Is Now the Right Time?

Anonymous · ‎01-12-2017

Started on this forum about a year ago - had a lot of work to do and so appreciate all of the information that is available here

My question for today is: Is Now the Right Time to apply for a mortgage?

Income: $112,000 - W-2

Utilization: approx 22% - going down each month

DTI: (if I am calculating correctly) 15% / 36.34%

Last late: January 2015 - it was a mortgage late at 30 days

Purchase price: 275,000 - 325,000

Downpayment: 20%

State: Maine

Current FICO mortgage scores: EQ: 700 - TU: 707 - EX: 736 (my starting mtg scores were 631/670/633 so I really appreciate all that I have learned here)

Current FICO scores: EQ: 748 - TU: 749 - EX: 741

I have no current mortgage as I sold my house in July and have been able to use that money to pay down a significant portion of debt (living with SO so have no rent payment either)

Is now the time?

All input and/or inight welcomed!!!

Thank you - LP

StartingOver10 · ‎01-12-2017

Looks good to me from the info in your post! You are putting down 20% so you don't have to worry about PMI.

Can I ask what you are using for the front end (housing) ratio? In theory, that number would be zero now since you don't have your new home picked out yet. If you are using your SO's mortgage payment because you both plan to keep his/her home then that makes perfect sense.

Anonymous · ‎01-12-2017

So I may have it backwards

I was using my current payments/gross income - and then I added my current payment + anticipated mortgage amt/gross income

I also did not put in my original post that I did have a BK in 2008 - concerned that the late payment after the BK may affect obtaining a mortgage

Thank you!!

StartingOver10 · ‎01-12-2017

@Anonymous wrote:
So I may have it backwards

I was using my current payments/gross income - and then I added my current payment + anticipated mortgage amt/gross income

I also did not put in my original post that I did have a BK in 2008 - concerned that the late payment after the BK may affect obtaining a mortgage

Thank you!!

Are you keeping SO's house? Will it be rented?

Have you tried to GW the late off even though the mortgage has been paid off? The u/w will ask about it for sure. It does increase the lenders' risk if you have a late after a Bk. Will the new home payment be similar to the old home payment or less (or more)?

Anonymous · ‎01-12-2017

Keeping the SO's house - the house is in his name only

New mortgage would be in my name only

I have not tried to GW the late - thought I might leave well enough alone and write a Letter of Explanation if need be

I was hoping 20% down and MMS of 707 would be helpful.....

The new home payment I suspect will be less because I plan to initially do a 30 year payment - my previous mortgage was a 15 year so the payments were higher

Plan is when SO retires we take a lump sump of his annuity and pay down my mortgage and sell his house - this will not be for three more years however

Maybe I have to wait another year until the 10 year mark for the BK - almost two years as it was in November - definitely live and learn!!!

StartingOver10 · ‎01-12-2017

@Anonymous wrote:
Keeping the SO's house - the house is in his name only

New mortgage would be in my name only

I have not tried to GW the late - thought I might leave well enough alone and write a Letter of Explanation if need be

I was hoping 20% down and MMS of 707 would be helpful.....

The new home payment I suspect will be less because I plan to initially do a 30 year payment - my previous mortgage was a 15 year so the payments were higher

Plan is when SO retires we take a lump sump of his annuity and pay down my mortgage and sell his house - this will not be for three more years however

Maybe I have to wait another year until the 10 year mark for the BK - almost two years as it was in November - definitely live and learn!!!

No, you are better off now than waiting a year. I think your plan of getting a 30-year repayment rather than a 15-year repayment will help the u/w + you expect the overall payment to be less.

The 20% is a major help. When you speak to a LO ask if it would help if you put down 25% rather than 20% - sometimes a little extra down payment can help. Your LO should be able to give you good guidance as to how to overcome that late payment two years ago. Maybe just the LOE will work.