FHA Loan and mortgage question?
My credit score is 650, debt to income ratio is 24% and going down, and I make around $100k a year. Been with the same company for 3 1/2 years, promoted 7 months ago, and love my job. My issue here is my credit history. I'm 29 years old and it's been a rocky road because of a few bad decisions in the past. There are no repo's or bankruptcies but a bad charge off, late payments etc... The good thing is that in the past 2-3 years, I've haven't missed any payments or made any late payments. Income taxes are slowly killing me and purchasing a home will definitely help with a nice deduction. As well, I've always wanted to be a home owner. What are my chances here at getting a decent FHA loan or any loan for that matter? I'm figuring a home purchase of around $200k with $10k down...
What does taking out a second mortgage entail?
A second mortgage is known by various names - equity line, HELOC, second mortgage, second loan, junior loan. Because a second mortgage is "junior" to a first mortgage it will get paid out second if the borrower walks away. More risk means a higher rate. Whether you can get one depends on the equity in your home. This is the difference between the existing loan balance(s) and the vlaue of the home. You don't have to use the same lender as your first mortgage, in fact it's usually easier to go to your local bank. They will do an appraisal on your home, check your income (abilty to repay), and if they add up they'll give you the money. The loans combined will need to add up to (probably) a max of 80% of the value of the home.
I'm getting a mortgage from the bank to buy my first home, but I have the opportunity to use the down payment to start a pharmacy. What do you think?
Being you're a first time home buyer you may be able to do both. There are many options available to first time home buyers requiring a minimal down payment. 9 first-time homebuyer grants and programsAs far as the Pharmacy there are three things to consider when investing in a brick a mortar business, location, location and location.Is the proposed pharmacy in a busy area that will generate a high income? What is you competition is there another pharmacy close by?If the location is good and you're confident that the pharmacy will generate a good income then I personally would get the pharmacy before the house.Once the pharmacy is established you can use the income to help pay for the house and maybe even purchase larger home. Plus you can use the pharmacy as collateral when applying for the mortgage.Hope this helps.
Have a question about monthly mortgage payment...?
Okay this question is so hard to answer not knowing where you live or values. I will give some advice. First time homebuyers normally have a 3% downpayment. this will affect your MI Premium. If you are going FHA its 1.5% of mortgage insurance upfront. That is added to your loan. Then its .5% of your mortgage. So say its 100,000 loan. They add 1.5% to that loan and your montly payment would be around 42 dollars a month for mortgage insurance FHA. FHA is always the same reqardless of what you put down. Its 1.5% and .5% monthly divided for a year. Now lets say its conventional. That will change at 97,95,90,85% of your down payment. You put 3% down your rate will be one thing. You put 5% down it will be another. http://www.mgic.com/is/html/ratefinder.h... That will tell you the rate. When calculating this if you want to play your coverage will be 35%. When it asks for that. At 100K im showing 80 dollars a month. Its more expensive then FHA per month but you dont have the upfront that makes your payment cheaper. For Hazard Insurance I use .3% of the home value. So I would say 300 dollars a year. So 25 bucks a month (assume you are not in a flood zone) Taxes I use .8% So 800 a year so 66.66 a month. This is based on a $100,000 loan. If you use those figures they wont be exact but they should be close. So on my example lets say you do $100,000 loan at 5.75% rate. Here is your breakdown. 583 principal and interest 66 Taxes 82 Mortgage insurance (assuming 3% down and not FHA) 25 hazard insurance. Its basically always going to be around 25-30% more then your payment. Good luck.
First year paid mortgage?
nidia, You need to be earning two good livings before you consider buying anything never mind a house. there are companies out there who would love to loan you money cause they will get the house back. Get 'House buying for dummies' read it. Save your money work hard and smart. visit DaveRamsey.com learn what he banks don't want you to know. You don't go into a house with no money unless you like living in your car. Houses are expensive (principal interest taxes property association dues school taxes utilities electric gas water sewer yard upkeep stuff to fill the windows furniture etc.)You need REAL money .
