mortgage question

Guest 0.10 Dollars($)

Right now we are in the market to get our first house and trying to gain some knowledge about mortgages. We have a few questions. I had a talk with some you had made purchase and all have given different opinions. So I am asking all of you to get an estimate of what would suit us best. Income is at 105k, score 718 and 680 (me and wife), $630 payment for car loan (36 months left). I pay all the cc bils in full and never carried balance on any of them in the last 4 yrs. We are aiming a 220k range house and can make a 35k down payment on it. Will a 80-10-10 mortgage be our option to choose? If we take if will it be possible to refinance the 80% loan and keep the other one with the lender? Is there any time limit before we can refinance, we prefer to do it soon. Will getting a pre-approval from bank have more value than from a broker? What I want is to shop with 3 lenders and 1 broker. As we know the location and have nearly narrowed down the house that we plan to buy, I am going to use a discount realtor who will cash back portion of his earned commission, will it be a good idea? Thanks for reading my long post. :)Is 80-10-10 a good option for someone willing to refinance in future?

miller_st · Joined: 17 Jan 2007 Posts: 917 168.82 Dollars($)

Kline there are loan programs other than 80-10 ones for which you can qualify based on the details in your post. Inquire about them first before going with a 80-10. Credit score are also good with low debt burden. Your dti will be good if there no other debts from the one you mentioned.

Miller

blue · Posted: Wed Jun 27, 2007 4:43 pm Post subject:

Hi Kline,

Welcome to Mortgagefit discussion board.

With 105k income house in the 220k range is very much a possibility. You can document your income? If you can then conforming loans will be easy to get.

You have 35k for down payment & for a 20% down you would need nearly another 10k. Can you somehow arrange for that? If you cannot then many lender would also do a 90+ pmi. And PMI this year is tax deductible, can't say what it will be like for the coming years as decision has not yet been made on it.

Another thing I would tell is that fha loans have just 3% down required but there are loan limits as per area you live in. You need to check on that. Also there is Fannie Mae's MyCommunityMortgage with 0 down required. See if you are able to get any of them.

In a 80-10 with 10% down rates could be higher on the second loan for the 10% portion which is why I'd prefer you to look at other options before opting for them.

Thanks
Blue

Guest 0.10 Dollars($)

Niicss · Joined: 03 Oct 2005 Posts: 1047 156.17 Dollars($)

Guest 0.10 Dollars($)

>>>Is there any time limit before we can refinance, we prefer to do it soon.

some loans do have prepayment penalties (3-5 yrs.). when you get the loan check the papers to see if yours has such clause.

larry · Joined: 27 Jun 2007 Posts: 3328 473.40 Dollars($)

Hi Kline_Pruett,

When you can make 35% down payment, why will you go for 80-10-10 loan which require 10% down payment? You should better go for a single loan. But if you still like to go for 80-10-10 loan, you can possibly refinance the 80% loan and keep the other part intact. But better pay the loan for a year and then think of refinance.

Consult with your lender to know of the time limit before refinance and also try to get an idea of the current market rates of the loan that can be offered to you.

Caron

Hi Kline,

Welcome to our forums.

First of all, let me congratulate you on your decision to buy a home. I appreciate that you are eager to learn amount mortgages. In fact, that really helps a first time buyer who's seeking a loan in order to buy the home of his dreams.

You have an impressive credit score and that's what is going to give you an extra edge over others. Even your wife's score is also good enough. And, what is more appreciable is that, you've paid all your credit card debts in time. This is something which many people complain about – I hear them speaking a lot about problems they have gone through while repaying cc debts.

If you can make a down payment worth 35% of the home purchase price, I think that a pretty good amount and that's going to help you in securing better rates. So, leave out the 80-10-10 option – that's done when you cannot afford to make a large down payment. What I shall suggest is that you need to shop around for the options available in the market. You can approach banks, brokers as well other lenders. There are pros and cons to every option that comes across your way. Please feel free to discuss it with the community here.

good luck Smile

sara · Posted: Thu Jun 28, 2007 5:45 am Post subject: RE: home buying issues

Hi Kline Pruett,

The idea of dealing with a discount realtor seems to be a good one as it will help you get cash back. As far as approaching a bank/banker or a broker is concerned, well, that's going to depend on a lot of factors.

A bank will ask its loan officer to originate your loan whereas the broker will take you to various lenders and you will get the chance to select from a wide variety of loan options. But in case of a bank, the choices are limited.

On the other hand, a banker is a person who'll originate loans offered by banking companies and these loans aren't sold off as the ones provided by banks are sold. You need to find out what the banks and the broker are offering you. Then make some calculations and compare the fees and rates on the loans to choose the most suitable option for you.

You may go through a previous discussion to find out whether it is best to get a loan with a banker or broker.

Take Care

Guest 0.10 Dollars($)

Larry -> When you can make 35% down payment, why will you go for 80-10-10 loan which require 10% down payment?

Larry I think you got Kline wrong here. It was actually mentioned as 35k.

Guest 0.10 Dollars($)

ya it is 35k.Just missed out as i was in a hurry.

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