If a borrower is selling their current home and it is under contract, but will not close until after the subject transaction closes, are we required to count the payment in ratios?

If a borrower is selling their current home and it is under contract, but will not close until after the subject transaction closes, are we required to count the payment in ratios?
May 24, 2018 Donna Malecki

If a borrower is selling their current home and it is under contract, but will not close until after the subject transaction closes, are we required to count the payment in ratios?

If the current principal residence is pending sale, but the transaction will not close prior to the subject transaction, and the borrower is purchasing a new principal residence, the current PITIA and the proposed PITIA must be used in qualifying the borrower for the new mortgage loan.  However, Arch will not require the current principal residence’s PITIA to be used in qualifying as long as the following documentation is provided:  1) the executed sales contract for the current residence, and 2) confirmation that any financing contingencies have been cleared.

Last Updated On May 24, 2018