My husband and I are thinking about buying a house with an FHA Loan, but we need $20K more of income to

Asked by Monica Garcia, Simi Valley, CA Tue May 12, 2009

qualify for $280K home loan, eventhough we can pay it with our salary but we don't pre-qualify for that amount. Do we look for a co-signer?

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Barry Shapiro, Agent, Camarillo, CA
Sun Jul 17, 2011
Hello Monica,
Home prices have plummeted since your posting 2 years ago. If your debt-to-income ratios have remained the same, you will qualify for that home of choice you have been longing for. Check in with Ted Mackel or Bonnie Sterling to arrange a complimentary 15 minute Buyer Consultation. Interest rates are expected to increase in the several months due to national economic factors, so timing is important for you to capitalize on this window of opportunity. Otherwise, you may need to wait until you become a senior citizen :-)
1 vote
George Raymo…, Mortgage Broker Or Lender, Fort Worth, TX
Tue Jul 19, 2011
Hello Monica,

Before you go to the next step of either throwing in the towel, changing areas or waiting for a miracle by winning the lottery, try getting a second opinion. Please remember every lender is different and all loan officers are not equal. Although there are certainly some great ones out there, I run into some real winners. Please take the time and speak to another LO just to make sure your really capped at the lower sales price.

Best of Luck!
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0 votes
Michael Abram, , Los Angeles, CA
Sat May 7, 2011
Hello Monica,

As mentioned below, your DTI ratio is one of the most important factors in determining a pre-approval. One thing you can consider would be paying down some of your existing debt that appears on your credit report. Removing this debt gives you a little more flexibility to increase your buying power. However, you then have to factor in items like "will you have enough funds to cover your down payment & closing costs." You should speak to your loan officer and see if there are any revolving accounts, auto loans or other installment loans that you could pay down to help increase your buying power.

One more thing to consider is to ask your loan officer what interest rate he qualified you at on an FHA loan. Right now, rates have come down and conforming FHA rates are around 4.50%. If he qualified you much higher, bringing the rate down will lower your DTI.

If you have any questions, i'm more than happy to help.

Michael Abram
FIrst Capital Mortgage
NMLS #235060
DIrect: (310) 434-1718
0 votes
Tom Kessler, Agent, Oxnard, CA
Thu Apr 14, 2011
I would suggest buying in a nicer area of Oxnard. It is only 25 minutes away and a similar home is $100,000 less.
0 votes
Laurel Fulke…, Agent, Northridge, CA
Tue Jan 25, 2011
It is harder to pre-qualify for loans today. Guidelines are tighter, and it is difficult sometimes to qualify for the amount you need to buy a home or townhome. So the best solution is to get a co-signer. One of your parents would be the ideal choice. Most parents are willing (if they are able) to co-sign for their son or daughter. They know how important that "first home" is.

If you are interested in a townhome in the San Fernando Valley, I have a beautiful listing -- 3 bedroom townhome in Winnetka that is almost 1600 sq. ft. for $299,999.

Laurel Fulkerson
Century 21 Hilltop
(805) 405-0652
0 votes
Alicia Nolan, , Birmingham, AL
Wed Jan 19, 2011
Well where do you live? because their are way too many houses for sale that are not close 280k that are almost brand new. You have to be able to look at a home and see what is good about and what is bad. Noone no matter what state should be paying that much for a house the way the economy is right now.
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Nila De Silva, Agent, Simi Valley, CA
Wed Jan 19, 2011
Hi Monica,
As a realtor & homeowner I would like to advice you to purchase a home with what you really can afford/ that will be what lender will qualify you for not what you think you can pay for. In this down economy it is better be smart rather than sorry ...loosing your home later or struggle with your mortgage payment in the future is not a good idea. This is what happen to most of the homeowners in this economy buying a home more than they can afford. It is always best to keep a cushion in your mortgage payment in case if you have hardship in the future or if you loose a job,loose your income,etc.
Some purchases you can ask seller to pay your closing clost up to 3%. You can certainly try for that. I'll be happy to guide you with your purchase. Please feel free to call me. (805) 520-1660 Direct or (805) 795-1599 Cell
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Kellen Gracey, , 33304
Thu May 14, 2009
Your debt to income ratio is an important facet of your loan process, particularly with the number of defaults across the country right now - lenders are becoming stingy with who they lend to.

There are a couple of different ways to bypass that problem, including reducing the amount you purchase the house for, getting creative with financing (owner financing, etc.) and there is also the option of a co-signer. However, having a co-signer ties them up with the property as well - which is a risk on both of your parts.

I have the ability to help you out with this problem. Feel free to contact me if you have any questions or are interested in qualifying for a purchase loan.

Kellen Gracey
Mortgage Professional
BayBurg Financial
(386)237-7231 Cell
(954)764-7064 Office (Ext. 214)
0 votes
Ted Mackel, Agent, Simi Valley, CA
Tue May 12, 2009

Your question has many facets. Why are your ratios out of wack if you have income? Do you have debt you can pay down to help your ratios? This may be easier.

A co signer will help but you cosigner will have to be on the purchase contract and will have to be on title to the property. If your co-signer is married then on FHA they will run the non occupant co borrower and the spouse of that co borrower.
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Bob McClure, Other Pro, Walled Lake, MI
Tue May 12, 2009
good afternoon monica.....for that little amt..there has to be a much easier way of using your current income and debts to make it all work....however,a non-occupant co-borrower is allowed for if q's.thank you..bob mcclure.....
0 votes
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