You wouldn’t believe the excuses people give for having bad credit.
October 8, 2013 – A borrower with chronically overdue loan payments said he had a good excuse: “My wife and I were abducted by aliens and implanted with a device.
Another man, explaining to a mortgage lender why he had a bad credit rating, sent a 10-page letter citing a wide variety of reasons, including finding out he was married to the devil. He said he should have known that, though, because his marriage license was number 666. Oh, and he had gout and hurt his back.
If you think they’re rich, Karen Deis has a million.
Deis trains loan initiators in direct marketing to consumers. As chairman of LoanOfficerTraining.com, it keeps underwriters and loan officers abreast of lending rules and guidelines. Recently, she invited her clients to send the most outrageous apologies they had ever received from borrowers as to why they were late on their payments, had bad credit scores, or suffered from other defaults on their credit records.
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Examples of choices from the list appear below.
Deis especially likes a letter from a woman who explained to a potential lender: “It wasn’t my pot pipe that started the fire. It’s my boyfriend’s. According to Deis, “Many of these things are the truth, unfortunately. Not everyone is an author or can explain themselves very well. This inability has affected the ability of these people to get credit or buy a house. ”
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By law, lenders can only base their lending decisions on the applicant’s credit, job stability, income, and (for mortgages), the amount of money they have available to make down payments or pay. closing costs. But life events like divorce, having to pay child support, or being in foreclosure can affect these variables and need to be explained.
She advises anyone trying to get out of the hole to do two things: First, make sure you can document everything you claim. Second, before you put the pen to paper, talk to a loan officer.
A loan officer, she explains, can help a consumer understand which issues or shortcomings matter to the lender and which aren’t. It is not necessary to explain those who do not. As for those who do, it is part of a loan officer’s job to help the applicant explain them; he or she can actually help you write your cover letter. Chances are he is more experienced than you at this kind of writing.
Okay, here’s a sample of don’ts, all said by real people trying to explain their credit sins:
– “We decided to pay off our credit card debts and stopped paying our house for a year. approved, right? “-” I pay late fees every month, so that should give me a better credit score. “-” My car broke down. I stopped making payments. I wanted them to come and pick up their junk car. the construction workers moved my mailbox and couldn’t find it for three months. “-” I thought she was paying her, she thought I was paying her. “-” The bill was always due at the wrong time of the month. “-” I make all my payments on time… to collection agencies. ” -Borrower explaining Mobil credit card late payment: “I had bad gas.” – “The stamp fell out of my payment envelope.”