When applying for a loan, the broker will pull credit, look at job history, income, debt and stability of the person(s) applying for the loan. If the debt to income level is too high, you will not qualify in today's market.
Sometimes paying off a debt with cash will bring the debt ratio to appropriate levels for financing guidelines. This happens all the time. With or without a co-signer, the debt ratio must be at or under guidelines to be successful.
If all ratios are correct and the credit score high enough, and there are no late payments in the past 24 months for an FHA loan, or 12 months for a VA loan there shouldn't be a problem obtaining a loan from a reputable lender. Not all credit lates will stop one from buying a home, especially if they are medically related, as a letter of explaination (LOE) will be required and will need to be signed off on by the lender's underwriter.
Never sign anything you don't understand ever. Why would you?
The process though me or any other lender should be:
1. You fill out an application and get pre-qualified i.e. looks as if you can get funded for a home loan.
Next they will run your credit, if the credit is clean of recent deliquent payments or collections etc, you will now supply your broker with your last two paystubs, last 2 years income taxes w/ W-2's and last 3 months bank statements including all pages i.e. if page one says, page 1 of 3, you must supply all three even if the last page is blank.
2. Broker submits loan package to various lenders for approval. Here some questions may arise and need to be explained further before loan approval is granted. When granted, you will know what price range you may now begin looking for in a home.
3. Approval granted and now you give your pre-approval letter to Real Estate Realtor/agent and begin looking for homes that you're qualified to buy.
4. You will find a home, submit an offer with your pre-approval letter and then once an offer is accepted you are on your way and will begin the inspection process to ensure that you are getting a worthy home.
If I or anyone here can be of further assistance, contact them and they would be happy to answer your questions as that is what we're all here for...to assist you...this is what we do!
Great question and thank you for the opportunity to explain the process to you Mz. Cohen. Best of luck!
Best of Luck to you
Now as to a co-signer ... FHA offers you the option of having a non-occupying co-borrower. Their credit history, their income, assets and all of their credit liabilities come into play AND many times this is just the help you need to qualify. The loan approval process does not have to be difficult if you plan ahead.
To get started you need to go over your homeownership and financial goals with your loan officer. They will help you decide of the best strategy for you. It is best to have your lender crunch all your numbers before you go house shopping that way you are in the best position to make an offer as you will not be starting from ground zero.
If you would more information on the best way to shop for a mortgage, visit my website or give me a call for the answers to four questions you must ask your new lender.
Good Luck to you ... this is a very exciting time to be buying real estate.
Jane Whitten, Loan Officer/Windsor Capital Mortgage 562-728-9971
It's time to begin collecting information about both the lending process and buying process.
Our recommendationis to begin with the lending process, which will help yo identify what your purchase limit price is and get you started collecting information about various programs available to you. We strongly suggest requesting a "good faith estimate" from each loan agent you work with. This will serve are a record of programs and rates specifically quoted to you.
Considered by many as an overwhelming and often confusing task because of a completely unfamiliar language filled with terms and jargon that leaves many "scratching " their heads. Do not allow the agent to drop terms.....insist they explain things in clear everyday understandable language that anyone can grasp.
If you don't understand something, make them explain it again.
You'll soon be on your way......
Once that process is complete, you will meet with your agent and begin looking a property. A professional Realtor will be able to assist you in making a wise investment and will preview propery for you.
You may use a co-signer to overcome the debt to income ratio but remember, the banks add ALL OF THE DEBT together to determine elibility. If your co-signer has excellent credit but has alot debt, you're back to square one. You want an co-signer who has low debt. Remember even if deferred, student loans are included in the total overall debt calculation.
Best of luck to you,
JACQUELINE L. CLARKE
Down Payment Assistance Specialist/Loan Officer
Enterprise Mortgage Group, LLC
1850 Lee Road, Suite 140
Winter Park, FL 32789
In the meantime you can search for homes for sale at http://www.tovasarir.com
If you have any further questions, feel free to contact me at email@example.com or 310-497-1930.
Keller Williams Realty Beverly Hills
Good Luck and if you have any questions please e-mail or call me.