Conventional 95 or 97

[AlphaKenny]

Hey all,

I'm getting ready to apply for a mortgage and I'm wondering what my options are or what I need to do.

My middle mortgage score last month was 679, but that was before I paid 2 CC balances down from 90% utilization to 29% and 7.5%.  So I'm hoping it bumped it above 680 when they report in a few days.

I'm looking at the Conventional 95 or 97. I have about 21k to put down, but that includes closing costs.  Maybe seller can pay 3%??

I'm looking at houses no more than 415k so 3% downpayment is about 12.5k or 5% 21k.

Will the 5% down give me a much better rate?

From what I've been reading, these two progroms don't require any reserves as long as my FICO is greater than 680.

My income is 8k gross monthly and my minimum debt payments are $523.  Does this leave me enough DTI to cover the payments?

If I'm missing anything, please let me know!

Thank you in advance!

[DallasLoanGuy]

you will get a little better rate and the pmi is lower at 5% down as well.

that 97% product is pricey

[AlphaKenny]

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@DallasLoanGuy wrote:

you will get a little better rate and the pmi is lower at 5% down as well.

that 97% product is pricey

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Thank you, that's what I was wondering.  My biggest issue with the 5% is that leaves me with not very much for closing costs.

When I briefly spoke with a mortgage broker, he told me not to worry so much about the closing costs because they could mostly be covered by the seller if they agree, or they could be "added" to the price of the home, etc.

I am located in California and from what I have researched the closing costs can get pretty pricey here.  Also, the max the seller could cover is 3% closing costs with these two loan options.  Any ideas/thoughts?

[DallasLoanGuy]

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@AlphaKenny wrote:

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@DallasLoanGuy wrote:

you will get a little better rate and the pmi is lower at 5% down as well.

that 97% product is pricey

---

Thank you, that's what I was wondering.  My biggest issue with the 5% is that leaves me with not very much for closing costs.

When I briefly spoke with a mortgage broker, he told me not to worry so much about the closing costs because they could mostly be covered by the seller if they agree, depends on the market. some people are paying over asking price and no closing cost help in some markets or they could be "added" to the price of the home, etc. cannot be added

I am located in California and from what I have researched the closing costs can get pretty pricey here.  Also, the max the seller could cover is 3% closing costs with these two loan options.  Any ideas/thoughts?  up to 3% of the purchase price rebated back should be plenty to cover it all

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[AlphaKenny]

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@DallasLoanGuy wrote:

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@AlphaKenny wrote:

---

@DallasLoanGuy wrote:

you will get a little better rate and the pmi is lower at 5% down as well.

that 97% product is pricey

---

Thank you, that's what I was wondering.  My biggest issue with the 5% is that leaves me with not very much for closing costs.

When I briefly spoke with a mortgage broker, he told me not to worry so much about the closing costs because they could mostly be covered by the seller if they agree, depends on the market. some people are paying over asking price and no closing cost help in some markets or they could be "added" to the price of the home, etc. cannot be added

I am located in California and from what I have researched the closing costs can get pretty pricey here.  Also, the max the seller could cover is 3% closing costs with these two loan options.  Any ideas/thoughts?  up to 3% of the purchase price rebated back should be plenty to cover it all

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As far as "adding" the closing costs to the price of the home....what I mean is if the home is 415k, can I go under contract for 418k if the seller agrees to pay 3k of the closing costs?  Thats basically like financing the closing costs without affecting the sellers bottom line.  Does that work or is that what you mean by cannot be added?

[ezdriver]

You are free to negotiate whatever price and terms with the seller just as long as the property's appraised value supports the final price.