The program gets its funding in the fall, and the money runs out soon after the New Year, so the timing of your application is critical. At the moment the program is closed until further notice - meaning that they are not taking applications until the next round of funding occurs.
In order to apply for the program, your lender must be accredited by the City of Vista, so you should start by contacting some of the lenders on the City's approved list, which oyu should be able to find on their web site.
There is also a Federal program called the Mortgage Credit Certificate. This program allows low to moderate income, first time home buyers to take a 15% federal income tax credit for the annual interest paid on the mortgage use to buy their home. This credit reduces the federal income taxes of the buyer, resulting in an increase in the buyer's net earnings, as well as an ability to qualify for the mortgage loan. The home buyer must occupy the home as a principal residence, and cannot have owned a home in the last three years.
You can find more info on this program at http://www.ahahousing.com/pages/firstbuy.htm.
Whatever you choose to do with respect to a down payment, you should budget your monthly payments very carefully. Even though a lender may qualify you for a certain loan amount, this does not automatically mean you should borrow that much. If you stretch yourself to the limit on your mortgage, you put yourself under enormous stress should anything happen to reduce your income. Bear this in mind and budget carefully.
a) What you can afford per the BANK is different than what you can afford per your personal financial goals... So that would be a conversation to have with a lender. Not only what you are qualified for, but what you want to pay from a personal finance standpoint.
From the BANK point of view, the amount you can buy is dependent on what is called your "debt to income ratio". That is, the max percentage that your house payment in addition to monthly car payments, credit cards, etc, makes up of your total gross income.
So, it depends on a number of things. A) what is the max debt to income ratio for the program you are looking for? Conventional is between 45 and 50% maximum DTT; FHA is about 55%, and VA is more like 60 to 65% maximum.
B) Do you have enough down payment to avoid mortgage insurance? Does your home have HOA's? That will affect your purchase "bandwidth" for lack of a better term.
C) What is your Debt? Do you have any debt at all?
These are all really important questions that will help you determine what you can purchase. The good news is that you dont have to figure it out on your own... But, I can help you understand the math.
Lets use conventional lending, no HOA, 20% down.
50K per year is 4166 per month.
Lets use 300 dollars in "debt payments" (credit card minimums, car, etc.)
Conventional max DTI is 45%.
4166 x .45 = 1875 (this is what you have available for house payment AND debt)
-300 (to strip the "debt" out of the equation)
1575 is what you have "available" for your total mortgage payment INCLUDING taxes and insurance.
TYPICALLY, taxes and insurance make up ABOUT 20% of a payment. SO, if I take 1575 x 80% I get your payment for Principal and Interest ONLY.
1575 x 80% = 1260/mo mortgage payment (excluding taxes and insurance)
Conservatively, that is a loan amount of approximately 270,000 dollars. (Not including HOA, mortgage insurance, etc. if applicable).
Hope this helps so that you understand HOW it works, but you really just need to speak with a good lender... They can do all of this for you (I would hope).
Have a great day!
WJ Bradley Mortgage Capital
If you want a couple of other lenders to talk to, I can forward you some other very qualified lenders that I work with. Once you get started, I can then help you find a home in your budget. You can also go to my website, and start searching homes on the MLS in the area you like, no obligation.
Solutions Real Estate
Your Down payment will Greatly influence how much you can buy.
There are loan programs that may require anywhere from 3% down to 20% down (to avoid added fee of PMI every month).
And your credit score will affect your rate, which will affect how much you can afford.
You really sound like someone who needs to speak to a lender and get a Free pre-approval.
I see that you already have a reply from a lender - so that might be a good start.
Realtor KW Carlsbad
The first step in buying a home is getting pre-approved. That will let you know how much you qualify for and what the corresponding monthly payment would be. That way you can figure out what would be comfortable for you. Message me directly or call me, and I can put you in contact with a lender that can walk you through the process. I specialize in North County, so I would be happy to help you.
Real Estate Broker/ RealtorÂ®
McAllister Homes Real Estate
Residential Sales & Property Management