Question

[jbee]

I was wondering how you're pre-approved for the maximum amount to buy a house.  My gross pay is around 32,000 and my only bill is car payment, 360 and cc- 80.  How much do you think I will be pre-approved for?  I want to start looking around before I contact any mortgage companies.

Also, do you know how much the TU score vary when it's pulled at the mortgage company?  My scores here are 686-Eq and 649-TU.  I'm waiting to get pre-approval because I want to get my CC paid down under 10% (they are now around 63%).  Do you think this will make much of a difference?

[jbee]

Bump...

[ShanetheMortgageMan]

Is your TU report pretty close to your EQ report?  If so, the scores should be similar.  If TU is worse than EQ, figure it'll be lower, if it's better than EQ, figure it'll be higher.  Tough to say exact since mortgage TU score will be slightly different than the myFICO.com TU score, but EQ should be pretty darn close, if not exact.  Not knowing what else is on your credit that might be hurting things, hard to say if paying the credit card down to 10% will make a huge impact... if there isn't much recent negatives, and negatives are 12-24 months old, I think you could see a decent increase (10-15 points).

With the info you laid out, assuming you would be going with FHA financing and 3.5% down, and assuming a 1.25% tax rate, and $60/mo for insurance, $100k-$120k sales price should be likely.

[jbee]

Thanks Shane.

Another question.  I'm hoping to have found a house and closed by August/September.  When do you think I should start the process of finding a mortgage company?

[ShanetheMortgageMan]

Welcome.  It's never too early to seek out your mortgage professional.  It's actually something that you should do as soon as you start getting interested, to make sure you have your situation analyzed as there could be some items that take time to work on (list is long).  That way you'll feel empowered when it gets closer to game time, and will (hopefully) have a smooth ride through the loan process.   I find the people who have bad mortgage experiences usually tend to seek out financing very shortly before they want to buy a home, and then when things don't go as they planned they get frustrated, which isn't good for anyone involved.