First Time home buyer mid-next year...FHA loan?

[HiFromSeattle]

Hi All,

I am looking at purchasing my first new home. I live in Seatte, where the costs are just skyrocketing for any decent house in the area, even beyond the city. There are a few areas I have identified that currently have decent inventory around what I believe my price point is. I am not looking at purchasing just yet (still saving a little more and I have been told I am about to get a raise at work, so if that goes through, then these numbers could go a little higher; no, my income below does not factor this in).

Basically, I'm just tired of paying $2,100/month for a small apartment and just wasting away while the market gets worse and worse around me.

I am looking at putting 3.5%-5.0% down and using an FHA loan. Here are my stats:

1. Mortgage Credit Scores:  

• 715-730

2. Credit Negatives: 

      NONE

3. Gross Income. 

    $90,000

4. Source of income

    Only counting my full time income above, but I do get $300-400/month for outside consulting

5. Monthly debt payments. 

• Auto Loan: $330/month
• Student Loans: $350/month (have a year of defferment left if I chose, but I'd rather not).

6. Employment (for those who are employed). 

Type of employment: 

• Salary full-time
• Contracting W-2

7. Assets/Reserves. 

       $40K in savings as of today.

8. Location:  

    King County, WA
    Snohomish County, WA

9. Property Description: 

• Single family home, in seemingly good shape, modern.

10. Property Value. 

• I believe my price point is somewhere in the realm of $300,000-$375,0000

11. Occupancy. 

• This will be my primary residence, I'll be living there with my gf, who will pay a certain % of rent, but do not want her income included.

12. Transaction Type.  Purchase

Other Note: My oldest credit card is turning 6 during the time I'll be seriously shopping. Average credit age is 4 years. I have 5 open credit cards, all with >5% balance at any given time (I pay them off each month). Car loan will be 2 years old.

Also wanted to add that according to data on Zillow, the areas I am looking at buying are appreciating at 7-9%/year for the past two years. Rent is appreciating 10-12%/year. Yikes.

[HiFromSeattle]

1. Mortgage Credit Scores:  

• 715-730

2. Credit Negatives: 

[HiFromSeattle]

      NONE

[HiFromSeattle]

3. Gross Income. 

[HiFromSeattle]

    $90,000

[HiFromSeattle]

4. Source of income

[HiFromSeattle]

    Only counting my full time income above, but I do get $300-400/month for outside consulting

[HiFromSeattle]

5. Monthly debt payments. 

[HiFromSeattle]

• Auto Loan: $330/month
• Student Loans: $350/month (have a year of defferment left if I chose, but I'd rather not).

6. Employment (for those who are employed). 

Type of employment: 

• Salary full-time
• Contracting W-2

7. Assets/Reserves. 

[HiFromSeattle]

       $40K in savings as of today.

[HiFromSeattle]

8. Location:  

[HiFromSeattle]

    King County, WA
    Snohomish County, WA

[HiFromSeattle]

9. Property Description: 

• Single family home, in seemingly good shape, modern.

10. Property Value. 

• I believe my price point is somewhere in the realm of $300,000-$375,0000

11. Occupancy. 

[HiFromSeattle]

• This will be my primary residence, I'll be living there with my gf, who will pay a certain % of rent, but do not want her income included.

[HiFromSeattle]

12. Transaction Type.  Purchase

[HiFromSeattle]

Other Note: My oldest credit card is turning 6 during the time I'll be seriously shopping. Average credit age is 4 years. I have 5 open credit cards, all with >5% balance at any given time (I pay them off each month). Car loan will be 2 years old.

[HiFromSeattle]

Also wanted to add that according to data on Zillow, the areas I am looking at buying are appreciating at 7-9%/year for the past two years. Rent is appreciating 10-12%/year. Yikes.

[StartingOver10]

You look like you are in excellent shape to me!

The one thing I would like to mention is FHA has mortgage insurance, two types:  UFMIP and monthly for the life of the loan with one exception.

The UFMIP can be rolled into your mortgage.

If you put down 10%+ on your purchase rather than 3.5% to 5%, your MIP drops off after 11 years. If you plan to be in your new home for a long while this could be a good benefit to you because you don't have to refi at some unknown date with an unknown interest rate to drop the MIP. Naturally I know it takes more to come up with the extra DP.