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Prepping for first solo mortgage!

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Established Contributor

Re: Prepping for first solo mortgage!

They will generally only use the monthly payment if it’s fixed and amortizes fully, not if it’s income based. It sounds like in this case they’d use the actual payment, which is worse than 1%, so you’d want to get that down via refi or just changing your repayment plan.

I’d suggest talking to a lender about your options before refinancing since you might want to put them on the fixed extended repayment plan to lower the payment even more (that’s 25 years vs 20).

I wouldn’t worry about one consolidation inquiry at all.
FICO8: Low 700s. FICO9: Mid 700s. Goal: 800 club
Message 11 of 14
Established Member

Re: Prepping for first solo mortgage!

One last question-

I have 4 items under installment loans - as I mentioned. 2 are my student loans and 2 are parent plus loans I took out for my kids. One of my student loans only has a $191 balance and will be paid off very soon. There’s really nothing I can do about that since I have to pay the min. Of $62/month for that loan... Nelnet told me if I really needed a few more months they could move some overage payments that counted toward that loan to the other (it was a consolidation student loan but 1/2 was secured and 1/2 was unsecured student loans so they keep them separated) so it wouldn’t be paid off as quickly... but I’m not sure if he ready for my mortgage that quickly (3-6 months) anyway.

How much will paying off one of my installment loans hurt my mortgage score? I currently have 4 but I am about to go down to 2 installment loans since 1 will be paid and closed, 1 of my student loans will still be open for a couple more years and my 2 parent plus loans will be refinanced into 1 loan. Is this going to make my mortgage score go down? Thanks!
Message 12 of 14
Established Contributor

Re: Prepping for first solo mortgage!

I’d just pay off that small one ASAP. And don’t worry about payoffs hurting. My scores didn’t have any impact when I paid off two car loans recently!
FICO8: Low 700s. FICO9: Mid 700s. Goal: 800 club
Message 13 of 14
Established Member

Re: Prepping for first solo mortgage!

Thanks for the input... you’re right- and that installment loan is getting paid off no matter what in the next 3-4 months - just based on min. payment due and how little there is left to pay and so no matter what I won’t quite be ready to buy a home then anyway... I should be celebrating paying off a loan I’ve had for 17 years!! Ha!
Message 14 of 14
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