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Hi everyone! I've been gardening for a while, was temporarily disabled from work, and had issues with getting paid timely, so I used cash/credit cards to stay afloat until it resolved. My utilization took a hard hit, and I'm now in a position to clean it up. I have returned to work full-time (no gap in 8 year employment), I am hoping to purchase a new home in the near future vs continuing to pay rent.
I need assistance with determining the best way to pay these down/get approved for a mortgage.
I had a preapproval from NFCU a few years ago, thinking about going with them again.
I like that they do not sell loans and no PMI. I've read the negative stories, but I had a good experience, I just couldn't proceed at the time.
I have a relationship with PenFed - I am strongly considering them as well for the rates. Anyone have any experience with them?
And of course I am considering FHA since it will be my first home.
Any lenders that you all can recommend for first time homebuyers is greatly appreciated!
Wages income: $76k annually (Monthly $5,865.80) + annual bonus $2k
P/T Real estate: approx. $10k annually
*Fico 8* (as of today):
EX 713
EQ 703
TU 723
13 revolving accounts: all good standing/paid as agreed
NFCU Amex $5,096 balance / $25k limit
NFCU Go $3,894 / $24k
Chase Freedom Unlimited $4,518 / $12,500 36% utilization
Paypal $6,081 / $8k 76% utilization
Macy's Amex $7,050 / $20k 35% utilization
USAA $7,117 / $7,500 95% utilization
Citi $2,779 / $10k
Amex CM $2,501 / $10k
Amex ED $3,185 / $5,500 58% utilization
Discover $3,521 / $7400 49% utilization
Capital One QS $4,100/$11,750 37% utilization
Victoria's Secret $0 / $5k
HHFCU $0 / $2k
Credit cards: total minimum $1,268 monthly payment obligation
Personal loans:
US Alliance. $0 / $2k
NFCU NLOC $3,227.88 / $6k $65/month 53% utilization
Auto loan: $514/month; $19,418 balance
Auto insurance: $335/month. (been shopping around for better rates with no luck + claims history...ughhh)
Student loans: $45,457 (in forbearance)
Investments:
401k: I'm able to borrow $15k (I've borrowed $11k already; it's invested in real estate LLC; balance $7800; $97/monthly)
Investor: $5k (real estate)
Stocks: roughly $3800
FYI - Not sure what bearing this has but I have not gotten any returns on my real estate investments yet.
Savings: $20k
Other monthly obligations:
401k repayment: $97
Cell phone: $200 (family plan)
Life insurance $30
Action plan:
1) Pay Amex CM to $0
2) ....? Pay everything down to 30% (OR what do you all suggest??)
USAA and Macy's are on the top of my tackle list (What % do I need to bring these down to?)
I will pull MyFico mortgage scores after Amex updates. (Does it matter? Should I pull them now?)
Please share your opinions/thoughts/expertise!
If my profile doesn't appear strong enough to qualify, please share your thoughts on what I can do to improve it to get approved. Thank you!
How much house are you looking for? Your DTI is pretty high right now and you might not be able to afford what you want until you pay some debt off
@iamdetermined wrote:
I reside in NY, since covid hit home prices soared and I fear I won't even to get into a house right now. Home values are upwards of $500k. I'm giving a huge rough guesstimate here -- about $400k-$450k. If I'm "reaching," please feel free to tell me to pump my brakes lol.
I've created an action plan to lower my DTI and starting to make payments.
My mother and SO will be living with me; they will be contributing to the household expenses but neither is being added on the loan.
You are in trouble
Income: 76k/year = $6,333/month
Highest DTI allowed (FHA with no overlays and DU approval): 55%
6,333 * 0.55 = 3483
3483-1268-65-514-335-454 = $847 for PITI.
A 500k mortgage PITI is going to be much more than $847/month.
Your focus should be on paying things off to reduce your DTI.
@dragontears wrote:
@iamdetermined wrote:
I reside in NY, since covid hit home prices soared and I fear I won't even to get into a house right now. Home values are upwards of $500k. I'm giving a huge rough guesstimate here -- about $400k-$450k. If I'm "reaching," please feel free to tell me to pump my brakes lol.
I've created an action plan to lower my DTI and starting to make payments.
My mother and SO will be living with me; they will be contributing to the household expenses but neither is being added on the loan.You are in trouble
Income: 76k/year = $6,333/month
Highest DTI allowed (FHA with no overlays and DU approval): 55%
6,333 * 0.55 = 3483
3483-1268-65-514-335-454 = $847 for PITI.
A 500k mortgage PITI is going to be much more than $847/month.
Your focus should be on paying things off to reduce your DTI.
Agree - DTI is way too high for a house purchase.
OP should concentrate on finding a good mortgage broker to concentrate on improving DTI, lowering utilization, and increasing 5,4,2, scores.
We were in a similar situation almost 2 years ago.
Home prices in Southern California were skyrocketing feeling like being priced out.
Found a very patient mortgage broker who had us concentrate on certain debt (disregarded store cards, PLOC, etc) and got our scores up to the point that we can qualify for a conventional first time buyer loan.
Then during the course of a year, he had us work on eliminating the high interest cards that were eating our monies, eliminating the small balance card accounts, and consolidating our major debt into a PL with lower interest and fixed payment terms.
Year later (took over 80 houses searching) we were able to get pre-approved and into a house we closed on 2 months ago.
Best thing since we moved out of the rental - our house is now worth $30K more than when we first started escrow!