My wife has a credit score of 650, and I have a 620. We are both working on improvement of those scores. She does not have a job, I am active duty military 7+ years. We want to buy a home that costs about 180k. Annual income is about 41k. Will we qualify? Will they combine our FICO scores or just use mine since I am the only one currently working?
What is the best type of loan to get. I know to try using the VALoan. But what is best? Interest only loans? etc.
2006-09-12 18:08:38 · 3 answers · asked by Rudy K 2 in Business & Finance ➔ Renting & Real Estate
If you put 20% down, borrowing $144000 total. With 30 year fix, the rate is around 6.75%. The monthly mortgage is probably $940.00. Let's assume tax benefits cancels out with property tax and maintenance.
Is $940/mo. an ok amount for you? If you do interests only loan, the monthly payment is about $870/mo. However, that means you will not be paying into the principle.
Mortgage payment consists of two parts: interests and principal. Interests are like rent, which doesn't add to the equity to your house. It simply disappear as your pay it.
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Would you consider delaying your plan? The housing market is slowing down.
http://money.cnn.com/2006/09/08/real_estate/caught_in_the_bubble/index.htm?postversion=2006090814
http://money.cnn.com/2006/09/05/real_estate/Ofheo_home_prices/index.htm?postversion=2006090514
If you don't plan to delay your plan, please interview several and pick a good realtor or agent.
Bad ones will talk you into buying the largest property at your credit limit. Good ones will find you a good deal (Sellers are offering discount and incentives now).
Try to stay away from Adjustable Mortgage, because 30 year fix mortgage rate is very low right now. There is no reason to use Adjustable loans except fatter commission for loan agents.
Interests only loans are not good iether. Mortgage payment consists of two parts: interests and principal. Interests are like rent, which doesn't add to the equity to your house. It simply disappear as your pay it. If you want to use interests only loans, might as well rent, especially during market downturn, because housing price won't appreciate.
Good luck!
2006-09-12 20:43:48 · answer #1 · answered by Price is what you pay for value. 3 · 0⤊ 0⤋
The best thing to do is make an appointment with your bank and or a mortgage broker. We just qualified for 0% down and over 250,000. My husband is the only one working and we take in about the same amount. I would really try to make that appointment. The sooner you do the happier you will be when you finally own a home of your own. Good luck and remember its a stressful process but the results are gratifying!!!
2006-09-13 01:36:49 · answer #2 · answered by Anonymous · 0⤊ 0⤋
Lending institutions all have their own rules for determining eligibility. We have our mortgage at our credit union, they have simple-interest mortgage loans, which are a miracle. Tread carefully on those variable-rate loans. Interest rates are going to go up over the next several years. Good luck to you and your wife.
2006-09-13 01:13:21 · answer #3 · answered by Computer Guy 7 · 0⤊ 0⤋