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Need advise from you guys.
Currently own a home worth about $300k - paid off / no mortgage. We are looking to upgrade to a home that will likely cost around $430k. We earn about $90k pa and the only debt we have is a $425 pm payment on a car. We probably have about $40k liquid cash to use as well. Credit rating should be very good / excellent.
Can I get some type of mortgage that will cover the purchase of this new house before it's cashed in? Are there other routes to take that are worth considering? Thanks in advance!
Seems like you should apply for a 95% LTV Conventional as long as your DTI under 50%. An FHA 96.5% LTV would be your fall back program if your ratios were stretched beyond the 50% DTI. Then once your home sells, you can do a principle balance reduction and request the PMI be removed. Or if you had to finance using an FHA you could do a refinance. But either way, you certainly have several options.
@homeloanexpert wrote:Seems like you should apply for a 95% LTV Conventional as long as your DTI under 50%. An FHA 96.5% LTV would be your fall back program if your ratios were stretched beyond the 50% DTI. Then once your home sells, you can do a principle balance reduction and request the PMI be removed. Or if you had to finance using an FHA you could do a refinance. But either way, you certainly have several options.
If you do the conventional loan/principle reduction route, you would also want to ask the lender to recast your loan. This will reduce any payments and interest owed. You will need to make sure your loan is eligible for recasting before you close. More info: https://www.investopedia.com/terms/m/mortgagerecast.asp