I am going to get to pre approved for a morthgage soon.. I was wondering...??

Question

if anyone knew about what I should expect to be pre approved for.

Me and Wife make around 110k a year COMBINED. My credit score is around average hers is probably just a little less then mine. But Im sure neither of us have "bad" credit. We have a little credit card debt, nothing horrible , and only 1 car payment.

Can someone give me an estimate of about what we will be approved for?

Answer 1

Based on what you said, the bank is going to be quite generous with you. Mostly because your income is above average and you have decent credit.

I would think they would max you out at around 350k of a mortgage assuming you cant get a 10% down payment on your house. That would be "agressive" though. A more targeted mortgage may be between 300-325k.

Remember that they work on commission, so they might try to strain your budget if possible.

Alot of people chase their "dream" house and end up paying more then they should for it. Dont forget , you still want to do things like travel -- so dont be a slave to your housing payments.

Answer 2

You will probably get approved for much more than you can comfortably afford. Many people get themselves into trouble when they take out the largest mortgage they can find.

Conventional wisdom says spend no more than 28% - 33% of your gross income on housing. This includes principal, interest, real estate taxes, insurance, association fees (if any) and PMI (if any). In addition, you should spend no more than 36% - 40% of gross income on all debts, this adds in car loans, credit cards, student loans, department store easy credit financing etc.

Look at your specific situation. What do you spend on housing now? How much (if anything) are you able to save after you pay all your bills? How much can you afford your housing expenses to increase?

Answer 3

You will want to get a good mortgage broker who can shop around with several lenders for you. Let him/her do the leg work for you. It really will depend on what your actual credit score is. When you say your score is average, it leads me to believe it is around 595 though the internet touts that the average is 678. That is a big gap. I recommend reviewing the online free evaluation form at

www.totaldebtsolutionsllc.com

and letting them recommend a loan officer from their nationwide network who can say "yes" regardless of where you fall within that window of "average."