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hmmm..i think we are ready for new construction mortgage, scared to be denied

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Anonymous
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hmmm..i think we are ready for new construction mortgage, scared to be denied

Hi all, just looking for advice before I try to qualify for a new construction loan.  I'm willing to do whatever it takes to make us qualify.  Just scared to find out that it's not possible anytime soon.  What do you think?  here's some info,

 

$160,000.00 - thinking this is the highest we can go

$85,000.00 - give or take, my husbands gross yearly income ( I don't work, but would like to after I get my epilepsy under control)

$950 - monthly loan payment (car, and the 2 acres that we bought)

$800 - monthly utilities (electricity, phone, tv, internet, water)

$55 - month for store credit at appliance store

 

 

His credit scores are highest at 645 and lowest at 620 (this is on myfico dashboard, of course it's different scores for different types of credit, not sure which they will use)

 

We had a chapter 7 bankruptcy that was discharged December 2009

We have 1 credit card at an appliance store with a limit of $6000.00 we only used $1000.00 last month because our big window ac unit went out.

 

so here's the few questions i have..

We bought these 2 acres from my mother in law for about half of it's worth.. Using a personal loan from our credit union, so the land is not officially financed.  We have the deed.  We only owe around $9000.00 on this personal loan (included above) we were going to try to hurry and pay that off before trying to build our house but I was wondering if it were possible to just throw it in with the new construction loan, since the land will be used as collateral anyway.  We live in a very rural area so maybe with FHA or USDA?

 

My husband has been with his current employer since 1991..  He is wanting to change jobs at a different company because it would mean more money, less stress and easier work (he's a welder and the industries are kicking off in our area)  I'm afraid that him getting a new job will have a negative affect on our application compared to a job history at the same company for all those years.

 

I"m hoping we can use our land as collateral . 

 

Any advice?

 

Message 1 of 3
2 REPLIES 2
ezdriver
Senior Contributor

Re: hmmm..i think we are ready for new construction mortgage, scared to be denied

The type of loan that you need is a construction loan that coverts into a mortgage at closing. Best places to start are your local banks and your selected builder. The underwriting criteria for these type of loans are different than a usual 1st mortgage on a home purchase.

Message 2 of 3
StartingOver10
Moderator Emerita

Re: hmmm..i think we are ready for new construction mortgage, scared to be denied

You could also check into a construction-perm loan.  That is a construction loan that automatically rolls over into a permanent mortgage at the end of the contruction period.

 

Since you are building on the land that you are currently paying for, you can roll that balance into the loan (usually).  Talk to a LO about it. 

Message 3 of 3
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