My client and his significant other spent months boosting their credit scores, including building credit from scratch. They qualified for a loan, went under contract for a brand-new home, and were just weeks away from closing.
Then, out of nowhere, the lender flagged an outstanding warrant from 1995 related to a business tax debt for over $4,000 — a debt the client remembers paying in full on the very same day. Although it was tied to his business and not his personal credit, it still appeared during the underwriting process.
Because this happened 30 years ago, no documentation was readily available, and my buyer quickly felt overwhelmed — so much so that he was ready to walk away from the deal entirely. He thought it was hopeless.
As his REALTOR®, I knew I needed to take action. Thanks to proactive efforts — including reaching out to county offices, researching public records, and securing proof that the warrant had been satisfied — I was able to provide the lender with the documentation needed to keep the purchase moving forward.
What Buyers Need to Know
Even if your credit score is in great shape, surprises can pop up during underwriting. Here’s what you should be prepared for:
Old financial issues can resurface: Warrants, judgments, tax liens, or debts from decades ago — whether personal or business-related — can still appear during the mortgage process.
Documentation is crucial: Being able to prove that past debts were paid or settled can save you from delays or even denial.
Not all credit checks are the same: Different lenders and underwriters use varying services and databases, some of which dig deeper than others.
Government-backed loans have strict requirements: FHA, VA, and USDA loans often require detailed proof that all old debts are resolved.
A Word for Sellers
Keep in mind that buyers may face unexpected hurdles in loan approval, especially if they’re getting government-backed loans. Patience and understanding during the underwriting process can help the deal move forward smoothly.
Also, sellers should be aware that their own property can have hidden issues:
Check that all permits are closed: If you’ve had work done on your home, verify that the final inspections are complete and permits are closed.
Resolve any outstanding liens or assessments: Property taxes, HOA fees, or judgments can all delay a sale.
Disclose everything: Full transparency helps avoid surprises and builds buyer confidence.
For Both Buyers and Sellers — Don’t Give Up
When challenges pop up — and they sometimes do — it’s easy to feel discouraged. My client was ready to call it quits because he didn’t see a way forward. But with persistence, creative problem-solving, and the right guidance, we turned what looked like a deal-breaker into a closed transaction.
Whether you’re buying or selling, know that unexpected issues don’t always mean the end of the road. With the right team on your side, most problems can be solved.
If you want a REALTOR® who will go the extra mile to protect your interests and keep your deal on track, I’m here to guide you every step of the way.
Buying and Selling is Betta with Etta. ✅
