If my monthly income is 5600 and my mortage payment 2300 and no other debt, would I be able to qualify for a FHA loan. Thankyou

Asked by Ethan, 17313 Sun Mar 4, 2012

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, ,
Mon Mar 5, 2012
Hi Ethan,

Does the $2300 per month include taxes, insurance and mortgage insurance?
Is this for a refinance of your existing loan or to buy a new home?
If you're buying a new home, are you keeping and renting your current home or are you going to sell it?

You may want to look at a no money down USDA loan instead of FHA and here's why.

On a $250,000 loan the FHA monthly mortgage insurance is going to add $240 to your monthly payment and it's going to go up starting April 1st.
With a USDA loan, the monthly mortgage insurance on a $250,000 loan is only going to add $63 to your payment which is going to reduce your debt to income ratio.


Please feel free to contact me for more info or help.

John Burke
Senior Mortgage Banker
ENG Lending
(877)228-9069
jburke@englending.com
1 vote
, ,
Mon Mar 5, 2012
I had the same questions as John on this.

As for the USDA vs FHA scenario, while the USDA has lower monthly insurance costs, the qualifying ratio for a USDA loan is much lower than a FHA loan (when compared to automated approvals). USDA wants to see your housing obligation no higher than 31% of your gross income, which on $5600/mo, would be $1,736/mo, you clearly wouldn't qualify in this scenario for the USDA loan.

FHA on the other hand wants to see the same ratios (the general guideline or manual underwrite) but the automated underwriting engine is MUCH more lenient on it's automated approvals. I've had clients be approved with as high as a 55% debt ratio (mortgage, insurance, taxes plus other monthly debts that report on their credit report) which would be $3,088/mo.

Since we don't know what your credit score is or what your reserves look like (cash reserves greatly influence automated underwriting's ability to approve higher ratio loans), it's impossible to give a yes/no answer without putting it through the automated underwriting system.

Feel free to call me if you'd like to run it through or direct your lender to do this for you as they should be able to tell you this without much trouble.
Web Reference:  http://RobWeber.com
0 votes
, ,
Sun Mar 4, 2012
Hello Ethan,

Call me at 267 992 7276. There are too many unanswered questions to give you a definitive answer.
Does your mortgage payment include taxes and insurance.
How long have you been at your job? Is it hourly, salary, or commission? Do you get overtime? Do you have unreimbursed employee expenses/ These are all factors that can affect a loan approval. If you have no debt, do you have deferred student loans, or child support or alimony.
Two minutes on the phone will determine whether or not you qualify but asking the only half of the right questions on the internet will likely get you an an answer that may only be half right too.

Regards,
Alan Openshaw
Cornerstone Lending Inc
Southampton Pa 18966
215 953 0800
cell 267 992 7276
VOTED BEST IN BUCKS 2010
NMLS ID 143960
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