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First Time Poster with Mortgage Questions (or thoughts...)

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Anonymous
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First Time Poster with Mortgage Questions (or thoughts...)

Hi everyone.  First time poster, long time lurker.  As background, we are renting a house in Southern Maryland right now.  The owner wants to refinance, but she also asked if we'd like to buy the house instead.  We are seriously considering this with the low interest rates and the fact that we actually like the house.

 

Since her question to us about buying the house, I've pulled my Fico scores and I know we don't have any issues there (TU - 747, Eq - 751, Ex - 749).  At this point, we are thinking of only putting the mortgage in my name as my husband has a much smaller income and much of our credit card debt is in his name (but we have no problems paying them).

 

Our landlady is willing to provide some closing and the fact that neither of us would need a realtor is also a plus (and the fact that I wouldn't have to move or look for another house down the road Smiley Happy )

 

We are thinking of going with an FHA loan as a first time home buyer and we can easily afford the 3% down. My concern is finding a lender that is reputable and well, not going to screw (can I say that?) us over.  That and I have that knot in the pit of my stomach just like when we go buy a new car - it's great thinking about, test driving it and all, but then you have to go to finance....

 

 Other pertinent information:

 

Time at present job:  9 years in May 

Yearly income (just mine):  $90k

 

I don't think we will have an issue getting an FHA loan, but are there other options that we should look at?  Also, I received a substantial raise/promotion that will just now be showing up on my paystub.  Will I need to wait several pay periods to prove my higher pay?  

 

Any other thoughts, suggestions, etc?

 

Thanks!

 

Kate

 

Message 1 of 3
2 REPLIES 2
DallasLoanGuy
Super Contributor

Re: First Time Poster with Mortgage Questions (or thoughts...)

a good lender will tell you if conventional financing is a better deal for you.

apply.

bring your gfe here and we will tell you if you are getting screwed or not.

 

Retired Lender
Message 2 of 3
Anonymous
Not applicable

Re: First Time Poster with Mortgage Questions (or thoughts...)

Hi Kate, Smiley Happy

 

Your scores are phenomenal and FHA is a great option for you. Smiley Happy

 

You may not realize it, but you can also apply for a USDA Guaranteed Loan,

where a local lender makes the loan and the USDA guarantees (insures) it.

Qualifying middle FICO scores are only 620 for the best rates, which are running 

about 5.3 - 5.5% fixed for 30 years. These loans are 100% financing, so no

downpayment is required. Smiley Happy

 

These loans do have a qualifying income limit, but the USDA just modified their

income charts to allow more people to take advantage of their loan program.

The changes don't "officially" go into effect until on/about March 20th, 2009

but certain lenders like Chase and Wells Fargo are qualifying and approving

people based on the modified income structure. And even with your salary of

90k/year you still qualify. Smiley Happy

 

The USDA used to have 8 separate qualifying incomes, but now they only 

have two: one for 1-4 person households (which is the "old" 4-person limit)

and another for 5-8 person households (which is the "old" 8-person limit).

The USDA also allows applicants to earn up to 115% of the median income in

your area and still qualify for a Guaranteed Loan. Smiley Happy

 

The link to the USDA information can be found below.

 

Just click "Maryland" and a pdf chart with income limits will appear.

Focus on the numbers for the moderate income guaranteed loan program

in your county or metro area in which you reside. Ignore the "Low Income"

numbers --- that's a different program that doesn't apply to you.

 

Since you're the only one qualifying, look for the 4-person limit. That's the

amount that applies to 1-4 person households. Then multiply that number

by 1.15, because applicants are allowed to earn up to 115% of the median

income where you live:

 

I think you will find that you qualify quite easily for the Guaranteed Loan. Smiley Happy

 

http://www.rurdev.usda.gov/rhs/sfh/sfh%20guaranteed%20loan%20income%20limits.htm

 

Anyway, it's just another option. If you guys are happy with FHA or conventional,

by all means go for it. But the USDA guaranteed loan is there for you to take

advantage of, and Chase and Wells Fargo would be good places to start.

 

Hope this helps, Kate. Enjoy the evening! Smiley Very Happy

 

CanDo

 

"The right attitude is everything"

 

Message Edited by CanDoAttitude on 01-18-2009 05:56 PM
Message 3 of 3
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