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New Jersey couple struggles with pre-approved mortgage due to coronavirus crisis
FOX 29's Joyce Evans reports.
NEW JERSEY - Scott McFerren and Anthony Wesley are hard at work on their “fixer-upper” less than 24 hours after settlement. That’s typical for most but what they had to go through to get to that point months later, is a new home buying world thanks to the coronavirus.
The couple almost gave up. They had sold their pristine five bedroom rancher in Voorhees, New Jersey, in late March, and their offer on a smaller, much cheaper, bi-level home in Atco, New Jersey, was accepted without problems.
Their lender, like many others now, told them that their pre-approved mortgage based on a 620 credit score in January was no longer good enough for financing during the coronavirus crisis.
“The scores kept having to go up to get the better rate like 625, 650, 675, 680,” said Scott.“I had panic attacks through this whole thing, it was ridiculous,” added Anthony.
South Jersey real estate expert Val Nunnekamp says acceptable credit scores aren’t the only change. He says employment must be verified again at the settlement table.“As we started noticing the unemployment numbers going up, 18-19 percent, the mortage industry decided to put a curve on our lending.”In addition to the new employment policies, many realtors are asking for 20 percent down instead of 10.
“You better have a down payment, you better be in your job at least 3 years and your score better be at least 640," Nunnekamp said.
And if not, people will have to work quickly to get to get their scores up and possibly put their search on hold.
As for Scott and Anthony, it took them two and a half months to get their score up to 660. In the meantime, they had to move in with family and rent three storage units. But for now, they’re good.“Now it’s time to celebrate and work.”
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