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Hello, folks... I know that 401(k) balances and bonuses can be included in the mortgage qualification equation, but am not sure how much they count. Here is the situation of my girlfriend:
Total salary: $170,000 ($80k base + $90k bonus: avg. of last 2 yrs.)
Stocks/bonds: $70,000
401(k): $50,000
How large of a loan do you think she could she be qualified for with a 30-year Fixed? How 'bout a 15-year Fixed? Also, if she changes employers does she still get to average the last two years of bonuses with the old employer if the new employer is expected to give a similar bonus?
Hello, folks... I know that 401(k) balances and bonuses can be included in the mortgage qualification equation, but am not sure how much they count. Here is the situation of my girlfriend:
Total salary: $170,000 ($80k base + $90k bonus: avg. of last 2 yrs.)
Stocks/bonds: $70,000
401(k): $50,000
How large of a loan do you think she could she be qualified for with a 30-year Fixed? How 'bout a 15-year Fixed? Also, if she changes employers does she still get to average the last two years of bonuses with the old employer if the new employer is expected to give a similar bonus?
If she changes jobs, she will be qualified on the new income only.
Here is a very basic formula for qualifying:
Total gross income monthly x .4
Take this number and deduct all of your monthly payments for loans, credit cards, etc
This will give you a number for total mortgage payment that you will qualify
Better yet - Find a mortgage professional and really find out before you make any offers
Hello, folks... I know that 401(k) balances and bonuses can be included in the mortgage qualification equation, but am not sure how much they count. Here is the situation of my girlfriend:
Total salary: $170,000 ($80k base + $90k bonus: avg. of last 2 yrs.)
Stocks/bonds: $70,000
401(k): $50,000
How large of a loan do you think she could she be qualified for with a 30-year Fixed? How 'bout a 15-year Fixed? Also, if she changes employers does she still get to average the last two years of bonuses with the old employer if the new employer is expected to give a similar bonus?
I don't know what profession she is in, but most lenders will not count "bonus" on a dollar for dollar equivalent basis to salary. A two year track record is good, but if her bonus is dependent upon changes in market conditions, they won't see "bonus" as stable income.
I'm not sure about the mortgage end of it. But if I was making that kind of money I would buckle down for a few years and buy a home in cash.
With that kind of salary enjoy the piece of mind of "not having a mortgage". I really don't understand why people want a mortgage. Get debt free. It is much better.
I'm not sure about the mortgage end of it. But if I was making that kind of money I would buckle down for a few years and buy a home in cash.
With that kind of salary enjoy the piece of mind of "not having a mortgage". I really don't understand why people want a mortgage. Get debt free. It is much better.
Lisa
No kidding. Put all of that bonus away as if she didn't even get it. Live on the salary. In just a few years, you're looking golden.
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