I’ll start this story at the end of one loan app and continue on the beginning to end of another. I also want to thank @oorhett for his detailed HELOC journey which inspired me to work with BCU. 🙏🏽
1/23/24 DH and I app’d for a HEL with BCU. In one of the fastest and smoothest processes ever, we got all the way to "clear to close” on 2/13 before the title company notified BCU that we already had a Texas section A(6) loan so HEL was not possible!😩😩😭 BCU folks were as crushed as we were it seems. Only option then was full cash out refi.
Sooo…Refinancing it is!
2/13 - Submit new application for $415K Mortgage ($100K cash out)Cash out Refinancing. Able to work with same Loan Officer and Processor once new app submitted. They will use and upload all the docs we submitted for HEL
2/14 - Recieved new document disclosures. Signed and returned.
2/14 - Notified LO of new cash out amount of $115K (to cover loan closing costs) for full refi mortgage amt of $430K 30yr Conventional @7% LTV 45%
2/15 - Received new updated loan estimate disclosures via Docusign. Signed and returned.
2/16 - Full appraisal on property done.
2/20 - Received appraisal report - came in $100K ($955K) higher than previous Desktop appraisal used for HEL which was showing $850K
2/21 Loan Processor has following requests from underwriting:
- Please sign/date the TX disclosure form
- Please provide a copy of most recent/ February mortgage statement and a payoff letter good through 03/11/24
- Please confirm you would like to escrow for taxes and insurance.
- Please provide a Letter of Explanation or an email describing the reason for the most recent (3 in 90 days) credit inquiries: (for BAXTER AND EQUIFAX January inquires please include a note explaining that all January inquiries were related to your previous/now cancelled home equity loan application with BCU)
- Please provide copies of most recent/updated statements accounts being paid at closing from loan proceeds (needed to do this to get DTI down)
2/23 - Loan Processor needs:
A copy of most recent statement for my account associated with 2023 1099-R
Proof of 2024 HOA dues payable
BCU will be reaching out to USAA to update mortgagee clause on homeowner policy
2/25 - We upload all requested info above.
2/29 - Asked BCU for update and found out USAA had not yet updated mortgagee clause. We call them to see if we could help. Got a person who handled it. BCU receives the pdf doc. from USAA
2/29 - Cleared to close!! Schedule appt for Title company signing for March 7th.
2/29 - Received email from BCU Closer with instructions for docusing disclosures and settlement docs. Completed
3/7 - Signing at Title Company/Notary
3/12 - Loan Funded/Cashout $$ wired to account/CC paid via fedex overnight checks to us to mail
17 Days from submission to approval/clear to close!
24 Days to Signing
29 Days to Fund
Other DP’s:
Chp7 bk - 4yr since discharge was January 2024
Kept our home through bk but didn’t reaffirm the mortgage so it disappeared from CR but we always paid on time.
DTI - was 42% before paying off cc at closing. Got it down to 36% (DH also got a nice raise)
Income: $185K
FICO Mortgage scores: 705
Texas has stringent laws around 2nd mortgages (HELOC/HEL) that we nor BCU were aware of until the end of first process. We had done a cash out refi 7yrs ago and simply did not realize the implication. Texas Section 50 A )( 6 mortgage: You become ineligible for a home equity loan (HEL) or home equity line of credit (HELOC) once you have cash-out refinancing in place.
Hope this helps someone!
Thank you @Kasuito39! They pulled TU only for the HEL, then all 3 (using Factual Data) for the full refi.