We are looking at a home valued at $447k in northern CA. His credit is good (716) and mine is not (516) a combined income of over 120k. What do you think our montly payments would be and what are some recomended loan options for first time buyers? 0% down 100% financing...thanks!
2007-08-13 12:04:17 · 6 answers · asked by Jessica S 4 in Business & Finance ➔ Renting & Real Estate
To DJB: The point of yahoo answers to get a large amount of responses and advice from many different people. I am very far from lazy and have done pleanty of research as well as meet with Realtors and brokers. I was hoping to get advice from people in a similar situation and see what they received as their loan terms or get advice. Don't be so rude.
2007-08-13 12:34:08 · update #1
Jessica,
Greg is right about the lending market being in chaos right now. Jumbo loans are over 417k and really hard to get right now. That means you'd have to put down at least 30k to fit under the jumbo. 0% down is really tough right now.
You are also exceeding the general rule of thumb to pay between 2x and 3x annual income for a home. I know that's tough in Northern CA, but you really shouldn't be looking over $360k.
Do the calculation for the 28/36 rule also. No more than 28% of your monthly income should go to your housing payment (principal, interest, taxes and insurance and PMI). Your payment shouldn't be above $2800 per month. 0% down will put you in Private Mortgage Insurance (PMI) land which could run a few hundred bucks a month. The 36 part of the rule is that all debt payments shouldn't total more than 36% of your monthly income ($3600 per month in your case). I don't think you can fit a zero down, $417,000 loan with taxes, insurance and PMI under $2800. As a matter of fact it might not all fit under $3600.
You might be able to find a lender willing to go with higher ratios, but then you are going to be house poor, will all of your money going to service the loan on your house and you will have no cash to do other things.
Suspect financial decisions, like buying this house looks to me like the way you got to a 516 credit score. Sorry, just being honest. Good luck!
2007-08-14 05:48:27 · answer #1 · answered by Rush is a band 7 · 0⤊ 0⤋
I work for one the largest banks in the country. Right now we are having some turmoil on wall street for any loans not sold to gov't agencies (fannie mae/ freddie mac). 100% financing is essentially gone except for those gov't programs. Unfortunately they are capped at a loan amount of $417K. If you go over that amt the banks have to carry the loan on their portfolio (own money). The rates are much higher than just two weeks ago, 7-8% rates are common on jumbo loans even with 700+ scores. I've seen 9-10% rates on 30yr fixed notes. It's insane.
I suggest you find a lesser priced home or you'll need to come in with some cash. The high loan to value loans are gone unless you have good credit and bring the sales price down to 417K.
2007-08-13 13:01:35 · answer #2 · answered by Richard S. 3 · 0⤊ 0⤋
Tricky question. If you do a 30 year, 100% financing, at 6.5% interest rate, you're looking at about $2,826 not including P.M.I.(Private Mortgage Insurance), taxes, home owners insurance, hoa, etc... If you put 20% down you would eliminate P.M.I., and bring down the monthly about $600 - P.M.I. which should reduce the payment even more, but, you would still have other costs like the fore mentioned. Lets say that you put 5% down, and get 7.2% interest, you would pay even more than 0 down and 6.5% interest.
Also, since your credit is not so good, you may get a higher interest rate. I think you should read your contract carefully before you sign. Many borrowers took out loans that offered great initial payments but may reset or balloon beyond their capacity to afford them. So becareful of what you actuall sign.
2007-08-13 12:27:26 · answer #3 · answered by Ulises Romo, REALTOR 1 · 1⤊ 0⤋
your score is high enough to get a good rate but there
without knowing more average say 30 yr fixed with a rate the national average is 6.850 is payment not including tax and insurance is 2929.00 a month
i have refinanced my home and saved 120k in added intrest on this site. the rate was 1% less than the best of three rates and there fees where the lowest considering the higher rates offered by the others. check them out they blew the competition away
there are great sources for a better rate consider
www.directlendingplanet.com
2007-08-13 12:17:36 · answer #4 · answered by Anonymous · 1⤊ 0⤋
Going fees on a 30 year fastened are approximately 5.625% on the instant. So he'd have a fee of $1440. belongings taxes and coverage can selection substantially via area, yet i could anticipate yet another $350-4 hundred/mo. mixed. $1800-1850/mo. is approximately 35-38% of his $5000 month-to-month earnings. which could be high quality, if he would not have plenty different debt. yet whilst they have a motor vehicle loan or 2, it may start up getting tight. they could constantly pay off some debt and finance extra on the abode to hold their usual funds in line.
2016-10-02 06:38:41 · answer #5 · answered by ? 4 · 0⤊ 0⤋
Jessica, we yahoos aren't all loan officers! You can get online and find a calculator to tell you this. Don't be so lazy. Do your own homework. If you want definitive information, I strongly urge to seek professional help from a lender. It doesn't cost you anything, unless you sign an agreement with them. In some cases you can do it on-line. Just use local lenders, not those listed on the Internet. Some are pretty shady.
2007-08-13 12:24:50 · answer #6 · answered by Anonymous · 0⤊ 2⤋
thanks to each and everyone of you for the replies.
2016-08-24 12:01:31 · answer #7 · answered by Anonymous · 0⤊ 0⤋