What to do next

[Anonymous]

Any advice on next steps for me? My goal is to get this mortgage in my name.

Back ground:

My Info:

- 750 or better FICO scores on all three (although I don't have access to Experian, but it's probably my best report). EQ and TU are both ~771 on here.

- Short history. I have 4 CC's open since October (1), Nov (2), Dec (1). I am an AU on a CC with a 15 year history, and I have 2 student loans reporting. One utility reporting for 3.5 years. All positive, no lates or anything. AAoA according to myFICO 3.8 years.

- Almost 190K income from a biz that I am an employee in (W2 for about 90K) and a an owner in (K1 for about 95 K). However, 60K of it is section 127 (I think), so my AGI is closer to 140 because of accelerated depreciation.

- Land contract (contract for deed) on my current house from my dad. Built/bought in 2007 for 414K with 10 percent down (80/10/10) 80 @6.5% and 10 at ~9.6% 15-year balloon. Now owe 357K. Not sure what it's worth, but this is WI where we haven't been as affected by declines in value. My guesstimate is it's worth 360 or 370, but honestly, I have no idea. It's a really great, newer house, with lots of extras.

Wife:

- We are in WI, a marital property state. Her scores are not good since she had a BK in late 2006. She has one open medical CO for like $1900 and is a bit late on one of her student loans (although it can be rehabbed). I'm working with her on these things.

I have probably 10K that I could put into the house (more if needed) to either "buy" it or refinance it.

Is wife's situation a show stopper?

Do I have to let my tradelines age some more?

Any other words of advice?

I really don't want to miss the bus on the lower rates and if there was a way to make this happen in the next few months it would really help. Either way, I'm just looking for feedback on what to do next.

[Anonymous]

In a community property state, you can do the loan in your name, but your wife's debts would go into your DTI calculation.

You would probably qualify on your W-2 income alone, much easier than involving the K-1's, etc.

What county is the property in?

Was the land contract recorded?

I would suggest being removed as the AU on that account, as u/w look at it closely as someone else's credit "inflating" a borrowers credit score.

[Anonymous]

Thanks for the answers.

Waukesha county. I imagine your asking because of FHA loan limit. I believe it's 317K here. If I had to bring cash to the table for that I could do it in 4-5 months.

No recording of LC yet, but it could be.

Thanks for the info on the AU. It's my mom's account and I use it to help her and my elderly dad with their situation and business. Being taken off would not be good right now. HOwever, I have considered getting an Amex which they would (maybe?) back date 9 years or so for me.

[Anonymous]

I was thinking FHA, because the loan to value ratio may be tight given the numbers you laid out.

FHA loan limits in your county are $315,000 so you were very close.

You could look at doing a 95% rate and term refi to pay off the $357,000. This would require the appraisal to come in at $375,750 or so.

[Anonymous]

The appraisal is the key peice of information that I don't have. I've considered hiring a private appraiser just to know where I stand. I suppose I could also call a realtor, but I'd hate to waste their time since I'm not selling.

It sounds like to me, the best bet would be to wait until I have the $40K or so in cash to refi using an FHA-backed loan. It's a bit of a gamble since rates could go up... and who knows what the politicians will have come up with by then. Even so, I'd be in a stronger position at that point.

[Anonymous]

Rates going up..politicians messing things up (further)...and values dropping..  Those are all factors to consider.