Bah, I had this long post all typed out then hit a button and lost the whole thing so....TAKE 2!
My husband and I are ready to buy a home. I enjoy monitoring my credit and like to see the fluctuations when I leave a balance, don't, etc. It's kind of a hobby as I'm sure it is for a lot of the people who come to this board. I like that I can give advice on CC's and credit to people who ask. When it comes to this mortgage process though, I am completely clueless and I don't like it. Our real estate agent says "No problem, I will walk you through it as will the great broker". While this might be okay for some, it is totally freaking me out that I am not knowledgeable about this situation.
I have some questions but first I'll post the info from the "Will I Qualify" sticky in case any of that info is needed for my questions:
- Credit. My EQ is 725 (as of this week), TU is 698 (as of beginning of May), EX unknown. Hubby's EQ is 703 and that is the only known score. My balances are higher than normal right now, I let balances report last month. I was at about 35% I'd say and he's at 42% UTIL. I typically pay my balances every month as I run all my expenses through CC's. Hubby is paying off large purchases so he carries balances, although we could pay off if needed.
- Income. Our combined income is about 140k before his bonus. They have restructured his bonus plan this year so we aren't exactly sure how much it will be.
- Source of income. A portion of my income is commission/bonus based. My income from salary is about 45k, to be conservative on my commission and bonuses I will say that that is 20k. My commission is fairly consistent in each check and bonuses are paid quarterly. Most of hubby's pay is consistent every pay period, with the exception of his yearly bonus which will not be paid prior to our home purchase so I guess it won't be a factor anyway. One question that I have is in regard to income in the last 2 years. We both began making much more money about halfway through last year so even our tax returns from 2012 do not report near the income we are currently at...will that be an issue or will more weight be put on our current pay?
- Monthly debt payments. I have about 50k in student loans on which my payments are about $450. I haven't consolidated or changed my payment plans since I don't have an issue making the payments. Now I'm kicking myself for not at least consolidating because it seems that would help me out on the mortgage if my monthly payment were less but I don't think it's that big of a deal. On hubby's CC's and a no interest account he put part of my wedding ring on, the monthly payments are like $300. No car payments or anything else.
- Employment (for those who are employed). We are both FT employees. I have been at my company for 2 years and he has been in the same industry for probably 3 years, same company for over 1.
- Assets/Reserves. We don't really have any assets at this point. Have like $7500 as of this moment saved for downpayment.
- Location. Tampa (Hillsborough County), FL
- Property. We will be purchasing a single family home, have not found anything yet so no details here.
- Value. We are definitely not looking to go crazy on what we buy. We're not ones to spend all we can afford on housing or cars or anything (hence the no car payments). I'm thinking 180k-200k, he is thinking a bit above 200k. We will figure it out as we start looking I guess.
- Occupancy. Primary residence
- Transaction Type. Purchase
Now for my questions 
With our scores around 700+ and pretty easily raised at least a bit by paying down even a bit of our high UTIL, would my money be better spent to continue to save for a down payment or to pay down our balances all the way. Not sure about the pre-qual amount...with things as is would we likely be approved with where our debt is for an amount within where we are looking? I don't think (but I could of course be wrong seeing as how I know nothing about mortgages) that the difference in making those payments would affect the interest rate much so am thinking from there I'd be better off saving more. But it could still affect the amount we are pre-qualified for correct? So basically...are we better off paying down balances right now or increasing our down payment savings? Even if we pay things down we should have at least 10k saved once we actually purchase.
With my student loan situation...as we are within months of wanting to purchase, I assume I am better off leaving it how it is as opposed to consolidating as I know that opens a new tradeline. Correct? That being our only real monthly debt I am hoping this difference wouldn't be TOO big of a factor.
I bolded this one in the info above but...in regard to income in the last 2 years..we both began making much more money about halfway through last year so even our tax returns from 2012 do not report near the income we are currently at...will that be an issue or will more weight be put on our current pay?
I'm sure I have a million other questions that have crossed my mind at some point but I guess those are the biggies that I can think of right now.
I'd like to be in the best situation possible before I even do the pre-qual with the broker so I'm trying to figure all this out to ensure that we are pre-qualified for the amount we will be looking to buy at. It seems like income and credit-wise we are in a better situation than a lot of people we know who have purchased homes so I'm hoping that this will be relatively pain free, except of course for my crazy worrying and nitpicking which is inevitable.