all the factors.

Unfortunately, in your situation the only way to determine if you would be able to get the loan is complete the whole process.  

When your ready to undertake this process again, consider obtaining a pre-approval rather than pre-qualification (if possible).  It is still possible to be denied during the underwriting process, but less likely if you watch out for a few land mines!

Good luck.

[EEE3]

I second DSTEXAS's recommendation about pre-approval rather than pre-qualification.

I am so sorry that this occurred to you and your husband.  Have you tried to pursue financing through other lendors?  While your closing date would most likely need to be pushed out, another lender may be willing to provide the funds even with a shorter commission pay history, and the sellers may be understanding of this and cooperate with a later closing date rather than having to go back to the "keep house perfect and leave at a moment's notice for buyer showings".

According to website (http://www.mortgage101.com/article/mortgage-pre-qualification-vs-pre-approval)[emphasis has been added by me]

Pre-Qualification

A mortgage loan pre-qualification is simply an estimate of how much house you can afford and how much money a lender would be willing to loan you. The best time to get a pre-qualification is right at the beginning of your home buying process, before you even start looking at houses. This involves either sitting down with a lender or talking with one on the phone, and providing information on your income, assets, debts, and a potential down payment amount. The lender would then provide you with a ballpark figure in writing of how much he thinks you could afford to pay for a monthly mortgage. There is no cost involved and there is no commitment on either side. This estimate is just helpful in helping you figure out if buying a home is a viable option, and if so, what your price range would probably be.

Pre-approval

Getting pre-approved means that you have a tentative commitment from a specific lender for mortgage funding. In this case, you provide a home loan lender with actual documentation of your income, assets, and debts. This process typically requires an application fee as well, since the bank will run a credit check and work to verify all your employment and financial information. Once you are approved, the lender will give you a letter of commitment, stating how much money her bank is willing to loan you for a home purchase. With a pre-approval in hand you can start your shopping - real estate agents and sellers will take you much more seriously when they see you have your mortgage funding in place.

It is important to understand, however, that even a pre-approval is not a guarantee that you will be approved for a mortgage loan.  The funding will only be given when the property appraisal, title search, and other verifications check out on the home you have chosen to buy.  Neither is the pre-approval binding; you can still obtain a mortgage from a different lender. If you do stick with the same company that pre-approved you though, the application process will be much shorter once you find the right house.

[Stacy1]

Thank you both for your comments. The frustrating thing is we called on speaker phone with our realtor about it being called a pre-qualification and we were told that USAA's pre-qualification is as good as a pre-approval and that is how a lot of lenders were doing it now. We checked all of our bases and people at USAA kept telling us we were good and didn't have to worry. We have tried other lenders in the past with no luck because of the commission. We are currently in the process of trying to find something that will work. I refuse to let go with out a fight!

[Briana Hartzell USAA]

Dear Stacy1,

I am so sorry to hear about your experience. I have escalated your comments to a mortgage specialist who should be reaching out soon. Thank you.

[Stacy1]

DSTEXAS - do you know which loans are willing to only consider 1 year of commission history?

[DSTEXAS]

Stacy, both VA and FHA will consider it.  See my post here - if they were not the ones who denied your mortgage, you can try one of the Big Banks.

[Briana Hartzell USAA]

Hi Stacy1,

I just wanted to check in with you! It looks like one of our specialist spoke with you 5/6 and left a message on your voice mail this morning 5/11. Please let me know if we can assist you with anything else! Thank you!

[Briana Hartzell USAA]

Hi Stacy1,

I just wanted to check in with you! It looks like one of our specialist spoke with you 5/6 and left a message on your voice mail this morning 5/11. Please let me know if we can assist you with anything else! Thank you!