First time home buyer financing question?
If you have a checking acct, the bank where you currently bank. Ask to speak to a loan officer. It is best to be pre-qualified before you make an offer on a house. If you pre-qualify, you fill out all the paper work for a loan and the bank will let you know how much of a loan you can get and the terms (interest, etc.). It takes 14-30 days usually to process a loan...depending on how prepared you are...you should have the last two years tax returns, a couple of months of pay stubs, and get your credit report on your own (you can get it for free). Points are the loan fees the bank charges to process the loan...some loans have zero points, so it pays to shop around. The points are not usually tax-deductible, but some of the other fees are, so check how things are itemized. You can also go to a mortgage broker...the broker will take your application and shop it around to four or five different lending establishments. The broker will get you the best deal possible and will get paid a commission based on you closing the loan. A broker can be a good way to go for a first time buyer.
Is taking out several mortgages for rental property a very big risk?
Many of my clients who purchase properties to use for Rentals will actually get a Commercial Line that they can use for those purchases. Create a corporation and that way their personal risk and liability is limited.I would suggest you first get a corporation, a business plan, a good account, and then you can get a few properties to begin with using the equity in your own primary residence as a way to obtain the first few, then use those to secure the commercial line and transfer the properties into the commercial line, and pay back the equity loan used to purchase them.Spend time and review options, and don't waste money on those traveling road shows that tell you how to do it. Find a good REALTOR who specializes in investment properties like that. If you need a recommendation let me know and I will check in my network for someone to assist you.
Can I take out a first time mortgage that is greater than the cost of the house and use the excess money to pay off other debt?
The simple answer is no. The reason for this is that the lender will make its loan based on the lower of the purchase price or appraised value. Even if you agree to pay $300,000 for a house and it appraises for $320,000, the lender is still going to base the loan on $300,000.If your other debt is keeping you from qualifying for the loan you want, you may have some options.Get a loan for a higher percentage of the property’s value and use the cash you have left over to retire debt. You can pay of the debt through escrow, as a condition of closing. If your loan amount is for more than 80% of the property’s value, you’ll likely pay mortgage insurance, but the lender will allow you to remove it once the loan balance falls below 30% of the property’s market value. (note: This applies only to conventional loans. For FHA loans, the mortgage insurance will be in place for as long as you have the loan)If your property needs some remodeling, consider a “rehab loan” such as FHA’s 203(k) program. With this, you’ll be able to get a loan based on the property’s value after you do work on it. The lender will set the money for the work aside in a separate account to pay for it.If any of the debt is secured by an asset, such as a car, motorcycle or RV, consider selling that asset to get rid of at least that loan. Maybe you don’t use those items enough to justify the expense of owning them.Make an organized plan to retire that debt over time. There are many ways to do this systematically. I think I wrote an answer about one method for doing this, but I can’t put my hand on it right now. Search on “snowball” and you should be able to find it. Paying off your debt out of income rather than simply changing it to another kind of debt (credit card debt --> mortgage debt) may take some time, and you may hvae to defer your house purchase, but it’s a worthwhile undertaking.In any case, I hope this was useful. Good luck!
Does it seem like you need to take out a mortgage to take your kids to a professional sporting event?
Leaf tickets, have only available on the resale market for years. The idea of paying $1500 CDN ( $1135USD) for a pair of similar seats that we used to be given for free. That's $3000 CDN($2270 USD) four are family of four.We live in Toronto, home of the long suffering Leafs fans. I am 56 and they last they won the Stanley Cup when I was in kindergarten. We can visit it most of the year, as it and all the NHL trophies live at the Hockey Hall of Fame downtown.Back when the Leafs still played in Maple Leaf Garden, and my wife was a executive at very old company, that had the seats since the Gardens were built in 1931We would get arguably the best seats in the house for free. First row Centre ice Reds just above the glass with no obstructions.I have never set foot in the ScotiaBank Arena, or the Air Canada Centre as it was previously known.