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mortgage application/approval help


Aaron

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My wife and I are interested in getting a condo in Westerville/New Albany and wondered if someone could give us some answers.

 

The usual 36% debt to income ratio.......Is that used? are the flexible? The wife and I will be at close to 50% for about 5 months until the new year when I graduate and get a job. I was wondering if the loans are taken on a case by case basis? or If that % is even too high?

 

Just looking for some general first time home buyer/mortgage information.

 

thanks guys.

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i thought it was like 28-29%. dont waste your time on a condo, buy a house.

 

call the 5/3 at maxtown/state st by the kroger and talk to david cains, and set up an appointment with him. he was easy to work with when i bought my house at the beginning of the year

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I would say that all loans are underwritten and there is always a possibility that someone could understand your situation and lend some leeway.....you've just got to sell your story. I underwrite auto insurance and if I'm going to make an exception to a "guideline" there needs to be a story to convince me that the risk is acceptable to take on.
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It's 28% is for the mortgage itself. Your back end debt ratio, which is all your debt should be around 40%.

 

If you're going to graduate in 5 months, I would wait. The underwriters are being really picky and are not going to included any "possible" income from when you get a job. Unless you have some kind of offer letter from somewhere.

 

I was going to go the condo route last year, but I'm much happier I saved for another year and bought a house.

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Thanks for the help guys.

 

One reason we are thinking of doing this soon is for the 8k obama credit.

 

If we don't do it this year, then we won't be buying anything for probably 5 years.

 

We have some people we are talking to tonight and tomorrow, and should figure this all out soon.

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I don't understand what a measely $8000 matters in buying a house? And that's even IF you qualify for the entire $8000, which do you even know 100% for sure before you've already bought a place? What if you don't qualify after all, or you only get $4000?

 

A condo isn't really a good 'investment', as even in good economic times of growth, condo values, at least around here don't really change much, unlike houses. It's more of a place to live that's slightly different than renting, which you hope to break even on in the future.

 

Also, if you are looking into buying a place, you should ideally have at least 10% to put down plus some cash in the bank for what if's, and other costs that add up, so really think about that, because I had to put a new furnace and AC in my house in the first year and it was about $5000, let alone all the other things I have done, and I'm only going on year two now...

 

Good luck though.

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I don't understand what a measely $8000 matters in buying a house? And that's even IF you qualify for the entire $8000, which do you even know 100% for sure before you've already bought a place? What if you don't qualify after all, or you only get $4000?

 

A condo isn't really a good 'investment', as even in good economic times of growth, condo values, at least around here don't really change much, unlike houses. It's more of a place to live that's slightly different than renting, which you hope to break even on in the future.

 

Also, if you are looking into buying a place, you should ideally have at least 10% to put down plus some cash in the bank for what if's, and other costs that add up, so really think about that, because I had to put a new furnace and AC in my house in the first year and it was about $5000, let alone all the other things I have done, and I'm only going on year two now...

 

Good luck though.

 

We will get the full 8k, there is a federal website that outlines everything. Its not a reason to buy a condo, however it is a good incentive since we were already thinking about buying one. It just motivates us to do it earlier.

 

I am fully aware of what should be done, and what the risks are, I am simply inquiring about the debt to income ratio that is actually used. We will only be tight with money for at most 4 months (assuming we get a place sooner rather than later).

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IMO, a condo is like leasing a car. It gets you into a neighborhood you couldn't have afforded to get into otherwise, just like leasing a car gets you into a nicer car than you could have bought for the same money.

 

At the end of the day, condos are a hard sale. We sold my wife's condo in about a months time (closed earlier this month). But it was in a desireable area where no new condos can be built, was a unique setup, and had some features most condos don't have. It is hard going out there with condos.

 

Also, if you are bringing you two down in terms of getting a loan, then why are you applying or putting your name on it at all? If your debt/income ratio and credit work out better with just your wife, do it that way. Due to my rental property, that's what my wife and I did.

 

Honestly, a house is really the way to go. What newbie condo owners don't understand is condo fee's aren't the only cash the association will get from you. They want to do something and don't have the funds...they will charge an assesment to everyone. My wife was averaging a $500 assesment every year on top of the already sky-high condo fees. Parking lot need re-paved...ASSESMENT. Condos need a new roof? Assesment. Units need painted...well, you get the picture.

 

For many condo's, the cost of fee's alone could pay to have someone mow your yard on a single family home (or snow removal in the winter) + saving the remainder each month would cover any outside repairs down the road. For most people, condos are not a good purchase. My wife bought hers because at the time she traveled for a living and wasn't home enough to feel right with a house.

