from point of getting a mortgage

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WE HAVE PLANS TO WAIT TIL NEXT YR BEFORE PURCHASING A HOME AND HAVE FEW THINGS TO CLEAN UP ON OUR CREDIT REPORTS - BUT JUST 2 MONTHS BACK WE LOCATED THIS HOUSE WHICH IS A 5 BR 3 1/2 BATH ON 6.3 ACRES - THE GOOD THING ABOUT IT IS THAT THEY ARE ONLY ASKING FOR $210,000 - THE QUOTES WE HAVE GOT FROM OTHERS FOR HOUSES OF THE SAME SIZE ARE MORE OR LESS IN THE $320,000 RANGE - SO THIS ONE SEEMS TO BE A GOOD DEAL - WE HAVE 3 KIDS AND WANT ALL OF THEM TO HAVE THEIR OWN ROOMS - NOW FEW POINTS MENTIONING ARE THAT - I HAVE A COLLECTION ACCOUNT ON MY CR FOR NONPAYMENT OF MEDICAL BILLS - I KNOW VERY LESS ABOUT MORTGAGES & JUST KNOW A BIT FROM WHAT I HAVE READ HERE - I HAVE A BK FROM MY PREVIOUS MARRIAGE THAT IS NOW 8 YRS. - CC DEBTS ARE ABOUT $800 & ONE CAR PAYMENT $610 - HOW DO WE LOOK FROM THE POINT OF GETTING A MORTGAGE?

colin · Posted: Thu Jun 21, 2007 3:17 pm Post subject:

Hi Kim,

Welcome to Mortgagefit forum.

You are certainly a getting a good deal for that house. You will be able to get a mortgage or not or rather would be able to get the kind of mortgage which you will be able to afford or not depends on few things.

Some of the few things you need to tell us are like what is your income, how old the collection account is, your credit score, how much down payment you will be able to make, amount of reserves you have... You mentioned about the bankruptcy but its been 8 years now so it wouldn't count in your ability to get a mortgage.

If your income is good and can afford to make the required down payment then being able to qualify for a mortgage with good rates should not be a problem.

Colin

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

You need to provide some more details Kim to get better estimate of what you would be able to qualify for. You have mentioned the cc and car payment, are there other monthly debt payments? you need to calculate your debt to income ratio to see if it is within desired limits (up to 40%, it will do). Lenders give more attention to the dti you have. About the collection account, if its too old then it will not figure in too much.

Miller

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Kimhenrick, being a first time home buyer there are a lot of options open for you as far as getting a mortgage is concerned.

You will have to calculate how much mortgage payments you will be able to afford each month depending upon your level of income and other expenses and select the mortgage which will best suit your needs.

Bankruptcy has been long time back and it will not affect your getting a mortgage. But the collection account will be factored in by lenders if it is a recent one.

jenkin7 · Joined: 04 Jun 2007 Posts: 939 140.77 Dollars($)

Hello Kim,
After going through your post, I would suggest you to pay off the medical bills which would help to improve your credit score to some extent. You can get the loan for clearing the two debts. But you do need to have a good income to make the down payments.

ezmortgageloanz · Posted: Fri Jun 22, 2007 12:04 am Post subject:

Sorry---forgot to log on...

I'm going to go against the grain here as urgency and opportunity seem to be the pressing issues...

Although conventional programs are more stringent on open collections, there are FTHB (first time home buyer) programs that do allow one not to have to pay these collections as a condition of closing the loan.

Aside from this benefit, FHA loans allow FTHBs to access financing up to 97% (with the opportunity to get 100% if it is coupled with either gift funds, gifts of equity or DPA grant), a qualification that isn't based on credit scores and higher qualifying ratios allowed (also known as housing and expense ratios or front/back ratios for us in the biz) then those allowed by conventional programs (all at near prime interest rates).

There is lot that needs to be shared/understood before I am confident that you could qualify for the FHA loan---feel free to post additional details.

Regards,

Scott Miller

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Hello Scott,

What exactly are FHA loans? Could you explain this in detail. Also do I would like to know whether there are any categories in FHA loans?

Regards,

Rose

ezmortgageloanz · Posted: Fri Jun 22, 2007 12:43 am Post subject:

Rose,

My comments will be from a borrower's prospective---a FHA loan offers a borrower the following:

- Higher qualifying ratios then allowed by conventional lenders (31/43)
- Leniency towards derogatory credit.
- Non-occupied co-borrower allowed.
- Perm. resident aliens allowed.
- Lower down payment required then most conventional loan programs (1.25-2.85%)
- Seller may pay all of buyer's closing costs and preaid expenses.
- Seller allowed to contribute up to 6% (seller concessions) of the sales price.
- Funds to close maybe obtained from a family member (in the form of gift funds) or long term friend.
- Cash reserves aren't required for SFR purchases
- Up front MIP may be financed
- Borrower may finance the cost of of energy efficient improvements up to 8K without additional qualificaton.
- FHA are assumable
- DPA grants are acceptable alternative forms of down payment.
- Gifts of equity are allowed.

