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Ok guys, the time is here. I've applied for a pre-approval for a new home. I've actually applied with 2 different lenders. One being NavyFederal and the other through a local mortgage lender. Pitting one against the other to get the best terms. Here's a little background:
Looking for a home in the $500-$550k range
Putting 10% down
My income: $14,000/month
My scores: TransUnion FICORiskScoreClassic04 - 762, Experian FairIssac (VA) - 705, Equifax FACTABeacon5.0 - 700
I thought NavyFederal's terms and rates would be lower for me, but here's where them came in at so far.
30 year fixed
10% down
3.75% PLUS 1.75%(due to my score not being 720+) = 5%
Also, I would have to have 6 months of cash reserves in the bank
And if I did an ARM:
5/5 ARM
2.875% + 1.625(due to my score not being 720+) = 4.5%
ZERO down
I'mk still waiting for the other lender to let me know what they could do, but initially they told me 4% and I wouldn't have to have any cash reserves in the bank. So we'll see...
Just an update to this post.
Boy have I learned alot in this past month! Long story short, I finally got my Pre-Approval through Navy Federal for a 5/5 Conventional Jumbo ARM. This is after I got declined from KINECTA FCU and Skyline Financial(which is who I used for my first home through FHA). These other lenders basically said because of the way that I get paid (100% commission), that they can only use the average of my income from the past 24 months which would have taken me down to $10,100/month as opposed to the $14,000 I make now consistantly. Which would have taken my DTI to +50%. Also, they had a problem with my "reserves" after closing, since I was trying to go conventional, I was putting 10% down which would have wiped my my accounts. Although I had gift funds from my father-in-law of $25,000, they were only allowing me to use 3% of the purchase price.
What I did learn is that most lenders underwrite through Fanny/Freddie and even though they promised me the world, they were unable to deliver. I don't know how Navy Fed approved me with ZERO down on this ARM, but I'm glad they did.
I'm making my offer on a house we found for $500,000. Wish me luck!
Good Luck!