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Good luck with the purchase, I didn't mean to sound negative or anything.

 

Another note on condo fee's....when I briefly looked into a condo about 2-3 years ago, the nice places had on average a $200 monthly condo fee, and if you figure $200 on top of your mortgage payment, depending on what your rate is, that's potentially another $10k, $20k, etc more that you can afford on a house price.

 

So for example, a $100k condo w/ a $200 monthly fee, or a $125k house w/out the monthly fee.

 

just my .02

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IMO, a condo is like leasing a car. It gets you into a neighborhood you couldn't have afforded to get into otherwise, just like leasing a car gets you into a nicer car than you could have bought for the same money.

 

At the end of the day, condos are a hard sale. We sold my wife's condo in about a months time (closed earlier this month). But it was in a desireable area where no new condos can be built, was a unique setup, and had some features most condos don't have. It is hard going out there with condos.

 

Also, if you are bringing you two down in terms of getting a loan, then why are you applying or putting your name on it at all? If your debt/income ratio and credit work out better with just your wife, do it that way. Due to my rental property, that's what my wife and I did.

 

Honestly, a house is really the way to go. What newbie condo owners don't understand is condo fee's aren't the only cash the association will get from you. They want to do something and don't have the funds...they will charge an assesment to everyone. My wife was averaging a $500 assesment every year on top of the already sky-high condo fees. Parking lot need re-paved...ASSESMENT. Condos need a new roof? Assesment. Units need painted...well, you get the picture.

 

For many condo's, the cost of fee's alone could pay to have someone mow your yard on a single family home (or snow removal in the winter) + saving the remainder each month would cover any outside repairs down the road. For most people, condos are not a good purchase. My wife bought hers because at the time she traveled for a living and wasn't home enough to feel right with a house.

 

Thanks for the information. After talking with a few people, and crunching the numbers, it really doesn't make much sense for us to make a move before we are ready just for the 8k credit. A 3.5% down payment is usually required (if not more) and would essentially eat up most of (if not all) of our 8k credit. Also, we would have to come up with the money right now, which can be put towards lowering our debt putting us in a better place next year. We moved in with my parents to get out of debt, but its hard living here, being married, and knowing you could probably buy a condo/house and survive. However just surviving is not what we want at this time.

 

Good luck with the purchase, I didn't mean to sound negative or anything.

 

Another note on condo fee's....when I briefly looked into a condo about 2-3 years ago, the nice places had on average a $200 monthly condo fee, and if you figure $200 on top of your mortgage payment, depending on what your rate is, that's potentially another $10k, $20k, etc more that you can afford on a house price.

 

So for example, a $100k condo w/ a $200 monthly fee, or a $125k house w/out the monthly fee.

 

just my .02

 

 

Those are all good points, and will be used to make our ultimate decision. However I can't recommend going through with a purchase this year comfortably.

 

Thanks everyone for the help.

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theres things available you dont need a down payment. HUD still has $100 down programs. i got my house thru HUD, and it was in pretty decent condition. needed a little work, but not MAJOR stuff. i could have built in the costs into my loan, but my realtor didnt submit the offer correctly, and instead of waiting another day or two to resubmit it, i opted to close that day...i had to take about 2600 into escrow, but i got all my stuff fixed, and instead of it being built into the loan, it saved me about $16/mo

 

as for the credit, its available until 12/1/09, so youve got 4-5 months to get into a place. its 10% of the purchase price, up to 8k max, unless you and your wife make an ungodly amount of money you get phased out, but judging by your statements, that doesnt seem to be the case right now

 

I don't understand what a measely $8000 matters in buying a house? And that's even IF you qualify for the entire $8000, which do you even know 100% for sure before you've already bought a place? What if you don't qualify after all, or you only get $4000?

 

if he hasnt bought a home in 3 years, doesnt buy it from family, and a couple other stipulations, its 10%. so unless he buys something for 40k, he will get the full 10% up to 8k max. i bought my house for 78000, and i got back $7,859.20 two weeks ago (they paid me intrest for the 3 months. LOL!)

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as for the credit, its available until 12/1/09, so youve got 4-5 months to get into a place. its 10% of the purchase price, up to 8k max, unless you and your wife make an ungodly amount of money you get phased out, but judging by your statements, that doesnt seem to be the case right now

 

 

 

if he hasnt bought a home in 3 years, doesnt buy it from family, and a couple other stipulations, its 10%. so unless he buys something for 40k, he will get the full 10% up to 8k max. i bought my house for 78000, and i got back $7,859.20 two weeks ago (they paid me intrest for the 3 months. LOL!)

 

DO you have to submit something to the government to get this after you buy your house?

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