Reply
Established Member
Sup3Rmari0
Posts: 20
Registered: ‎10-31-2012
0

Mortgage Qualifying/ pay down student loans?

Hi Everyone!

 

Trying to strategize for a future home purchase since the other two didn't work out. due to low appraisals. I am looking in the $240-260k range on a new build....have not made any moves yet, or done a new prequal.

 

I have no other debt except student loans which are at 53k. Since I have money save from my home purchase attempts, I was looking at paying $5k to get them down to $48k. I hold a PT job, and freelance a lot since I'm still single with no kids. That puts me at $65k or so with salary + PT income. This is not including end of year bonus at work...I'm estimating it at 5k. 

 

After doing this, I will still have money for down payment (5% conv.), and some savings.

 

In doing this...paying down to 48K....will this help me to qualify for a slightly larger loan?  

Is there anything I'm not considering?  

 

Also...I'm not in a hurry either and could pay more, but don't want to get my savings too low. 

 

 

TIA!

 

 

Super Contributor
ShanetheMortgageMan
Posts: 8,174
Registered: ‎09-28-2007
0

Re: Mortgage Qualifying/ pay down student loans?

It's not the amount that is owed that impacts what you can qualify for, it's the monthly payment... so unless your monthly payment on the student loans is going to be lowered by you throwing $5k at it, then you won't see any difference between what you can qualify for after you pay it down.  You'll just be $5k poorer in the bank.

 

How long have you been at your part-time job for?

Do you claim your freelance income on Schedule C or are you W-2'd for it?  How long have you had that type of income for?

Established Member
Sup3Rmari0
Posts: 20
Registered: ‎10-31-2012
0

Re: Mortgage Qualifying/ pay down student loans?

Three years on the freelance and PT job, so I've filed both since 2010, in addition to my traditional salary.

 

If the payments wont help...I will save my 5k!  lol

Super Contributor
ShanetheMortgageMan
Posts: 8,174
Registered: ‎09-28-2007
0

Re: Mortgage Qualifying/ pay down student loans?

Sounds like your employment/income will be OK to qualify with, yup I agree on saving the $5k.


myFICO is the consumer division of FICO. Since its introduction 20 years ago, the FICO® Score has become a global standard for measuring credit risk in the banking, mortgage, credit card, auto and retail industries. 90 of the top 100 largest U.S. financial institutions use the FICO Score to make consumer credit decisions.

>> About myFICO
FICO Score - The Score that matters
Click to Verify - This site chose VeriSign SSL for secure e-commerce and confidential communications.
Fair Isaac Corporation is a BBB Accredited Financial Service in San Rafael, CA
FOLLOW US Social Media Facebook Twitter Pinterest Google+