Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
Hubby and I were planning on selling our current home in th spring and finding a new home. I stumbled upon a great deal on a short sale in a perfect location for us. It appears the bank is willing to accept between 100-105'000.
Our current house we bought for 80,000 and owe 69,000 on...we got this house for a good price at the time. Our realtor still has to come look but with knowing the property from when we bout it, seeing our list of improvements, comparables she was thinking we could list for between 95,000-105,000 so we feel confident we could make around 20000 + on it. Houses sell rather quickly in our area.
Our finances...before taxes we make about 97,000, both have 760 credit rating, very little debt. We did have over 25,000 in savings last year at this time but bought a new car and repointed some bricks on our current home that needed it so we only have about 3000 in savings. We were prequalified for $190000 last month and since then picked up an additional $200 month in raises. It seems to be a bad time of year to try and sell so i am running scenarios on making his work...
1. Borrow the $20000 from a relative to cover our down payment money and pay them back upon sell of our house. Hope that a bank will let us carry the 2 mortgages...my monthly budget says I could cover both mortgages just not sure the relative would do the loan because they don't really like to do those sorts of things.
2. Borrow $20000 from my 401k and pay back upon sale.
Would a bank even let me carry 2 mortgages in these scenarios....could I refinance my current home and roll in with new sale to even get a lower payment overall? Any other options? Thank you for your time.
The bank will let you carry 2 mortagages. You have to be aware the 2nd property will be considered an investment property or a second home if far enough away from your current primary residence. The rate will not be the best. Your debt to income ratio will be determined with your current mortgage loan. You say that you were prequalified already so your debt to income should be fine. Hopefully, whomever qualifed you did inform you that the 2nd property may or not be considered an investment property. Most banks now want at least 20 percent down for an investment property. Make sure a repayable loan is acceptable for downpayment assistance. Some banks may count this against your debt to income ratio and some loan programs will not accept funds that are not borrower funds solely. Best of luck to you. Hopefully, I haven't confused you.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
