FHA Loan Information Request

[Anonymous]

I am finding bits and pieces of what I'm looking for but would really appreciate answers to my questions relating to my specific situation. Any help is very much appreciated. My situation is as follows:

• I currently make $52,500 per year
• I have debts with monthly payments of:
  • Car - $343
  • CC - $15 per month (for reporting purposes)
  • Student Loan - $271 (However, I do not pay these. My parents do.)
• My credit scores are hovering around 730. I have a 120 day late from four years ago due to getting mono in college and unable to work to pay CC bill. Too embarrassed/ignorant to call CC company and explain situation. I know, stupid. My credit scores are helped by the fact that I have a 25 year credit history. However, I am only 25 years old. My dad added me as an AU a long time ago and AmEx backdated my card when I applied a couple years ago)
• Desired townhome price - $147,700
• Semi Annual Tax of $850 for desired townhome
• HOA - $183 per month
• Desired loan - FHA
• Desired closing date - April 15, 2010
• Checking - ~1,500
• Savings - ~$3,800
• 401k - $1,800
• Currently saving $1,300 per month
• Desired loan - FHA ($147,700 X .035 = $5,440 downpayment required at closing)
• Currently saving $650 per pay period (bi weekly)

With 5 pay periods left until this time, and my tax return of about $1,000, I anticipate having roughly $8,000 available for the home by April 15.

My questions:

1. Does it make a difference when calculating DTI that my parents pay my student loans if I can prove this?
2. Will it make a difference that I do not truly have 25 years of credit history to the lender? Will this negatively impact consideration for the loan?
3. Will $8,000 be enough for the downpayment and all additional costs? If not, how much would it require?
4. A good friend of mine is a realtor who is willing to not take a commission. Does this leave room to request the seller to reduce the price of the townhome or does this not matter at all?
5. Do you have any other advice for me? Am I missing any other important factors here?

I can't tell you how much I will appreciate anyone who will take the time to help me out. So, Thanks in advance.

[Anonymous]

Based on your income, you have about 1900 per month for debts.

roughly 600 of that is already tied up into debt.  This leaves about 1300 for a mortgage. It should work DTI wise as your payment should fall under the DTi limits or at least be tight enough to make a case for more.

Student loan payment will probably be counted.  It is the underwriter's discretion, they can waive an item being paid by someone else if there is a paper trail.  But, that is usually more for when something is cosigned, a divorce situation, etc...Not someone who gets parentla help to pay student loans that are in their name.

8K would be pushing it.  You will need on average 500-1000 for appraisal and a home inspection  (appraisal required and inspection highly recommended)

The cash down payment would be 5500 or so....Thus leaving you with only about 1500-2000 for all closing costs and moving costs.  While it is entirely possible that the seller may agree to pay closing costs, you can not count on it and depending on different factors, the closing costs alone could easily run 5-8K by itself or even more in some areas.

Last, having your realtor work for free does not lower the sales price.  The sellers generally sign a contract with the realtor determining a set % of the sale (5-7% usually).   There is a clause agreeing to split the fee with another realtor if one is onvolved, but not usually one that lowers the commission if there is not another involved.  It would not be in the sellers control to lower the price based on this, and the selling agent would have no reason to.  It is a common misconception that only having 1 paid realtor saves anyone money.  Also, there are professional liabilities in your friend doing this for you (and I personally had to fire my freind as a realtor) so I would highly recommend either having the friend help for pay and wiht a very clear discussion of boundaries and the gameplan, or hiring an outside, unbiased realtor.   One exception to the lowering of the realtors fees is if the house appraisal comes back low, or there is some other hurdle that pops up, the realtor may lower a little bit to help get the deal doen rather than loose all the time they have in, but at initial offer/negotiations it may be tough to get that. 

[Anonymous]

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@Anonymous wrote:

Based on your income, you have about 1900 per month for debts.

roughly 600 of that is already tied up into debt.  This leaves about 1300 for a mortgage. It should work DTI wise as your payment should fall under the DTi limits or at least be tight enough to make a case for more.

Student loan payment will probably be counted.  It is the underwriter's discretion, they can waive an item being paid by someone else if there is a paper trail.  But, that is usually more for when something is cosigned, a divorce situation, etc...Not someone who gets parentla help to pay student loans that are in their name.

8K would be pushing it.  You will need on average 500-1000 for appraisal and a home inspection  (appraisal required and inspection highly recommended)

The cash down payment would be 5500 or so....Thus leaving you with only about 1500-2000 for all closing costs and moving costs.  While it is entirely possible that the seller may agree to pay closing costs, you can not count on it and depending on different factors, the closing costs alone could easily run 5-8K by itself or even more in some areas.

Last, having your realtor work for free does not lower the sales price.  The sellers generally sign a contract with the realtor determining a set % of the sale (5-7% usually).   There is a clause agreeing to split the fee with another realtor if one is onvolved, but not usually one that lowers the commission if there is not another involved.  It would not be in the sellers control to lower the price based on this, and the selling agent would have no reason to.  It is a common misconception that only having 1 paid realtor saves anyone money.  Also, there are professional liabilities in your friend doing this for you (and I personally had to fire my freind as a realtor) so I would highly recommend either having the friend help for pay and wiht a very clear discussion of boundaries and the gameplan, or hiring an outside, unbiased realtor.   One exception to the lowering of the realtors fees is if the house appraisal comes back low, or there is some other hurdle that pops up, the realtor may lower a little bit to help get the deal doen rather than loose all the time they have in, but at initial offer/negotiations it may be tough to get that. 

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The home is a spec home and was built just a few months ago. Would a home inspection still be recommended?

[Anonymous]

personally I would say it is just as important, if not even more important.  Certain things will be apparent on a house if it has been lived in for awhile, but may not appear at all on a new build.  In the end, before you invest 150K in a house, it is worth the 3-400 for the inspection.

While a new home builder will warranty the home for a certain time period, you want some sort of outside inspection to make sure the builder did not cut corners to make the home quicker/cheaper/etc.  

[Anonymous]

If the seller won't cover closing costs, can these be rolled into the loan?

[Anonymous]

no.  They have to be paid.