I am interested in purchasing a home. My credit score is in the 650's. I have between 8-10K to put down. I earn about 80k a year gross 60 salary 20 bonus. My current expenses are about 8-9 hundred a month. How much can I afford to borrow? My current rent is 1050 a month, so I would not want my monthly payment to be much more than 1200.
2007-11-15 07:53:03 · 5 answers · asked by kkarkutt 1 in Business & Finance ➔ Renting & Real Estate
For a payment of $1200- ONLY principal and interest- at 6.0% over 30 years would get you a $200,000 loan amount. Of course you need to add in taxes and insurance to that payment if you escrow which will bring your loan amount down if you need to keep to that $1200 budget. Also you say you have $8- 10K for down payment- but do you have more for closing costs or is it 8-10 total?
2007-11-15 08:16:15 · answer #1 · answered by flamingojohn 4 · 0⤊ 0⤋
Are you interested in purchasing a house or interested in getting into the ball park of what you will pay per month.
There are lots of things that go into determining your monthly payment as well as if you are qualified for a morgage and which mortgage program you are qualified for.
Because you have a certain credit score does not mean that you will qualify for the same mortgage program as another person that has the same score. His ratios could be lower or higher than yours thus putting you into a different mortgage program.
All banks just about offer the same products and loan programs with the different qualifications in each of their programs.
Your interest rate is based on your credit score and how well you have paid your consumer debt over time, not by the company that does your loan or even complete the paper work for your mortgage application.
In order to find out the type of loan programs you are qualified for you will have to fill out a loan application, with a mortgage broker, which you can find one in your local telephone book.
He will fill out this application, which takes awhile so grab your favorite beverage and sit down. Once you have completed the application, he will run your credit report which will have your credit scores. These credit scores will determine your interest rate.
The amount of your monthly debt payments you are required to pay as per your credit report and the amount of mortgage you can take on based on your income will determine the amount of house you will be able to purchase.
When you speak with the mortgage broker you will need the following documents to complete the loan application
#1 One month of pay stubs for each person that will be on the mortgage.
#2 Six months bank statements from each bank in which you bank as well as statements from any 401K from you place of employment.
#3 Two years of federal income tax along with the W-2 that match.
Once he has all that he need to do he can then issue you a pre-approval letter so you can purchase a home.In this pre-approval letter will be the amount of house you are qualified to purchased.
Once he gives you this pre-approval you may now find a real estate agent to find yourself a home or he might have a referral.
Now make sure before you get your pre-approval you and your mortgage broker go over all your options as to the mortgage programs you qualify for, the interest rate, monthly payments.
You should also get a Good Faith Estimate (GFE) which will indicate the cost you will have to pay for getting this loan. It will also indicate the amount of your down payment.
Once you have found a home the real estate agent will then prepare a contract for you and the seller to sign.
Your mortgage broker will now order an appraisal to show proof of the property value.
The mortgage broker might ask for additional information or documentation, don't get all up tight this is normal, just supply the information or find the documents needed.
After the appraisal has been completed you will be called by your mortgage broker to sign your loan docs so you can take possession of your new home.
Before signing any loan docs make sure they say exactly what you and your mortgage broker went over when you decided on what mortgage program was best for you.
I this has been of some use to you, good luck
"FIGHT ON"
2007-11-15 08:07:42 · answer #2 · answered by loanmasterone 7 · 1⤊ 0⤋
Ironically, I was in a similar position as you for my last home purchase. I ended up going with a 205K home and at 10K down my payment is around 1300 a month. Of course, interest rates are a bit different than they were then, however this is a ballpark...
2007-11-15 08:00:25 · answer #3 · answered by nappyjim4 2 · 0⤊ 0⤋
It depends on many factors, including the interest rate you get, but conservatively, guessing a 7 percent fixed rate, you qualify for about $133,000 on a 15 year loan or $180,000 on a 30 year loan
2007-11-15 08:05:49 · answer #4 · answered by Lisedeen 2 · 0⤊ 0⤋
Depends on your interest rate, but I’d estimate $150,000. Talk to some local lenders to be certain.
2007-11-15 07:57:23 · answer #5 · answered by Anonymous · 0⤊ 0⤋