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Hi Jen, The large down payment will go a long way in your approval. The only income a lender will use is the income that is documented on the tax returns, so you are at a combined $68,000 per year or $5,666.66 per month. The only way to figure out what your proposed debt to income ratio will be is if you list your current debts, things like credit cards, car loans, student loans, anything that reports on credit. You also need to have a pretty good estimate of what the property taxes and home owners insurance will cost. Lets say that you currently have bills that run you $600 per month. We'll add the following estimated mortgage payment. Principle and interest $1207.85 based on a 5% 30 year fixed Home owners insurance $100 per month (estimated) Property taxes = $166.66 per month (estimated) Total estimated payment of $1,474.51 + mortgage insurance Now add the $1474.51 to the $600 per month in other bills for a total of $2,074.51 and divide that by your monthly income of $5,666 and you get a debt to income ratio of 36% which is well under lending guidelines. As long as you have 620+ credit scores this should be very easy.

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by Noneya

3 weeks ago

Asker's Rating: 

If the cash commissions are not claimed on tax returns you cannot use them for income for your loan application. Your monthly income is $5,666 and most mortgage lenders want your monthly P&I plus taxes and insurance to be no more than 28-31% of your income. If you put less than 20% down you have to pay PMI. With $50K down, a conventional mortgage at 5.5% would be about $1277, plus property tax, plus PMI. Don't forget you will also have closing costs, about 3% of the sale price, and you should have some money set aside for maintenance and an emergency fund. You are probably OK, but speak to a lender or mortgage broker to see what you can qualify for. They take into account your credit score, income, other obligations, etc. Good luck.

by CAtransplant- 3 weeks ago

Nobody here can decide for you what mortgage you can afford. 1. What you are comfortably able to afford is personally up to you. 2. Your current debts determine your very important "debt to income ratio". This ratio, which most banks require to be 45% or less, determines whether you qualify. You must understand if you make even a million dollars a year, but have $900,000 in outstanding debt that needs paid, that million dollar income doesn't make a difference. You need to seek out an excellent broker. One with a great reputation and will not rip you off. A broker can take your credit report (debts), tax returns (income) and loan amount to be able to determine if you qualify for a loan, where and in what program. Your credit score also has a large part in the matter. Banks now want a higher credit score than they used to. I used to see credit scores as low as 580 go through, but not any more. You want a score above 720 for great rates.

by hamsterbabies- 3 weeks ago

Before you get all worried about it, talk to a local mortgage broker. The will crunch the numbers and tell you what your options are. You also might qualify fo a little known program than many brokers either don't know about or won't tell you about (because they can't make as much money) that is offered through your state's housing department aimed at lower to median income borrowers and based upon what your incomes are you will likely qualify depending on where you live. This program is often tough to discover so if you tell me where you live, I will help you find it. The advantage is a lower than normal rate and , even though you don't appear to need it, down payment assistance and in some cases tax credits that aren't available to everyone else.

by linkus86- 3 weeks ago

Jen, have you even been prequalifed with a lender? I suggest instead of asking us for our WAG, that you actually talk with several lenders.

by Realtoratheart- 3 weeks ago

Rule of Thumb: You can obtain a mortgage to buy a house that costs NOT more than 2.5 times your annual income. That's income upon which you pay income tax, which you report. You guys are committing tax fraud and over-reaching in the house you want to buy. You have a good down payment which helps, depending on value of home purchased. You need 3.5-5% down FHA and 10-20% down conventional, need 20% down to avoid extra costs of PMI. You need good credit rating, sufficient income, stable employment, adequate down payment, and LOW debt ratio.

by chatsplas- 3 weeks ago