Soon to be A first time Buyer NEEDS HELP

[Anonymous]

Hi,

I live in southern california and  I am looking in buying a house preferably March 2022. Currently my Mortgage Fico score hoovers around 730-751 it dropped due to some unexpected expenses that i had put on credit card that is reporting but looking to pay it off by February next year. Looking in the San Fernando Valley area.
I did the preapproval from better dot com and i got a hefty amount of $300K which in my area is big enough for a garage ONLY.

Data

Credit score ( Mortgage scores 720-750) 1 late payment in feb 2018 otherwise clean report

Income is $140K

DW ($60K) score (>760) Clean file

Have about 5% on DP

Looking to see if we can qualify for anywhere between $720k-800K so we can be able to get something descent.

How can i improve my chances of getting qualified for higher amount

Is it better to go with a mortgage broker; and if so how do i connect with a reputable brokers in Socal.

Is this something realistic fo our family to achieve or should we continue with renting?

Thank you 

[Revelate]

Just some napkin math but looks like your online shopping gave you a 10% down underwrite or your DTI is skewed a lot worse than you posted.

There are some lenders that historically would do 5% down even during the pandemic (my own was through Cardinal Financial for example, closing was a disaster but that may not have been entirely their fault as the builder was a little wonky too, and they got it done at least and I can't complain at the result, it's a damned good mortgage).  

You may have to look around though as economically we're not in the same place as we were 18 months ago when I got my last mortgage; realistically to improve chances just start squirreling away as much cash and address any DTI issues as you can but with only a few months this is hard but assuming you have no other debt, well, end of the day 200k/yr = 7.16k/month in backend at 43% DTI; you can fit a lot of house in that if your financials are sorted.

[Anonymous]

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@Revelate wrote:

Just some napkin math but looks like your online shopping gave you a 10% down underwrite or your DTI is skewed a lot worse than you posted.

There are some lenders that historically would do 5% down even during the pandemic (my own was through Cardinal Financial for example, closing was a disaster but that may not have been entirely their fault as the builder was a little wonky too, and they got it done at least and I can't complain at the result, it's a damned good mortgage).  

You may have to look around though as economically we're not in the same place as we were 18 months ago when I got my last mortgage; realistically to improve chances just start squirreling away as much cash and address any DTI issues as you can but with only a few months this is hard but assuming you have no other debt, well, end of the day 200k/yr = 7.16k/month in backend at 43% DTI; you can fit a lot of house in that if your financials are sorted.

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Thanks for replying. I thought it was strange too given some people on this forum had mentioned there prequal can telly ou how much you can qualify for. I am not sure how they are calculating my DTI ratio, i do not have any student loans, I have 5 months left on my car note and in my understanding that should not really count against my DTI since its less than 10 months. My DTI ratio should be less than 20%. I will be looking and shopping around given i am looking to pull the plug next month.

[Mortgage-Specialist]

As long as your vehicle loan is not a lease,  the payment will be removed from your debt ratio. Unless you have significant student loans, the 300k approval seems to be ridiculously low.  

[VALoanMaster]

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@Anonymous wrote:

Hi,

I live in southern california and  I am looking in buying a house preferably March 2022. Currently my Mortgage Fico score hoovers around 730-751 it dropped due to some unexpected expenses that i had put on credit card that is reporting but looking to pay it off by February next year. Looking in the San Fernando Valley area.
I did the preapproval from better dot com and i got a hefty amount of $300K which in my area is big enough for a garage ONLY.

Data

Credit score ( Mortgage scores 720-750) 1 late payment in feb 2018 otherwise clean report

Income is $140K

DW ($60K) score (>760) Clean file

Have about 5% on DP

Looking to see if we can qualify for anywhere between $720k-800K so we can be able to get something descent.

How can i improve my chances of getting qualified for higher amount

Is it better to go with a mortgage broker; and if so how do i connect with a reputable brokers in Socal.

Is this something realistic fo our family to achieve or should we continue with renting?

Thank you 

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On an 800K purchase, you're looking at a total estimated mortgage payment of $4,392.41 with taxes, insurance and PMI included.

With $16,666 in monthly income that payment would give you a front end debt ratio of 26.356%. You would need to add another $3,100 in monthly debt to push your back end DTI to 45%.

With your car payment, what is your total monthly debt?

I would think twice about working with Better, the CEO laid off 900 people in a Zoom call 2 weeks ago. That could cause delays in their turn times.