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frugalQ
Posts: 484
Registered: ‎03-23-2012
2nd Mortgage and taxes
Hi All,

I have a question around taxes and new mortgage. On the tax transcript form there are two options 1)tax form transcript which is is described as a transcript of your tax returns (forms only) and 2) transcript of your account history which gives account balance. Which option do banks request when qualifying for a new mortgage?

We are set to close on our streamline refi on 10/15, and during this process, the bank only asked for option 1. We are on an installment plan, but it never came up in underwriting. It may have come up but because it doesn't really affect our DTI, they didn't question us...I don't know.

The purpose of refi is to reduce our monthly payment so we can qualify for a new home while keeping our current home. (We are not able to sell because we are underwater, but we are planning to use a guaranteed lease program to cover the cost of current mortgage for 3 years). Our hope is to rent out current home and sell in approx 3 years.

Does anyone know which transcript banks pull for a new mortgage? Is it just the forms or is it the full account transcript? We can qualify for a 2nd home even if they count the installment payments. However, if its included, it would affect the amount that we would qualify for.

We have not applied with any mortgage companies because I don't want any inquiries on our credit until after our refi is closed (don't want to have to explain anything), so I'm basically using the various online calculators to get a ballpark figure.

All thoughts are greatly appreciated.
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