There are several FHA programs offered---203b (for 1-4 units), 203c (for approved condos and PUDs), 203k (rehab/renovation/new construction) and 255 (HECM reverse mortgage) to name a few.

Regards,

Scott Miller

Guest 0.10 Dollars($)

Hello Scott,

Thanks for the wonderful information!

I'm just a first-time buyer, willing to take a mortgage. Have seen friends discussing on FHA , but wasn't that much interested. But then , it seems to be a good option for people like me. Hmmmm..... need to think more on this. Should surely contact you to know about more options. Hey !! but what is HECM ???

Regards,

Rose

ezmortgageloanz · Posted: Fri Jun 22, 2007 1:46 am Post subject:

Rose,

You are welcome---Scott please don't ask members if the community to contact you..

A HECM is the Gov't answer to reverse mortgages---HECM is the FHA reverse mortgage...

Regards,

Scott Miller

Guest 0.10 Dollars($)

Hello Scott,

Thanks for the reply. I'll be slightly busy for a couple of days, but would be contacting you.

Regards,

Rose

ckalvesmaki · Posted: Fri Jun 22, 2007 5:03 am Post subject:

WE HAVE PLANS TO WAIT TIL NEXT YR BEFORE PURCHASING A HOME AND HAVE FEW THINGS TO CLEAN UP ON OUR CREDIT REPORTS - BUT JUST 2 MONTHS BACK WE LOCATED THIS HOUSE WHICH IS A 5 BR 3 1/2 BATH ON 6.3 ACRES - THE GOOD THING ABOUT IT IS THAT THEY ARE ONLY ASKING FOR $210,000 - THE QUOTES WE HAVE GOT FROM OTHERS FOR HOUSES OF THE SAME SIZE ARE MORE OR LESS IN THE $320,000 RANGE - SO THIS ONE SEEMS TO BE A GOOD DEAL - WE HAVE 3 KIDS AND WANT ALL OF THEM TO HAVE THEIR OWN ROOMS - NOW FEW POINTS MENTIONING ARE THAT - I HAVE A COLLECTION ACCOUNT ON MY CR FOR NONPAYMENT OF MEDICAL BILLS - I KNOW VERY LESS ABOUT MORTGAGES & JUST KNOW A BIT FROM WHAT I HAVE READ HERE - I HAVE A BK FROM MY PREVIOUS MARRIAGE THAT IS NOW 8 YRS. - CC DEBTS ARE ABOUT $800 & ONE CAR PAYMENT $610 - HOW DO WE LOOK FROM THE POINT OF GETTING A MORTGAGE?

Hi Kim,

There are a couple of other programs available other than FHA. There is a requirement for 3% down on an FHA loan but on the mycommunity loan there isn't a down payment requirement. The mortgage insurance rates are the same and basically the qualification is the same and the rates are essentially the same. The difference between the two loan is that there isn't an income limitation on FHA where there is on the mycommunity loan.

Guest 0.10 Dollars($)

Hello,

I'm planning to buy a house , but cannot understand whom to talk to? Some one says to see in net while others to brokers. I am confused & do not know what to do? You talked about other programs other than FHA loans, so what are they ?? Pl help me.

jenkin7 · Joined: 04 Jun 2007 Posts: 939 140.77 Dollars($)

Hello Kathy,

Other than FHA loans, there are various other programs. There are VA loans (Dept. of Veterans Affairs). Then there are fixed-rate loans, adjustable-rate mortgages (ARM), hybrid loan consisting of both fixed-rate and adjustable rate mortgages, balloon payments.

It is always better to contact the brokers directly.

ckalvesmaki · Posted: Sat Jun 23, 2007 5:45 am Post subject:

I'm planning to buy a house , but cannot understand whom to talk to? Some one says to see in net while others to brokers. I am confused & do not know what to do? You talked about other programs other than FHA loans, so what are they ?? Pl help me.

Hi Kathy,

You need to start with a mortgage broker or lender. The difference between the 2 is that in some cases a broker has more flexability to find you a loan program. There are thousands of loan prgrams available. Every one of them has different guidelines. So to try and list them is impossible. The only way is to do an application and have it reviewed by your LO or broker.

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