What do you guys think?

[jamie2005]

Do you guys think I have the chance of getting approval for a $ 235,000 house. I have a middle score of 721 and Smyrna wife has a middle 703. Our combined income is $65,700. We wanted to go thru usda but would  try fha since it has the low down payment as well. Only two bills are auto payments. One for $525 and another for $578. I'm willing get one refinanced in order to qualify. What are your thoughts? Should I refinance? Thanks in advance!

[jamie2005]

Forgot to mention that the property taxes would range from $1200-$1500 a year

[ezdriver]

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@jamie2005 wrote:

Do you guys think I have the chance of getting approval for a $ 235,000 house. I have a middle score of 721 and Smyrna wife has a middle 703. Our combined income is $65,700. We wanted to go thru usda but would  try fha since it has the low down payment as well. Only two bills are auto payments. One for $525 and another for $578. I'm willing get one refinanced in order to qualify. What are your thoughts? Should I refinance? Thanks in advance!

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Let's see ...

65,700/12=5,625

5,625 * .48 = 2,700

2,700-525-578=1,597

1,597/7.5=212  [I use $7.50 PITI payment for every $1k of mortgage]

Mortgage is 212,000

Price is 235,000

Down payment = 235,000-212,000 = 23,000

Do you have $23,000 to use for down payment? If yes, then you maybe can qualify to buythat $235,000 [assuming that your other mothly debt is trivial].

What do you think?

[TnTNYC]

Let's ezdriver, think you forgot the taxes.  Maybe a small amount in OP's area, but must be considered.  Nice, quick calculation, but without additional details on the other debt (assuming it is trivial) we cannot say.

Student loans?

Children to consider?

Credit card debt?

You mention refinancing your auto(s), we cannot tell if that is possible.  What are the rates and terms of the current loans?

[ezdriver]

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@TnTNYC wrote:

Let's ezdriver, think you forgot the taxes.  Maybe a small amount in OP's area, but must be considered.  Nice, quick calculation, but without additional details on the other debt (assuming it is trivial) we cannot say.

Student loans?

Children to consider?

Credit card debt?

You mention refinancing your auto(s), we cannot tell if that is possible.  What are the rates and terms of the current loans?

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My rough calculations are based on my significant experience in this area and I qualify buyers all day long for a living. My $7.50/$1k borrowed includes principal, interest, taxes and homeowners insurance and is a very conservative number. You are free to check me on that through your own lending sources. All debt is covered in the back-end dti ratio. I don't care how much debt the buyer has just as long as it does not put them past that back-end ratio. To get any more precise requires a complete analysys of details not provided by the OP.

[jamie2005]

Are you doing multiplying the backend ratio of .48 for usda or fha?

[ShanetheMortgageMan]

With the numbers you provided FHA should be doable, USDA your debt ratio would be a little too high... right under a 47% debt ratio.  The max I've seen get approved with USDA lately is 34/46% ratios.  If you can refinance the cars and knock $300/mo off their payments combined then you should be a shoe in for USDA, as then your total debt ratio would be just under 41%.  But even just $50/mo less could do the trick (which would put the debt ratio about 45%).