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Old 12-26-2012, 01:55 PM
 
32 posts, read 93,215 times
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Has anyone ever taken out a mortgage for $50,000 to $75,000? Am I better working with a mortgage broker? Should I go directly to a bank or credit union?

Let me know if you have any experience with borrowing under $100,000 for a mortgage.
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Old 12-26-2012, 06:34 PM
 
Location: East of Seattle since 1992, originally from SF Bay Area
40,722 posts, read 72,709,165 times
Reputation: 50262
Yes, $45,000 but that was our first house in 1976. Regardless of the amount, I would recommend trying a credit union first, they are more honest and reliable, and not for-profit. In your case, the banks may not be as anxious to help you with such a small amount, since their profit will be so lo compared to most mortgages.
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Old 12-27-2012, 06:44 PM
 
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i disagree that credit unions are any more or less honorable than any other bankers.

But the mortgage amount is so small that going to a broker will not save you much and they wont want to do the loan .

Mortgage brokers do the same amount of work on a 50k loan and a 600k loan. The difference in commission is $500 gross before splits and expenses and $6000 gross before the slicing and dicing.

Here is a link where you can hook up with your favorite community bank.

Compare Interest Rates | Mortgage CD Insurance Refinance | Bankrate.com
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Old 12-30-2012, 12:13 AM
 
Location: Marshall-Shadeland, Pittsburgh, PA
32,219 posts, read 74,202,066 times
Reputation: 18404
I'm also interested in hearing some responses. I hope to purchase my first home in the $30,000-$40,000 range in early-2013 using an FHA-backed loan and putting 3.5% down. My credit is only in the mid-600s, my debt-to-income ratio isn't the greatest, and it would take me several more years to save the amount needed to put 20% down, and I fear by that time that housing prices in the neighborhood I'm looking into will have appreciated moderately.

Here's some raw data:

INCOME: $30,000/year from my primary position, which I've had for about a year, and I can easily pick up a shift at a moment's notice at a second job delivering food---I've had that position for about a year-and-a-half.
STABILITY OF RESIDENCY: I've lived at the same address for over two years.
STUDENT LOAN DEBT: $15,000
CAR LOAN: $8,500
CREDIT CARD: $900
FICO: Mid-600s

I currently pay $700/month, which I split with my partner so we each pay $350/month. As such I can easily afford to pay up to $700/month for mortgage+taxes+insurance+PMI, as even though I'm going to be the sole applicant on the loan I plan to charge my partner rent the equivalent of half of my monthly housing costs. I've considered using him as a co-applicant to see if adding in his $20,000 annual income would help, but he's also saddled with student loan debt, and his FICO score is probably below 600.

Do any of you think ANYONE would finance me with an FHA-backed mortgage in the $30,000-$40,000 range, given those above variables? Should I consider a credit union first?
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Old 12-30-2012, 08:40 AM
 
28,460 posts, read 81,567,320 times
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FICO strikes me as low. What is the total amount of credit card debt that you are carrying? I suspect the $900/mo is too close to the minimum. Reduce your total consumer debt /excellerate student loan pay down / build up savings. Yeah, I know you "can't do all that" but prioritize in the order listed. How many credit card accounts do have? What do you use'em for?
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Old 12-30-2012, 03:35 PM
 
426 posts, read 1,865,401 times
Reputation: 130
Quote:
Originally Posted by SteelCityRising View Post
I'm also interested in hearing some responses. I hope to purchase my first home in the $30,000-$40,000 range in early-2013 using an FHA-backed loan and putting 3.5% down. My credit is only in the mid-600s, my debt-to-income ratio isn't the greatest, and it would take me several more years to save the amount needed to put 20% down, and I fear by that time that housing prices in the neighborhood I'm looking into will have appreciated moderately.

Here's some raw data:

INCOME: $30,000/year from my primary position, which I've had for about a year, and I can easily pick up a shift at a moment's notice at a second job delivering food---I've had that position for about a year-and-a-half.
STABILITY OF RESIDENCY: I've lived at the same address for over two years.
STUDENT LOAN DEBT: $15,000
CAR LOAN: $8,500
CREDIT CARD: $900
FICO: Mid-600s

I currently pay $700/month, which I split with my partner so we each pay $350/month. As such I can easily afford to pay up to $700/month for mortgage+taxes+insurance+PMI, as even though I'm going to be the sole applicant on the loan I plan to charge my partner rent the equivalent of half of my monthly housing costs. I've considered using him as a co-applicant to see if adding in his $20,000 annual income would help, but he's also saddled with student loan debt, and his FICO score is probably below 600.

Do any of you think ANYONE would finance me with an FHA-backed mortgage in the $30,000-$40,000 range, given those above variables? Should I consider a credit union first?
Hi.

Go to your local bank for this one. I dont think there is an FHA minimum loan requirement so a small mortgage should be ok. The bank or credit union can handle these small balances better.

Your mid 600 fico will cost you a 1/4 on the rate and a high upfront FHA fee , but on a loan this small, its negligible.

Your partner is another story. I have come across this many times in my career and here is the advice I give.

You can only use his income if he applies with you on the mortgage which can cause all kinds of problems if you break up. I would suggest asking your loan officer what the lender specific rules are regarding making him your renter.

FHA may also have renter specific criteria . If its as simple as producing a lease , then go for it.

But 30k a year is easily enough income to afford a 40k house. You should be fine without your partner.

The only real concern is the job time. Generally they want 2 years on the same job. However, if you have been continually employed for 2 years in the same kind of profession, you can submit that evidence and it will suffice.

Hope this helps
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Old 12-30-2012, 10:29 PM
 
Location: MID ATLANTIC
8,458 posts, read 21,876,041 times
Reputation: 10034
Close attention should be paid to anyone discouraging a potential borrower from borrowing a low loan amount. It's perfectly permissible for there to be higher charges for the low loan amount, and most investors have a low loan limit anywhere from 25K to 40K. And while it's honest say the broker doesn't make as much and doesn't want the loan, it's not that much different for the loan officer at a bank.....but we also have been drilled that turning away the borrower due to low loan amount can be considered discriminatory.
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Old 01-01-2013, 09:06 AM
 
Location: Berkeley Neighborhood, Denver, CO USA
17,220 posts, read 27,379,119 times
Reputation: 31762
Default Got a $20K mortgage in 2012

We bought our house for cash ($480K) in mid-2011.
Then, in early 2012, we wanted to do some landscaping.
Went to the credit union (I have a 35 year history with them) for a HELOC and we could not get one because we did not have a mortgage. They did offer a personal loan at 9%.
Now, we have a mortgage.
$20K, 3%, 5 years.
The credit union paid 100% of the $1600 in fees. They did a full-blown appraisal.
They will never make money on this loan.
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Old 01-01-2013, 09:58 AM
 
426 posts, read 1,865,401 times
Reputation: 130
Quote:
Originally Posted by davebarnes View Post
We bought our house for cash ($480K) in mid-2011.
Then, in early 2012, we wanted to do some landscaping.
Went to the credit union (I have a 35 year history with them) for a HELOC and we could not get one because we did not have a mortgage. They did offer a personal loan at 9%.
Now, we have a mortgage.
$20K, 3%, 5 years.
The credit union paid 100% of the $1600 in fees. They did a full-blown appraisal.
They will never make money on this loan.
I understand your logic, but if you go through your paperwork, you may see a 3 year provision of closing costs. As long as you keep the HELOC or loan open for 3 years, you dont have to repay that 1600 in closing costs.

They needed to do a full bore appraisal on a 20k loan on a 450k house?
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