Graduating in May - and some other changes...new home time??

Missig · Joined: 11 Apr 2005 Posts: 3

Let me give some background - I have questions about loan shopping and what to do.

I will be graduating in May with my R.N. (already have a job offer on the table, which I have accepted.) My husband has been off work since Dec. 23 - because of surgery. He is due to go back to work by May 2. He was collecting workmen's comp. but it hurt our income quite a bit. We ended up with a 30 day on our mortgage and a couple credit cards, we also have a 2 yr.+ old BK7. Our income went from $77,000 a year, to $39,000.(it went to $39,000 becuase of the workmen's comp.) (After May it will be >$110,000.) We are trying very hard to keep this under control, but it is pretty hard right now.

I'm getting a little restless waiting for graduation and his realease date to go back to work. We are interested in a new subdivision that is going up in our area and we put our name on the waiting list. They say that they will be releasing lots in May - which might be a little too soon for us unfortunately.

We will have about $50,000 - $65,000 for a down payment from the sale of our home. My question is (we are in California (central)) with this bad credit will we be able to get a mortgage for about $285,000? Also is there anything I could do at this point to make the process quicker and smoother?

Thanks for your help.

Missig

BECCA9892003 · Joined: 20 Jan 2005 Posts: 400 Location: Altoona, PA

as of right now you are way over your debt to income ratio using the current 39k salary.And as long as you don't have to many other debts you are fine at the 77k. You will not be able to do this untill the income with you and your husband is closer to that 77k mark.Once you are then with as low as a 580 credit score you can qualify for a 100% mortgage with seller assist for closing. May is not that far off to wait.

A s far as making the process easier these are some things you can start to gather to have them ready:

2 years W2's
last 2 paystubs for you and your husband.(with a verification that he is back at work full time we can proceed with one of his checks but he at least needs to be back long enough to recieve one pay check.)
copies of social security cards and drivers license
2 months complete bank statements
copy of bankruptcy discharge and complete schdule of debts

this is a brief list to get you started and one word of advice with you knowing there is some credit troubles.....do not have your credit pulled for anything untill you are ready to proceed with this.you will need the highest score possible to get a competitive rate.

I am not licensed in your state but take full advatage of this board and start to work with a rep who is licensed in your area and they will be happy to help walk you through this.

I hope this helps some...

Missig · Joined: 11 Apr 2005 Posts: 3

Thank you becca for your reply. I clearly understand the debt to ratio right now is way too high for my $39,000 income, I can feel the crunch & it hurts, but we didn't have choice when he had to have the surgery. Did I read your first paragragh correctly where you stated that once we get closer to the $77,000 the mortgage of $285,000 is duable? So making over $110,000 a year shouldn't be problem for this mortgage? I know this is isn't for sure, but I want to know if I'm not dreaming too high for myself.

Thank you for your help.

Missig

BECCA9892003 · Joined: 20 Jan 2005 Posts: 400 Location: Altoona, PA

yes as of right now with that loan amt and useing 110k as yearly income you have a 25/25 debt ratio..most lender allow up to 50/50...we would have to also consider any other out standing debt you may have....but you should be fine with that income......

nikko3 · Joined: 20 Jan 2005 Posts: 246 Location: acton, ca

Missig-

Most lenders take a 2 year average of income to qualify. While your husband’s disability income will bring your 2 year average down, you should not a have a problem with your debt ratios. Just make sure you are making all your monthly payments ( rent, credit card, car pymt, etc) on time. You may want to have your credit pulled now, that way you can take care of any errors or derogatory items.

Missig · Joined: 11 Apr 2005 Posts: 3

Thank you for your replies, now I feel a little more comfortable looking in this price range. I wasn't really sure if I was off basis for this amount.

Thank you!

Missig