Deal Killer Alert: Non Borrowing Spouse’s Credit is Now Monitored
Married couple is buying a house and needs financing. The loan can only go in one of the spouse’s name due to credit/income problems for the other person.
The borrower’s credit will be monitored from the point of Application to Funding like normal BUT now the NON BORROWING spouse’s credit will be monitored as well.
When a borrower’s credit is monitored that means anytime they have their credit pulled after application and before funding that the lender is notified immediately.
The process stops and the lender needs to verify what the credit inquiry was. If the Borrower opened up a new account then the payment needs to be added to the application and could affect the Debt to Income Ratio potentially killing the deal.
The non-borrowing spouse will need to be reminded to not have their credit pulled during the process.
Not all lenders are doing this, but you will see more and more doing it in the future.
Compliments of Tim Hart
Van Dyke Mortgage Corporation