Author Topic: Getting a fixed private loan vs traditional mortgage. Unique  (Read 320 times)

zoochadookdook

  • Bristles
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  • Age: 27
Getting a fixed private loan vs traditional mortgage. Unique
« on: April 12, 2019, 08:36:19 AM »
Hey all I'm 26/27 in may
I have been in m my house for the last 3.5 years (october 2015)
Purchase price 141. Currently market value is around 190.  Put around 15k down if I recall.

I did not qualify for a mortgage as I've been self employed the last few years. My father is retired and has a sizable 401k/other accounts. He took a private variable loan from edward jones against his 401k-I believe it's the prime rate - half a point. This is obviously less than ideal. I also owe him 15,000 on the side interest free.

I'm considering my options towards a refinance to get his name off the title/the loan by the end of this year. My payment is $586/mnth. The  loan amount was $97834.98 as of December 2018 with $4431.79 in interest paid.  This year through March $1067.53 interest paid.

Because the property is not actually tied to a mortgage it would be possible to get a standard fixed loan instead of a mortgage. This becomes of interest relating to my taxes. I am doing them for 2018 right now and while a mortgage averages your last 2 years of AGI income as self employed-I don't know if a traditional loan would do the same. If so I would consider taking less mileage write offs/no SEP contribution for 2018 to get my AGI higher (yes more taxes); if not I would take my write offs as normal.

In 2018 I made around 5200 w-2 part time/35k self employed (no w2 no employees just myself). With write offs I am around 27000 AGI currently.

In 2019 I am projected around 35000 agi with my new hourly contract job (post tax).

Current finances:
roth IRA $26,500
CASH/money in bank (need to figure out how to invest still) $69,500
Stocks/bitcoin: $1600
TOTAL: $71,300

Debt: $6075 credit card (only this month-hit some spending bonuses, will be paid off in 2 days with no interest collected)
$13,200 in student loans (also paying off before interest starts in july this year-using 3 CC's to get $2400 back)

Total: Around $50k cash/bank and 26,500 roth after all debt payoffs currently and taxes paid for 2018.

Monthly expenses
$1200 base living (mrtg, prop taxes, insurance car/home, utilities)
$150 health insurance
$500 roth IRA
gas/food/other 150-250

Take home pay mnthly
$3000



Any advice on how to go about getting this loan/mortgage? I know it's not typical but I've been trying to figure out the best course of action and I'm sure someone in here knows way more than I do!

Tuskalusa

  • Bristles
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  • Posts: 385
Re: Getting a fixed private loan vs traditional mortgage. Unique
« Reply #1 on: April 12, 2019, 08:39:23 AM »
Might be worth checking if you again can get a traditional mortgage now. If you have 3 years of self employment, you might be able to demonstrate that you have the income to qualify for a loan.

Have you talked with a mortgage broker recently?

zoochadookdook

  • Bristles
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  • Posts: 424
  • Age: 27
Re: Getting a fixed private loan vs traditional mortgage. Unique
« Reply #2 on: April 12, 2019, 09:17:29 AM »
Might be worth checking if you again can get a traditional mortgage now. If you have 3 years of self employment, you might be able to demonstrate that you have the income to qualify for a loan.

Have you talked with a mortgage broker recently?

Yeah so my income the past few years after write offs has been around 10k or so. 2018 should be around 25k/current new "salary" is 45,000 gross.

The main issue is I drove my beater 04 civic like 30k a year/20k for work and the mileage write off/student write off was hefty. No it doesn't cost me .52 a mile to drive the car but the government deems that as the write off.