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MS61
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Hi,
I and my ex have an LLC that maintains and rents some rental property. We are cosignors on the mortgage for that rental property, but it is owned outright by our LLC. I have never purchased a home and should be technically eligible for an FHA loan. However, I am concerned that a lender will consider my co-signor status and will challenge whether my income is adequate on the basis that I should not be eligible in light of both mortgages at once. The LLC is currently self-sustaining,but it has shown a small loss over the years (rents were not sufficient to cover mortgage, repairs, and taxes, but now they are). |
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gmakerley
Community Mentor
Joined: 09 Nov 2007
Posts: 12376
Location: bloomfield, ct
58.49 Dollars($)
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your concern is well-placed as regards how your income will be adequate. standards are quite tight and your rental income will be viewed in that vein; perhaps causing a real problem with your qualifying. you may be able to persuade an underwriter with the use of current leases, but be prepared for difficulty.
_________________
George M. Akerley
Mortgage Underwriter/Consultant
Word of Excellence- Writing/Editing/Proofreading
860-221-5044
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ed needs help
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Post subject: FHA Loan |
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| I work in commission sales, I've been told my adjusted gross income and not my w-2 will be used to determine if i qualify. Since i wrote off a bunchof deductions, my adjusted gross income is very low. If I use my mother as a co-signer, how hard and how much money would it take to remove her if my income is in line next year. My credit middle score is 631. |
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gmakerley
Community Mentor
Joined: 09 Nov 2007
Posts: 12376
Location: bloomfield, ct
58.49 Dollars($)
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i have to assume you're talking about an fha loan, ed. that's the only way you're going to be able to use a non-occupant coborrower. as for "how hard" - that's going to be dependent upon your earnings in the future and how it averages out with this year and past years, plus your credit situation (which would be evalulated again), etc. how much money? hard to say - you'd be going through a refinance process to do it, so you'd need to be prepared for closing costs.
i have a feeling it might take a couple of years or more to accomplish that, honestly.
_________________
George M. Akerley
Mortgage Underwriter/Consultant
Word of Excellence- Writing/Editing/Proofreading
860-221-5044
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ed needs help
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Post subject: FHA Loan |
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| Yes Mr. Akerley, an FHA loan. Would I still qualify for the $8,0000 tax credit using a co-signer parent if i qualify otherwise (ie. no home ownership ever for me)? I actually think it wouldn't take that long to qualify for a FHA loan on my on. I have no debt other than a $160.00 month student loan that I'm 6 months ahead on currently and intend to stay that way. My credit score will only go up. If i took only standard tax deductions for this current year and 2010, i would have plenty of income to qualify for an $85000 mortgage with $30,000 to $40,000 of annual income don't you think, especially by the time I file my taxes in early 2011? 16-17 months? Thanks for your help sir. |
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ed needs help
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Post subject: FHA Loan |
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| One more thing Mr. Akerley please, what about using the builder preferred lender and attorney when he pays all closing costs if you do use them? Even if they are very credible bank/lending institutions and attorneys? What pitfalls should I be on the look? Thanks again sir. |
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gmakerley
Community Mentor
Joined: 09 Nov 2007
Posts: 12376
Location: bloomfield, ct
58.49 Dollars($)
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that the builder has suggested a lender and attorney is not at all surprising. what you need to do is to justify for yourself if you are comfortable with either or both of these people. if you are, then you ought not to run into any particular difficulty.
a lender is recommended by someone like a builder because that builder knows, from experience i imagine, that the particular lender will provide timely and efficient service. ostensibly, the two have a track record together and that usually eliminates some difficulties. still, you need to develop your own comfort level.
as for attorney, interview that person, and determine the fee schedule you're facing to see if that's acceptable. also, i'd suggest you interview a couple of others - just for your own sake.
no matter what, you need to be certain that the attorney you choose is YOUR advocate in the transaction...and that's not to say that you'll end up with anyone doing anything wrong. again, it's a comfort level you need to develop, in my opinion.
