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Looking to purchase first home

Posted on: 13th May, 2012 10:51 pm
Hello,
I’m 26 years old and I am looking at buying my first home in the next few months. Me and my girlfriend live in a apartment and our lease is up August 30th. So we would like to move in around that time.

I have excellent credit, about a 770 credit score. I make $65k a year and have a $600 truck note and $3000 in credit card debt. I definitely plan on having my credit card paid off before the home purchase or at least down to less than $1000.

I really just cant figure out how much I can afford. I really want to spend around $150,000 but want a good estimate on a monthly payment. I often hear people say 1%, but with my credit I’m hoping for less. For example my sister just bought a $175k home and pays $1,400 a month with taxes and ins. So I really want to spend less then $1,200 a month total. I can afford more, but don’t want to be house poor as me and my girlfriend love to travel.

I’m looking in the Houston area BTW

Any advice/input will be appreciated!
To qualify for such a mortgage, you must have some down payment money to put into the home purchase. It used to be that you might get away with nothing down, but in today's troubled housing market, you might expect to pay even twenty percent down in order to satisfy a bank that you are fully on board with the mortgage commitment. They will usually only agree to loan you from two to three times as much money as you earn annually.

:idea:
Posted on: 14th May, 2012 01:14 am
I agree. You have great factors helping you in credit score and income but what amount of down payment do you have. For that purchase price and desired monthly payment you need $40,000+ to put down or 20%.
And congrats to the income you make at that age in our economy. BTW, I loved the Houston area with those Cuban/Mexican food place. I enjoyed Humble and that long A named city next to it Atascadero. Check your payment scenario using an online calculator
Posted on: 14th May, 2012 08:44 am
Thanks you two.

Unfortantly I don't have alot saved. Ill have about 5% to put down. I just got preapproved today. I told her I wanted to stay around $1200 a month and she said I'll have to stay under $120,000. Thats strange to me because like i said earlier. My sister pays $1400 a month for a brand new $175000 house.
Posted on: 14th May, 2012 11:39 am
That would depend on the loan type your sister received. If she did 20% down, then she would not have mortgage insurance, and also her rates will be a little less. If you chose to put down only 5% then most likely the loan agent put you into a FHA loan. 5% down of $150,000 is $7,500. So your loan amount would be $142,500, based with average of 4% interest would yield $680.32 payment. Plus mortgage insurance 1.20% of the loan amount or $142.50 a month and Taxes at 1.25% of the purchase price or $156.25 a month and insurance at .35% of the loan amount or $41.56...Total is $1,020.63...This is assuming a Single Family, owner occupied loan, at market FHA rates, with 5% down payment and 640+ fico. If you are looking into a condo, then you would have to add the HOA fees to the total payment. Good luck
Posted on: 15th May, 2012 11:38 am
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