Attachment 10-A
Page 6 of 20
NON-TRADITIONAL CREDIT (continued)
• Utility services: gas, electric, water, land-line telephone service, or cable TV (services should not
be included in rent payments);
• Insurance payments: automobile, life, household, renter’s insurance, medical supplements.
Premiums paid through payroll deduction for employee offered coverage of plans are ineligible.
Premiums paid quarterly or annually are acceptable when the payment(s) provide 12 months of
coverage.
• Childcare: licensed childcare providers may provide documentation to support the date of
enrollment, dates of fees paid, etc. Bank statements to support cash withdraws or handwritten
receipts are not acceptable.
• School tuition;
• Payments to local stores (car dealerships, department/furniture/appliance stores, specialty stores);
• Payments for uninsured portions of medical bills;
• Internet or cell phone services;
• Automobile leases;
• Personal loans with repayment terms in writing, supported with canceled checks, money order
receipts, or electronic payment receipts;
• Monthly subscription services, gym memberships, etc. when they can be adequately verified in
accordance with this section;
• 12 month documented history of savings that demonstrate regular deposits which equal three
months of proposed mortgage (PITI) payments that will be retained as cash reserves post-closing;
• Any other reference that gives insight into the applicant’s willingness to make periodic payments
on a regular basis for recurring credit obligations.
Debts that are obligatory, when credit was not extended to the applicant (such as child support, alimony,
garnishments, court ordered debts), are not eligible non-traditional credit tradelines.
Simply meeting the minimum tradelines for non-traditional credit should not be the sole basis for
approval. The approved lender’s underwriter is responsible for analyzing the complete file when making
an underwriting decision.
Applicants that utilize non-traditional credit to qualify for a guaranteed loan are not eligible for debt ratio
OVERDRAFT/NON-SUFFICIENT FUNDS (NSF)
No credit exception is required.
An overdraft fee is a fee resulting from the processing of a debit transaction that exceeds the account
balance. A non-sufficient funds (NSF) fee is a fee resulting from the initiation of a transaction that
exceeds the account balance if the financial institution declines to make the payment.