Mortgage Glossary
Credit Event Seasoning
How much time has passed since a borrower’s last bankruptcy, foreclosure, short sale, DIL, or mortgage charge-off.
What is Credit Event Seasoning?
Credit event seasoning measures the number of months between a borrower’s most recent “credit event” and the date of the current loan application. The seasoning clock starts on the discharge or resolution date, not the original filing date.
The events that count are the serious ones: Bankruptcy (any chapter), Foreclosure, Short Sale, Deed in Lieu of Foreclosure, Pre-Foreclosure, and Mortgage Charge-off. Loan modification or forbearance is generally treated as a softer event with its own (shorter) seasoning window. Garden-variety late payments don’t count as credit events; they live on the housing-history side of the ledger.
From an underwriting standpoint, seasoning is the lender’s evidence that the borrower has rebuilt financial stability since the event. The longer the gap, the less the event signals about current risk. Most non-QM matrices treat 36+ months of seasoning as effectively neutralizing the event for LTV purposes, while shorter seasoning reduces max LTV and loan size.
How Credit Event Seasoning works at Total Quality Lending
On Total Quality Lending’s DSCR program, at least 36 months of credit-event seasoning is required for no LTV reduction. At ≥24 months but less than 36 months, max LTV caps at 75% on purchase. Forbearance and loan modification require more than 12 months of seasoning.
On the Prime Time non-QM program, the standard credit-event-seasoning tiers (per the Prime Time matrix) are: ≥36 months unlocks the full LTV matrix, ≥24 months caps at 80% purchase / 75% refinance and $1.5M loan, and ≥12 months caps at 70% purchase / no refi / $1M loan. The alt-doc paths — P&L Only, Asset Utilization, and Written VOE — all require at least 36 months of seasoning regardless of FICO or loan tier.
FAQs
What counts as a credit event for seasoning?
Bankruptcy (any chapter), Foreclosure, Short Sale, Deed in Lieu of Foreclosure, Pre-Foreclosure, and Mortgage Charge-off all count as credit events for seasoning purposes. The seasoning clock starts on the discharge or resolution date.
How does TQL DSCR treat credit event seasoning?
TQL DSCR allows full pricing with ≥36 months since the last credit event. With ≥24 months seasoning, TQL allows up to 75% LTV on purchase. Forbearance or loan modification requires more than 12 months of seasoning.
Does Prime Time non-QM have different seasoning rules?
The Prime Time matrix uses its own credit-event seasoning tiers: ≥36 months unlocks the full LTV matrix, ≥24 months caps at 80%/75% LTV (purchase/refi) and $1.5M loan, and ≥12 months caps at 70% purchase / no refi / $1M loan. The alt-doc paths (P&L, Asset Util, Written VOE) require ≥36 months.