fha question

[Anonymous]

my income was reduced and we were pre qualified however now with the income change im scared that we wont be able to qulify.

My and my Husband both have Credit over 620, we have one car payment of 400 monthly and no other debt.

Before taxes he makes 2600 and before taxes I make around 700(part time job) I have another job however its a nanny job so I cant count that as income.

We are looking at homes under 170,000 and want to know if income wise we will be ok?

We are going FHA and rates are around 5% right now.

Any help would be great( and not the calculators because they dont give me a good enough answer.

OH and my LO said that because my hours can go up and down that as long as I have a letter stating that I was sick as a reason to my income being so low that I would be fine but I wanted to check with you guys on that.

[Anonymous]

Combined income of 3300 with a 41% dti and taking into account your car payment leaves you with 950 a month for mortgage, interest, taxes, pmi and insurance. I settle in two weeks with a mortgage of 156,000 and an interest rate of 5.125 and my inclusive payment will be 1150 or so. Without knowing your insurnace and taxes for the area, really can't get much closer than that.

[Anonymous]

Was the sickness for an extended period of time or just a couple weeks type thing.  What was you reported income on your taxes for last year.

If the paystub income shows declining income but it is just a one pay period type drop (in other words if your next pay paystub shows the full income) you should be OK with a letter of explanation.

If the income shows a decline over a longer period they will either use the lower income, they will go by the average of your last 2 years w-2's, or some combination of the above.

Alot of it alos depends on the rest of your file:

What mid FICO score are they using

What is your accounts history

How much down payment

Reserves?

Are there any compensating factors to allow higher DTI if they do use the lower income

[Anonymous]

Well my income on my last paystub was take home 500, a normal check may be anywhere from 300 and on up.

Our scores are I think around 640ish, its been two months since pulled and any alerts I get just tell me that they are going up on Equifax.

I was and am a student so I started this job in nov. My husband has all the job history and they money we have 11000 is from a workmens comp case from an injury he had about 4 years ago now.

I only have one CC

One 30day LAte and 2 sixty days that were not my fault.

my husband has a few PIF collections and has about 4 cards all in good standing , low balances etc.

I can get my income up to about 1000 a month if needed in a few weeks. we have been going through the house hunting period for about 2 months

Oh and I forgot, my husband took a part time job that is going to make us about 150 monthly just helping a bit at his old job.

[Anonymous]

They may want to average income over the last 2 years for you since you have only been ont he  job 6 months and there has been some inconsistency.  Only an underwriter will know this.  Also, the part imte job will have to be in place for quite awhile to be able to use that as income.  If it was not on last years taxes, they will not count it.  the saem thing goes for the added income from you.  They go by income history, not by your exact current income, unless you are salary and have been on the job for awhile.

When were the lates.  If any were in the last 12 months, that may be a big problem. 

Also, the 170K seems a little high for for 3300 income.  You are probably looking more like 125K considering the debts verse income.  You said there was a 400 car loan and your husband has cc accounts.  Basicly you have 1K left over for mortgage costs including:

payment

interest

MIP/PMI

Home insurance

Real estate taxes

HOA's (if applicable)

125K sounds about right (+ or - a little depending upon taxes and interest rate)

Your LO should be able to help you, and they may allow you to qualify with slightly higher DTI due to the newer income (but that is always sketchy)

Just remember that they judge you on the whole file so you want to make sure for every part of the file that is pushing limits, there are parts that are really safe...  for example, with your income being bordeline and credit of 640 only 20 points over the minimum, job history (for your husband), any reserves you have, down payment, recent credit history, and any additional proveable but unallowed income becomes very important...

[Anonymous]

what if the income was around 3700?

[Anonymous]

That would take it up to around 1100-1150 per month..  So figure another 10-15K or so purchase price (again ballpark figures off the top of my head)

But just to clarify, it is likely already too late to input more income.  your job history is short as it is and any additional jobs or such you pick up will not likely be counted.  Also, the same goes for the husbands second job.  Unless he has been working there for awhile and unless he reported income from them on last years taxes, the UW will not likely count it.  It is always possible, but not likely.  The general rule of thumb is 2 years job history in same field for qualifying income.  They make eceptions for people coming out of school to a full time position in their field of study and such of course.  My point being is that your primary income (the 500-700) is already borderline to qualify due to the short history and up and down nature of it, they will be unlikely to count any newly found income or any new jobs.  How much income did you report last year.  This will probably be a big factor in this.

Also, for 170K you would probably be looking at roughly 1400-1500 per month total payment so counted in with your car payment/CC you would still need to jump income up to roughly 4500 per month to qualify. (again, rough figures from my head)

As I said before, they can stretch guidelines, but they want to see compensating factors such as reserves, great credit, high previous rental costs/great rental history, explanation for expected income increases/etc.  The more parts of your file they have to scrutinize closely, the less likely they will make any exceptions. 

[Anonymous]

1400? without hoas right?

The job was his previous was clamied last year so it can be counted, my income was at 1600 and then 1000-600 and due to that drop I could get back some hours im sure.

I dont want to get into a payment that we cant afford.

so at 3700, it would be around 140-150000?

[Anonymous]

I qualified for 180,000 or so with 4450 in income and 670 in other debt and that was using 5.5% interest and about 225 per month in taxes/insurance. At the time it was a USDA loan and so there was no PMI.  I think the payments were about 1400 Youd have to add another 60 or 70 a month for that I think.

I ended up with a 155,000 mortgage with final payment of 1150 including 280 or so in insurance, PMI and taxes and that was at 5.125%

Message Edited by teacherhere on 04-05-2009 04:23 PM

[Anonymous]

We were preapproved twice, maybe it'll help you with figures.

$3750 with roughly $650 debt got us preapproved for $110k at 5.5%

$4100 with roughly $650 debt got us preapproved for $135k at 5.5%