Does Builder's incentive contribute to total cash in the bank for Approval

[joshall]

So the builder will contribute $5000 as an incentive which can be used towards closing.

So far our situation is:

$42,000 needed at closing

We have $38,000 in the bank

We have $21,000 in 401k.

What is the chance of us getting preapproved?

Thanks!

[ShanetheMortgageMan]

The builder's incentive is usually a closing cost credit applied to the amount you owe at closing, reducing the funds you need by the same amount.

If you are using the $38k, then if you owe $42k at closing (before the $5k incentive) then you'd only owe $37k instead.

Much more information is needed to answer your question.  The information needed can be found on a list I made at http://ficoforums.myfico.com/t5/Mortgage-Loans/Do-I-qualify-for-a-mortgage-Info-that-is-needed/td-p/...

[joshall]

Thanks. That is what I thought too.

Do you think only having $1000 leftover after closing looks bad on the applicaion process?

My current credit score is 710 and am aiming for 760 by August.

[ShanetheMortgageMan]

You'll still have your $21k in the 401k (although when using retirement accounts only 60% of the vested balance qualifies) which should be sufficient, so I don't see any issues there.