Home Buying in San Gabriel>Question Details

George, Home Buyer in Los Angeles, CA

8K credit..

Asked by George, Los Angeles, CA Sat Feb 21, 2009

My sister bought a home last year and due to DTI she needed me to go on the loan. I do not make any of the payments and can show proof. However, if I buy a home with my g/f this year will I still qualify? My g/f has never purchased a property before. If I do not qualify, can she claim it on her taxes even though the house/loan will be in both our names?

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Ruby E. Reynoso’s answer
Hello George, I would like to answer your questions about qualifying to buy a home and offer some insight to your tax questions.

First, to qualify for purchasing a home a current FICO score will be needed for both you and your girlfriend. The Federal Housing Administration (FHA) has helped buyers to purchase homes with a middle FICO credit score as low as 580. Also, job stability will be needed. Generally, 2 years at the same job will sufice.

Second, combined both of your and your girlfriends debt to income (DTI) ratios will need to be determined to see how much of a loan you will qualify for. Generally speaking, your existing credit debt payments and the payment of the new loan should not be more than 50% of your total monthly income.

Even though you are on your sister's loan you may still qualify. A current credit report can help you figure your reported debt and minimum payments.

Existing credit debt payments include credit card minimum payments, financed car minimum payments, current mortgages (which in your case should show up in your credit report because you are a cosigner on your sisters loan).

To omit the payment on your credit report for your sisters property. You will need to show proof that only your sister has made the payments for the past 12 months.

Finally, the down payment amount that you would need will depend on which type of home loan program that you use. The Federal Housing Administration (FHA) has allowed for buyers to bring in as low as 3.5% down payment.

There is a recent tax credit of up to $8,000 for a first time home buyer who purchases a home (that is anyone who has not owned a house in the last three years). visit our website at http://www.integralhomesandloans.com click on "Current News Articles" and scroll to the bottom and click on First-Time Home Buyer Tax Credit. There is a lot of good information about qualifying for the 8,000 dollar tax credit.


If you you have any additional questions feel free to contact us at anytime.

Ruby 909-815-8224 or John 951-966-8481
2 votes Thank Flag Link Sat Feb 21, 2009
Hi George, this chart provides the original tax credit highlights and how they are changed by HR1-American Recovery and Reinvestment Act of 2009:

http://docs.Steven-Anthony.com/HR1-FTHB-TaxCredit.pdf

Your specific situation is not covered in the chart; however, if they are requiring that spouses have not been a homeowner within 3 years, I'm betting they would apply the same test to unmarried individuals. Worth checking into though..

Best, Steve
1 vote Thank Flag Link Sat Feb 21, 2009
Yes you can still qualify for a home loan by yourself or with your g/f. Proof of who is paying your sister loan will be needed.

Yes, you can both claim your portion of the deductions on the new purchase / loan or just one of you can claim all of it.

The purchase credit would be available for your g/f. The purchase credit would also be available to you if you haven't claimed any deductions from your sister's home. Because you two are not married only half of the 8k would apply....unless it was changed recently.

More info. or questions...? Let me know and good luck to you.

P.S - Find out how to reduce your mortgage payment by 15% minimum if your buying in Los Angeles.
0 votes Thank Flag Link Sat Feb 21, 2009
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