Author Topic: Estimates on what kind of Mortgage I could qualify for?  (Read 520 times)

ILikeDividends

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Estimates on what kind of Mortgage I could qualify for?
« on: July 02, 2019, 03:15:13 PM »
Is anyone willing to offer a non-binding opinion of whether, and how much
of a mortgage I might qualify for based purely on hypotheticals?  Those being:

1) $1994 Social Security income
2) A $100,000 1st Mortgage *
3) Assume a credit score of over 700
4) No personal debt except for a credit card balance that I pay off every month.
5) I am a veteran and might qualify for a loan from the VA?
6) I would reside in the home

* I don't need to finance the whole amount, but I'd like to know how much of it I might be able to qualify for.

I don't want to include any income or capital gains for qualifying; assuming I even could do that.

No mortgage company will give me even a guess, only an actual quote.  And they can't give me a quote yet because of certain unresolved issues which I will disclose here if you think it relevant. 

Pointers to an on-line calculator would be appreciated, too.  The only things I can find are portals to hook you up with an actual lender who I already know won't give me what I want.

Anyone game to try?
« Last Edit: July 02, 2019, 03:41:43 PM by ILikeDividends »

August26th

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  • Location: Beautiful Colorado
Re: Estimates on what kind of Mortgage I could qualify for?
« Reply #1 on: July 03, 2019, 07:29:43 AM »
Napkin math...

I will assume the $1994 SS income is non-taxable. In that case, it can be grossed up 25%, so your total monthly qualifying income is $2492.50.

If your lender requires you to stay at or under a 45% debt-to-income ratio, then the sum of ALL monthly debts that would show up on a credit report, including the proposed mortgage payment, would need to stay under $1121 per month. As long as the payments stay under that amount, you should be fine.

Impossible to give a quote without knowing the property taxes and insurance of the home youíre buying. Iíd guess if you borrowed 100k, that principal and interest payment would be between $470-$525 per month.

Hereís a simple calculator:  https://www.mortgagecalculator.org/calculators/mortgage-payment-calculator.php

ILikeDividends

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Re: Estimates on what kind of Mortgage I could qualify for?
« Reply #2 on: July 03, 2019, 12:32:50 PM »
@August26th, thank you very much for taking a swag at this.  If your guess is even close to reality, then it appears I can easily finance this purchase, if I want to.

Regards.

Edit to add a related question:

Seems as though you know something about the lending industry.  Let me share a few more details about this transaction in order to frame the question.

The property I'm looking at is titled to a trust which I have a 50% interest in.  I haven't gotten the appraisal back yet, but according to redfin it should come in around 208K or so.  If you know anything about reverse mortgages, I'd appreciate any napkin math regarding that kind of scenario.

If I used a reverse mortgage option, it seems I could basically get this house with little or no money out of pocket, and no mortgage payments going forward.  Too good to be true?  What's the catch?

Is that even an option; can you actually buy a house using a reverse mortgage?  Or would I have to get a regular mortgage first, and then pay it off with a reverse mortgage?

I am 62, so I do qualify from that standpoint.  No wife and no kids, so I'm not concerned with leaving the house to anyone when I die.  Any other pros or cons to a reverse mortgage I should be aware of?

Since there are no payments on a reverse mortgage, I assume it has negative amortization which, if I do decide to move, I would have to pay, possibly, much more than I borrowed from it.  But if the house appreciates faster than the mortgage balance, then this might be ok?

ETA II:  Ah, answered my own question. Found this RM calculator:
https://www.reversemortgage.org/About/Reverse-Mortgage-Calculator

I would only be able to get $45,828 in the first year; assuming I could even use a RM to purchase a property.
« Last Edit: July 03, 2019, 02:00:56 PM by ILikeDividends »

August26th

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Re: Estimates on what kind of Mortgage I could qualify for?
« Reply #3 on: July 04, 2019, 07:58:40 AM »
It is very possible to get a reverse mortgage as a purchase. I honestly donít know much about them. The only negatives Iíve heard about are that the fees tend to be high, but otherwise, it is a legit option, especially if youíre not worried about leaving the home or its equity to anyone.