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Will I qualify?

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Will I qualify?

Hi MyFico,

 

 

I would like to start off by saying this is my first post, but I have been lurking on the website for about a year now and I must say that I love this website and all the knowledgeable contributors that are in this community. I will also do my best to post on threads that I feel I can make a reasonable contribution to. 

 

Well I am curious as to if I qualify for an FHA loan, and how much I should expect to qualify for if so. After harvesting all the information on these boards, I have come up with my own calculation but I would love if other members gave me their .02.  I recently dropped off income paperwork which is 2010 and 2011 Tax Returns, including schedule C, (I am 1099'd by my "employer"), 4 pay stubs and they ran my credit. They are supposed to get back me this Tuesday but I would just like some opinions

 

They ran my credit and the scores are as follows:

 

Experian           -718 -  Fair Isaac V2 Fico

TransUnion     - 703 - Classic 04 Fico

Equifax              - 693 - Beacon 5 Fico

 

For lurker purposes (those that are wondering what gave me my scores to guesstimate what theirs could look like), I have a few Credit accounts that report to my credit. They are as follows:

 

WF CC  Limit of $3,400 (300 and change on balance now, but at time of pull was 1300)

Macy's Card  no reported limit, no balance

Walmart (not the Discover)  Limit of 1k, no balance

WF CC No balance, closed

 

I have no other open loans or revolving debt

 

 

I did the math and I believe at the time of pull, my AAoA (average age of accounts for new lurkers) was 1 Year and 2 months

 

I am 1099'd by my "employer"  and in 2010 I deducted a lot of "business expenses: not knowing it would affect my chances (ie amount) of getting a loan, so my net income was low.

 

About 15k

 

2011 I netted 38k

 

and so far this year on track to make as much or more than 2011

 

Am I right to assume my averaged monthly income for the last two years will be used to determine what I qualify for? (which is about 2200)

 

Since I have no revolving debt (I will make sure I have none), I was told I can expect to be able to get 41% of my income towards my housing expense (2200 x .41) which gives me about 900 towards the PITI + hoa dues etc. Am I correct to think somewhere around the 120k mark as max? (I am searching around 110k mark by the way) I am 22 years old if that matters. I would love to hear some opinions or maybe even other people wondering the same thing for themselves.

 

 

 

 

 

 

 

Message 1 of 11
10 REPLIES 10
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Senior Contributor

Re: Will I qualify?

Hi - I don't think they are going to average your income for the past two years - I believe they will average your current income from the past couple of paystubs as that is what they did with me for an FHA loan.

 

I don't have the answers to your other questions - primarily how much house you will qualify for - but there are calculators out on the internet that can help you with that.

 

I would encourage you to look into USDA rural loans as I'm certain your income would qualify.

 

Hopefully someone comes along soon to help you with your other concerns.

STARTING: 11/24/10 EQ-584 EXP-648 TU04-595
CLOSED FIRST HOME 8/19/11 EQ-630 EXP-691 TU04-653
CURRENT: EQ-701 EXP-??? TU08-720
Message 2 of 11
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Established Contributor

Re: Will I qualify?

I do believe that your work expenses will be decucted from your annual income Smiley Sad The bank prefers to see the money going into your pockets... not your contract/business.



Message 3 of 11
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New Member
New Member

Re: Will I qualify?

Right, that is why I mentioned net. I already have that in mind (i deducted like 11k in expenses in 2010, so I netted 15k)

 

And then 2011 I had a much better year and I had no business expenses.

 

 

Booner72- Thanks for the reply, i guess I will know soon enough. I will update here.

Message 4 of 11
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New Member
New Member

Re: Will I qualify?

For what it is worth, or if anyone cares, we closed on March 30th

 

I qualified for 140k, paid 120k for the house with 3.5% down and seller paid 4200 in closing. Smiley Happy

 

I couldn't be happier! Thanks Myfico!

Message 5 of 11
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Frequent Contributor

Re: Will I qualify?

Congratulations!



Starting Score: TU 672 EQ 654 10/20/09
Current Score: TU 775 EQ 783 EX 799 (PLUS)
AMEX Delta Platinum $35K, NFCU Visa Signature $30K, HHonors Reserve Visa $35K, WF $13.5K, IHG Rewards Club MC $25K
Message 6 of 11
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Frequent Contributor

Re: Will I qualify?

Congratulations!!!!!  I love to hear the closing stories!!! Enjoy your new home!

CLOSED ON OUR FIRST HOME MAY 30TH!!!


Starting Score: TU 589 EQ 526 EX603
Current Score: TU 635 EQ 603 EX ??
Goal Score: 750


Take the FICO Fitness Challenge

Message 7 of 11
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Valued Member

Re: Will I qualify?

Congrats

Message 8 of 11
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Established Contributor

Re: Will I qualify?


@mvc wrote:

For what it is worth, or if anyone cares, we closed on March 30th

 

I qualified for 140k, paid 120k for the house with 3.5% down and seller paid 4200 in closing. Smiley Happy

 

I couldn't be happier! Thanks Myfico!


I care Smiley Happy

 

Stories like these help DW and I stay motivated to pay down debts and keep on track for home ownership in 2013!!!

 

Congrats!



Message 9 of 11
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Frequent Contributor

Re: Will I qualify?

Congrats on your new purchased!! 

Message 10 of 11
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