_________________
George M. Akerley
Mortgage Underwriter/Consultant
Word of Excellence- Writing/Editing/Proofreading
860-221-5044
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RD2009
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Post subject: FHA with cosigner |
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The rundown is my wife and I are trying to own a home for the first time while prices and interest rates are low. We are looking in a reasonable range of max $150k, as we live in Arizona home prices have dropped 50% or more in most areas.
We both work fulltime and bring in a little over $5,000 per month. I used to have a credit score of 710 at one point and now my middle score sits at 574 due to being squeezed by credit card companies. Debt ratio is terrible since they lower my limit every time I pay off a certain amount, and a couple accounts needed to get closed or the interest rate was getting hiked to 20 plus percent. Thanks again to all those folks with the liar loans and fraudulent behavior. Mortgage consultant could not believe my score was that low since there was no big negative marks against me.
If we have my father in law cosign with my wife on an fha loan since she qualifies, he would have no stake in being on the title to the house correct? My wife and I will be on that title alone right? Also, how is it that debt from only my credit will be calculated into her owings, but my income will not? If its community property then I'm not sure I understand that. |
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Ryelay
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Post subject: Co-signer Question |
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| My fiance and I are in the process of buying our first home. My fiance was approved for an FHA loan with his mother as a co-signer. Now that we are within a week of our closing date, his mom says that she doesn't want to be a co-signer anymore?! Is she at all obligated to follow through with her co-signer responsibilities? I don't know what to do. Help! |
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AG
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Post subject: Credit Score for FHA / Tax Credit |
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| I heard that there are still a few lenders that will take a 580 credit score. If that correct? Is the $8,000 credit only given with FHA loans? |
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gmakerley
Community Mentor
Joined: 09 Nov 2007
Posts: 12376
Location: bloomfield, ct
58.49 Dollars($)
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ag the credit you are speaking of is a tax credit provided through the internal revenue service (IRS). no matter who does the financing, whether it be a conventional loan, an fha loan, a sub-prime loan, a private loan, and so on and so on, makes no difference. if you qualify as a first time homebuyer, you'll get the credit of 10% of your purchase price or $8000, whichever is less, when you file your federal tax return - as long as you complete form 5405 and attach it.
as for credit scores of 580 or so...i've heard the same thing as you - that there are lenders who will work with you if your score is that low. who those lenders are i cannot say with assurance. there are some who contribute to this site, however, so you may find one responding to your post.
_________________
George M. Akerley
Mortgage Underwriter/Consultant
Word of Excellence- Writing/Editing/Proofreading
860-221-5044
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Justin a
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Post subject: $8000 credit |
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| My wife and I currently own a condo and looking to build a home together. When we got the condo I was the only one with good credit so I was the only one on the loan but both of us are on the deed. If we purchase this new house together does she qualify for the $8,000 credit since this is her first house financing |
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SD
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| how hard is it to take out the co borrower later on? In terms of costs? |
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Theo Faulhaber
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Post subject: CREDIT SCORE REQUIREMENT AND NON-OCCUPANR CO-BORROWER |
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| It's unbelievable that I still read this on these posts.FHA doesn't require a minimum credit score of 620. Credit score requirements differ from lender to lender. My FHA minimum credit score requirement is 550 and there are several other companies with sub 620 as well. Regarding a non occupying co-borrower, if it will make your long stronger (more income, lower debt to income) then add him/her to the loan. If you have any further questions, email me @ tfaulhaber@lendamerica.com. |
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gmakerley
Community Mentor
Joined: 09 Nov 2007
Posts: 12376
Location: bloomfield, ct
58.49 Dollars($)
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theo you're going to have to suspend your disbelief. keep reading and you'll see lots more that will blow your mind, and not just on this particular topic.
_________________
George M. Akerley
Mortgage Underwriter/Consultant
Word of Excellence- Writing/Editing/Proofreading
860-221-5044
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