Is it possible to get 450k FHA loan in Seattle with:3.5% down,$6425 monthly income,$0 debt,$10k accessible assets, credit score:734. DTI will be ok??

Asked by Sophie, Seattle, WA Sun Jun 3, 2012

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Sophie’s answer
Sophie, Home Buyer, Seattle, WA
Sun Jun 3, 2012
Thanks for everyone's input! I think i get the whole scenario.
I like to play it on the safe side, just wondering if that DTI is possible. I have a boyfriend to help me with mortgage & other expenses. I figured it would be wiser if I get the mortgage under my name/ responsibilities only, instead of what other couples do. I can live a modest lifestyle w/o him to keep the property, worst case, i sell it. That's why i want it @ a prime location. Again, thanks!
1 vote
Tonya Brobeck, , Everett, WA
Sun Jun 3, 2012
BEST ANSWER
Hi Sophie I'm happy to assist you with a pre approval. Please give me a call anytime 424-268-1066.
0 votes
Christopher…, Mortgage Broker Or Lender, Edmonds, WA
Tue Jul 28, 2015
Sophie, I hope that you are doing well. I just glanced at this question and think I am coming in a little late however I'll give you the same answer as you have probably received many times by now. Coming from a Birds Eye View - Yes this seems possible. However, getting a loan is a lot more detailed than that in which you will need to have your credit run, your history reviewed, and then a Mortgage Officer will truly be able to tell you what you need to hear. I assume that all the answers that have been given come from very qualified individuals in which you will probably get what you need for financing advise. Good Luck!
0 votes
Mon Jul 20, 2015
Here's a list of FHA Approved list of lenders in Seattle you might want to contact.
http://www.homebuyerwise.com/fha-approved-lenders/Seattle-WA_28469

You can also try searching on homebuyerwise.com for FHA lenders in all over Washington and nearby areas.
0 votes
Rhonda Porter, , Seattle, WA
Sun Jun 3, 2012
Thanks for sharing your question - it may help others in a similar scenario. Conventional with pmi has been mentioned - which will require 5% down and 45% debt to income - the transaction will probably be more scrutinized than an FHA scenario.

I've also seen Homepath reference - which is a great program IF you are buying an eligible property (a Fannie Mae foreclosure).

I've been originating mortgages in the Seattle area for over 12 years at the same company and it's my only focus (I'm not a real estate agent - I'm dedicated to mortgage). If I can be of assistance, please let me know. Good luck!
0 votes
Rhonda Porter, , Seattle, WA
Sun Jun 3, 2012
Hi Sophie,
Your DTI is just over 45% based on the info provided - you might qualify depending on what the response is from automated underwriting. If you use rebate pricing to cover most of your closing cost and prepaids, your rate for a 30 year fixed FHA high balance in Seattle would be 3.75% (apr 4.699) based on Friday, 6/1/2012 pricing and a loan amount of $450k - again, this is using rebate pricing to cover most of your closing cost and prepaids. If your real estate agent negotiates the seller paying your closing cost and prepaids, you may be able to qualify for a lower rate.

I'm using your figure of $5000 for property taxes and estimating $50 per month for home owners insurance. This would give you a total payment of $3,051.99 and a DTI of 47%. I'm more concerned about the front ratio than the back - you won't know until your loan is submitted.

Qualifying for a mortgage and being able to live comfortably are often too different things. I don't know what your entire financial scenario looks like - just wanted to provide you with some real figures.

If you are considering an FHA high balance loan (any loan amount over $417k in Seattle is), be aware that the upfront mortgage insurance premiums are going up a bit more effective on case numbers obtained June 11, 2012 and later. This will impact the loan amount you qualify for. For more information, please visit my blog and click on the FHA category.
0 votes
Jirius Isaac, Agent, Kenmore, WA
Sun Jun 3, 2012
Sophie,

As you have read below, there are many ways to look at this. The problem is that we need even more information then you have given us. However, to answer your question in a simple way, yes. However, I would not do an FHA loan, but rather maybe a conventional 5% down with PMI, or a conventional loan with lender paid mortgage insurance, or a 3% down Homepath loan with Fannie Mae paid mortgage insurance if the home qualifies. these all may be better options given your good credit score.

Feel free to give me a call if you want consult about these & other options & to get pre approved at 206-841-9976. I would love to help you out.

Take care, Jirius Isaac
Web Reference:  http://tristarfinance.com
0 votes
Tonya Brobeck, , Everett, WA
Sun Jun 3, 2012
Oops my number is 425-268-1066, sorry!!
0 votes
William Pola…, Mortgage Broker Or Lender, Suwanee, GA
Sun Jun 3, 2012
King county allows up to $567,500. You don’t have enough money for down payment, so you’ll need to qualify for the Home Key Plus program (see link below). You can get up to $10,000. As much as I would love to do your loan (I’m licensed in all 50 states), I’d rather you use a bank that is familiar with this program than for me to tell you that I know what I’m doing, when in fact I didn’t even know such a program existed until you asked.

I can tell you that Conventional lending won’t allow you to use this program because your own funds must be used for down payment.

Let’s see if using Fannie or Freddie puts you ahead in terms of savings. For Fannie and Freddie (conventional lending), you’ll need 5% down and have at least the equivalent of 2 mortgage payments sitting in a retirement or bank account. Your credit file must contain 3 lines of credit currently open and active within the last 12 months.

The difference in payments:
FHA Mortgage Insurance (MI) up front: 1.75% financed into the loan
Conventional Mortgage Insurance up front: None
Monthly FHA MI payment: 1.25% of the loan amount times the loan amount divided by 12 = monthly payment - $460 a month (based on loan of $442,0000 : $435,000 plus 1.75% up front fees)
Monthly Conventional MI payment: .0101% - $359 a month (based on loan of $427,500)
So, putting down an extra $7500 saves you about $101 a month in payment.
The difference in down payment between the two programs is about $5 per thousand. That’s about $38 a month which gives you a savings of about $63 a month on your payment.
Now, let’s take the $7500 extra that you paid and divide it by $60 = 126. This means that if you keep the house for more than 126 months (a little over 10 years), then it will benefit you to buy using conventional lending. Otherwise, FHA is the way to go.
0 votes
Dan Chapman, Mortgage Broker Or Lender, Kirkland, WA
Sun Jun 3, 2012
HI Sophie, You should be fine up to 45% DTI, maybe more even.
But I don't recommend going past 30% on your Housing ratio
because unexpected things can come up and this will give you
freedom to do other things like invest for retirement and
build your savings.

Thanks, Dan
0 votes
Sophie, Home Buyer, Seattle, WA
Sun Jun 3, 2012
About $5000 annual taxes, not sure on insurance & not interested in buying property w/ HOA.
Area of interest is around central business district downtown seattle.
0 votes
Rhonda Porter, , Seattle, WA
Sun Jun 3, 2012
Sophie, Do you know how much your property taxes, home owners insurance and HOA dues will be (if any)? It looks like you're considering an FHA loan (3.5% down) which has a limit of $567,500 in the Seatlte, King/County area.
0 votes
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