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Will we qualify for a loan?

My husband and I would like to buy a home.  We are currently renting.  We currently have about $45k in credit card debt, we owe about $5k on our car, and we have $110k in student loans.  We have always made every payment on time.  Our annual income is approximately $170k.  We want to know if we should spend another year or so paying off our debt, or if we should try to get pre-approved for a loan.  We are looking for approximately $300k.  Anyone have any thoughts?  All help would be appreciated.
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October 06 2013 - Chicago
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Answers (19)

Best course of action is to call a few lenders. Do you need some names and numbers?
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December 06 2013
If you haven't talked to a lender yet let me give you some suggestions for when you do - 

1)  Bring in verification of your income - with that much debt it will be important to know how much of your income your lender is able to count.  If both of you are paid via W2s each year it's easier, but all applicable documentation will be very helpful

2)  Bring in verification of your actual payments on the student loan debt - if your lender cannot show exactly what you pay he will have to assume a payment that is probably a lot higher than you actually pay.  This can really skew your ratios and impact your loan approval.

3)  Bring in verification of your down payment funds - it will be important to know exactly how much of a loan you'll need.

I've definitely worked with customers with more debts and less income, so assuming your credit is decent you may be able to get qualified based on the info you gave us above.  Spending time paying off debt is always a good idea, but talking to the lender and finding out where you stand now and potentially in the future is a great thing as well. 

Hope this helps, happy hunting!
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December 06 2013
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45K in credit card debt?  110k in student loans?  Holy smokes.  On the plus side, your income is high.  I would spend the next year or two or three paying off all of that debt and saving for a down payment.  This is not the time to start taking on more debt.  Sure you might be able to get approved for a mortgage, but seriously?  My suggestion would be to take a look at Dave Ramsey and start thinking about how you want to live your life.  
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December 06 2013

Hello:


I should be able to help you. We work with scores as low as 580; and we do have programs that allow for non-occupying co-borrowers if debt to income ratios are a little too high..  

SMC works with over 30 lenders to help you get the best possible financing.  We specialize in FHA, VA, 203k renovation loans and Reverse Mortgages for refinance and purchase too!  Were other banks require a 640 and above score to help with financing, our lenders will go as low as a 580 score on an FHA mortgage.  SMC carries an A+ Better Business Bureau Rating and we have worked in the community for over 15 years!

Please give me a call or send me an email so I can get a little more information from you. 

Best regards,

Patty Harrison
Smart Mortgage Centers

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December 05 2013
Reach out to a mortgage lender. Only they can answer this.
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December 03 2013
As a general rule of thumb, you don't want your total monthly expenses (credit card payment, auto payment, mortgage payment) to go over 45% of your total household gross monthly income.  If you are below this you should have some options.  I definitely suggest that you talk to a good lender to have them review.
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December 02 2013
Hello Belinda99

The best thing you should do is to speak to a Mortgage broker or your bank   . They will run your  credit and  tell you and your husband the best option you have to buy a home . [Content removed by Zillow Moderator. Please see our Good Neighbor Policy]
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November 29 2013
Belinda,

You really need to speak with a good lender. He/she will look at your total situation and all of your assets and be able to tell you how much you can qualify for and give you a few loan scenarios as to what monthly payments will be. I find this is the most important factor to buyers these days. 

Since your Husband has a better credit score, he may be able to qualify for a loan by himself. Since your combined income is so high, I think this may be your best bet. You may also want to consider borrowing against your 401k to come up with more of a down payment. Again, a lender will better be able to advise you based on all things considered. 

Now is the time to buy while interest rates are at record lows and home prices are still relatively low. 
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October 11 2013
Are you concerned you may not qualify with your current debt?  Or is it that you feel more comfortable with the new mortgage payment if your bills are lower?  If you would like to buy now, later or want to discuss please contact me via my profile.
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October 08 2013
Good Afternoon - The first thing you will need to do is get pre-approved.  At that point you can see what you are eligible for, and if you want to proceed with looking for a place.  [self promotion deleted by Zillow  moderator. Please see our Good Neighbor Policy for posting guidelines]
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October 08 2013
in additon to the down payment  funds - you will need several months of payments in bank as reserves as well

the 3.5% down payment required is tied to the FHA loan option  ( this options has  very high monthly mortgage insurance ....if you can muster up 5% down to go with conventional loan - mortgage insurance will be much lower

depending on how low your 600 scores  are - the FHA  option might be better due to the rate posibly being lower

get pre approved  to  know for certain ...should be able to do this  with assumption that you will have ample funds in place
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October 06 2013
You will need a minimum of 3.5% for a down payment. On a 300K purchase, that would be 10,500. You make too much money to get the Illinois down payment assistance, so you'll need to save more -or- get a gift from family members for the remainder. Also, factor in approx 3K for closing costs, unless a seller is willing to give you a credit. Again, best bet is to get with a lender to work on your plan.
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October 06 2013
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We have about $8k for a down payment.  Credit is in the 600's for me and 700's for him
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October 06 2013
Credit score ? Down payment funds ?
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October 06 2013
Monthly payments on the debt are used to qualify, not the balances. You should have your credit report run by a lender and get an overall opinion as to whether you can afford to buy now or wait. Also, you didn't mention if you have a down payment.
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October 06 2013
My web site has some lender references. Give them a call
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October 06 2013
The only way to tell is to call a lender up and see if you qualify.
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October 06 2013
Go to my web site and look up Sylvia loan officer. It looks good unless there is more to the story.
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October 06 2013
I can put you in touch with a great mortgage person. He would be able to assist you in finding out your purchasing power. Feel free to call it email me.
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October 06 2013
 
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