Thank you for your question.
Based on the information supplied, technically your upper limit is $1.5mm with 15% down payment. This is made possible by securing your first mortgage to $1mm and having the seller carry a second mortgage at $275k. That written, it's likely that many sellers in that range may not be able to carry up to $275k; as such, alternative borrowing channels may be considered, like margin lending perhaps. Then there's possible family consideration as either investor or otherwise. And if not any of the aforementioned, a $1.25mm purchase is likely more plausible with a $250k down payment.
There are certainly a number of factors that go into recommending any mortgage loan solution, and careful consideration should be given to your overall financial goals and risk profile beyond just the acute mortgagen itself. Any reputable lender will guide you in this manner, and it would be my pleasure to discuss your situation in greater detail to understand your goals, make recommendations and define path forward on a solution that is right for your family.
What you need is a Team working for you to take you from start to finish and Beyond! Find a good Realtor, working By Referral is a good way to go, I do most of my business that way! Have the Realtor hook you up with a good Lender who can go through your paperwork as there are so many criterias and Terms to every different kind of Loan/s, and get your Pre-Approval for a Loan done. That will give you an upper Dollar limit, comfortable in payments, as to how high you can/should or want to go. Your incomes are good, trust your credit scores are good too, and you meet the 2,2,2 rule of 2 years of employment, 2 years of credit history and 2 years of residency......Mortgage details and infornmation is best coming from a good Lender. I can refer you to a good Lender, if you need one. Your loan amount, rate and down payment amount will determine your purchase capacity.
Your Realtor should also sit down with you and have a detailed conversation to find out what the personal needs are for you and your family, then proceed to show and find you a home appropriate to your needs within your budget.
Home buying is a step by step process, that should be done thoroughly and with understanding and guidance by your chosen Realtor. The areas you have picked are all safe, great neighborhoods, homes, schools and access to freeways and all amenities.......I have worked in all these areas.
I am also on the Re-location referral list for Coldwell Banker, and have helped many folks into homes...
Please feel free to contact me if I can be of further assistance. Please do check out my website and testimonials...........All the Best.
Be well and safe, regards,
It appears that you would qualify for around the 1.2-1.3 range. However, I suggest that you speak with Greg Vanslow a mortgage profesional with Princeton Capital. He has an office the Los Altos Coldwell Banker office (my office).
As far as Los Altos home values, I recently wrote a blog post detailing the first quarter sales numbers in Los Altos. The link is http://siliconvalleyrealestateinfo.com/news-flash-aliens-inv
Should you wish to search homes either by price or map, you can also do that on my blog. The link is http://siliconvalleyrealestateinfo.com/home-search/
Follow me at http://twitter.com/losaltoshomes
Your first step should be talking to a couple of reliable lenders; banks or mortgage brokers. Referrals from friends you trust are excellent resources. Your qualification for a loan will much depends on, other than your credit rating, a lender's requirement of certain debt-to-income ratio, available loan terms and the amount of cash available for purchase.
Interest rates and terms vary with the many loan programs available. A formal loan application would start the process of pre-approving you as a borrower for the maximum loan and purchase price, taking your available down payment into consideration.
A loan preapproval will not only help you determine the purchase price you can afford, but it will help you with the offer presentation as well when you found the home you want to buy, greatly improving your negotiating power.
Please feel free to contact me if you have any further questions. Whether you need help with finding a lender, understanding the local real estate market, or searching for properties when you're ready, I'd be happy to hear from you.
You and your wife have great incomes, however, what is going to determine your upper limit will be your down payment. Anything in the jumbo loan category will require a minimum 20% down payment. If you are willing to put down $250K, your upper limit will be restrcted to $1,250,000 regardless of income.
Considering Property taxes, Mortgage (principal & interest), and Insurace you are looking at approximately $7500 - $8000 a month.
This is an estimate, and I would suggest you work with a Lender that can shop the best loan for you since most banks or brokers will not have the flexibility in their portfolios to give you the best loan product available. I would suggest Vance Riddle with Princeton Capital. Princeton Capital is the largest direct lender in Northern California and will be able to assit you with your financing.
Vance Riddle with Princeton Capital
If you are interested in looking at homes in the Los Altos & Palo Alto area feel free to search my website:
the best thing for you to do first is to talk to a really good mortgage broker. That person can give you several scenarios (amount of down payment, different interest rates, length of mortgage, etc.) and the mortgage amount that will be approved. Then you can choose the plan you feel the most comfortable with and that fits your lifestyle. Only after that do you know the price range in which to look. Looking before that can create problems because you might have seen something you like, but it is actually out of your price range. Scaling down the price range is always harder to do than moving up the price range.
From what I understand, the down payment on jumbo loans are in the neighborhood of 25% to 30%. So that might give you some idea on where you stand. But a mortgage broker is the correct person to talk to.
If you are interested in a very resourceful mortgage broker call Connie Chronis at Diversified Capital Funding in Los Altos, cell phone 650.823.3851. I have been working with her for some time and she has never disappointed my clients or me.
good luck to you and happy house hunting.
Cashin Company Realtors
496 First Street, Suite 100
Los Altos, CA 94022
Lenders will typically say you need to be under a 45% Debt to income ratio, which includes all debt payments (car, boat, credit cards etc.).
To calculate that out: Lets say your combined income is $275k/yr or 22,916/mth.
45% = $10312/mth payment.
Jumbo 30 yr. fixed rates are close to 8.5%
Based on this type of loan you would qualify for a home in th $1.5 Million range (Assuming 250k down)
Talk to your lender about down payment requirements.
Jumbo 10yr. interest only you can get around 6.5% and qualify for more home.
Just to give you an idea!
I would talk to a Mortgage Broker, preferrably Scott Hill, he amazes me when it comes to new and available programs.
His # is: 408-391-4440
If you have any questions about homes or the market in general in this area I'd be happy to answer them for you as well.
In order to determine how much home you can afford, you will need to speak with a qualified mortgage broker or with your bank or credit union.
But here is a quick summary: many buyers are using FHA loan programs to obtain funds for a purchase. At present, the FHA "high balance" loans are capped at $625K, which means that with a $250K down payment, the maximum purchase price afforded you would be $875K. There is some movement toward increasing the cap to $725K in the next few months, which should help those who want to purchase slightly more expensive homes, but at present that higher figure is not yet available.
If you have excellent credit, high 700-800+FICO scores, there is "portfolio" money available for the purchase of homes over $1 million. A mortgage broker will be able to tell you the lender's specific requirements in order to qualify for higher balance loans not guaranteed by the FHA or a combination of loans to cover great balances. Although loans are definitely more scarce than in the past, there is certainly money available for those who qualify and wish to purchase a home even in Los Altos.
If you should need any assistance in finding loan brokers with excellent experience in the California market, please let me know. If you have any questions about Los Altos area homes, feel free to contact me at the address below, and I can forward to you a list of available homes that meets your criteria and for which you might be interested.
Good luck and happy house hunting!
Grace Morioka, SRES, e-Pro
Area Pro Realty
Tel (408) 426-1616