What might I qualify for?

[Anonymous]

Thanks to everyone here I've learned a lot in the past year and my credit has vastly improved to the point where I'm considering a first time home purchase. Here's my situation:

Monthly Gross Income (w/spouse): $7150 (Both W2 Salary)
My Midscore: 721 Spouse: 736 (No Negs on Either)
Student Loan Payment: $380, $42,000 Outstanding

CC Debt: $13,000 Total CC Limits $62,000
Monthly Minimums around $400/mo

Auto Loan $240/mo Outstanding $4000

Can anyone give me an idea of what I might be able to qualify for? Basically I am at the point where I've got my DTI on track for an FHA loan but am wondering if I am better off to keep hammering away at the CC debt or save for a down payment? I can keep working at the CC debt to drop my total minimum CC payments from $400 or I can just continue building for a down payment, not sure which route to go.

I have been hoping for a 3.5% down FHA loan for 250-275k (FHA max in my area is 275) but I really don't know if that is realistic or if I could qualify for a larger conventional with some work on my DTI? Any guidance would be appreciated
Thanks!

[ShanetheMortgageMan]

Your numbers look fine for FHA and the amount of loan you'd be looking for.  If you can put down 5% then conventional would be about the same monthly payment, but the PMI wouldn't be for the life of the loan.  If property taxes & homeowners insurance are less than $675/mo combined ($8,100/year) then your debt to income ratio should be fine for conventional.  A 740 score will also get you better rates & lower PMI with conventional as well (which should make the payment less than FHA with 3.5% down).

[Anonymous]

Thanks for the info Shane. The amount of assistance and wisdom you've given out on this forum is incredible.

What would it take to maybe bump up to a 300-350k conventional with 5% down? Would I need to decrease DTI as well as get up to a 740?0

[kc0039]

Looks like you need to decrease DTI to get to $300,000. I don't know what are you are in, but around where I live, taxes for a $300,000 can be as high as $12,000 per year. If you really want to buy a $300,000 house with 5% down, taxes and insurance shouldn't be higher than $510.00 per month

[Anonymous]

Thanks for the info KC. Looks like taxes would be $358/mo for a 300k property.