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Add me to that too. 360K loan with 87K income is not conservative at all and I hope you know what you are doing and best wishes. Now you heard all sides and please don't come here asking how to sell short
All I can say is he better hope the economy turns around soon (Even though there are ZERO signs of that happening).
I really want to offer you my best wishes too. I hope for your sake, my tax dollars sake, and my future kids sake,that you are able to pay your mortgage. Unlike several other million people who couldn't/cant.
Just remember, its like riding a motorcycle, you may be real good at it but sometimes its the other drivers you have to worry about. You may be good at managing your bills but if one thing goes wrong, you will spiral out of control so fast your head will spin with that DTI/Loan you have.
I don't understand people on these forums and in general. This poster wants a loan that's more than 4 times his income and is ok with paying for this for 30 years. In 30 years, people can die, get sick, get into an accident or God knows what.
I don't understand how people are even ok with 30 year fixed mortgages. Maybe someone who's older (and has been paying a mortgage for like 20 years and continuing to refinance to new 30 year mortgages) can give some insight on this as I'm only 29. Am I the only one who is thinking about purchasing something cheaper/smaller and paying it off in 5 years?
I just can't wrap my head around these 30 year mortgages.
I don't understand people on these forums and in general. This poster wants a loan that's more than 4 times his income and is ok with paying for this for 30 years. In 30 years, people can die, get sick, get into an accident or God knows what.
I don't understand how people are even ok with 30 year fixed mortgages. Maybe someone who's older (and has been paying a mortgage for like 20 years and continuing to refinance to new 30 year mortgages) can give some insight on this as I'm only 29. Am I the only one who is thinking about purchasing something cheaper/smaller and paying it off in 5 years?
I just can't wrap my head around these 30 year mortgages.
Why can't someone say the same thing about taking out a loan for five years? Someone can get sick, die, have life changes in five years. Why not pay cash and own the home outright?
While what you are saying and trying to achieve is very respectable, its not always possible. One reason people have to finance homes is due to the increase in housing prices far outweighing incomes. See the first chart:
I don't understand people on these forums and in general. This poster wants a loan that's more than 4 times his income and is ok with paying for this for 30 years. In 30 years, people can die, get sick, get into an accident or God knows what.
I don't understand how people are even ok with 30 year fixed mortgages. Maybe someone who's older (and has been paying a mortgage for like 20 years and continuing to refinance to new 30 year mortgages) can give some insight on this as I'm only 29. Am I the only one who is thinking about purchasing something cheaper/smaller and paying it off in 5 years?
I just can't wrap my head around these 30 year mortgages.
This should get you going. Do you know there is no age limit to obtaining a 30 year mortgage? You can be 100 years old and get a 30 year mortgage.
Again, everything you stated is your opinion. I'm not a loan officer and neither are you. The truth is, there is no telling how long it will take him. There is so many variables involved its not even funny. For someone to come out and say it can't take 60 days and "hasn't seen that with any lenders" is just out and out wrong. It can take 60 days and this guy is going to have major buyers remorse if he buys a 417k house on a COMBINED annual salary of 87k. He is also on the edge with a 41% DTI (If he is right about that number), he is more likely to be scrutinized vs. someone with a 30% DTI ratio. Which could certainly = more time to close the loan. It doesn't take a loan officer to know that. Sorry.
He seems like a great guy who has always paid his bills on time, however, what he is getting himself into is what helped cause this deep recession we are in right now. People buying more than they can afford.
Also, you should read this forum more because you will run into plenty of people that are having issues getting their loans closed in a timely fashion. See below for a prime example. They are tightening the lending standards and I'm glad they are doing it.
Just because you have had a good experience doesn't mean everyone else has. Also, there are plenty of loan officers on this forum looking for business so you aren't always getting honest posts from them either.
This is a post by someone else on this forum. User name Alipie34... send them a PM and ask them how long they have been waiting and what all they have had to provide.
"i having been waiting to close on a house since 3/6/2009, i am still waiting. this is a fha loan. i've been jerked around by the mortgage broker and the lenders. i was asked to give bank recent bank statements every week. they had to be stamped by the bank and signed off on. i had to provide numerous letters on any money that was deposited to my account that was not direct deposited. i was told by my mortgage broker that i have been approved with conditions, i have not seen any paperwork and the lenders are still requested updates on my bank account. i am frustrated!"
There is a HUGE difference in getting files approved through underwriting when comparing:
an established person with A+ credit, plenty of money for a down payment, with substantial reserves
VS.
a first time homebuyer with minimal job history, with minimal money, with modest or bruised credit trying to get a minimum down government backed FHA loan.
I don't understand people on these forums and in general. This poster wants a loan that's more than 4 times his income and is ok with paying for this for 30 years. In 30 years, people can die, get sick, get into an accident or God knows what.
I don't understand how people are even ok with 30 year fixed mortgages. Maybe someone who's older (and has been paying a mortgage for like 20 years and continuing to refinance to new 30 year mortgages) can give some insight on this as I'm only 29. Am I the only one who is thinking about purchasing something cheaper/smaller and paying it off in 5 years?
I just can't wrap my head around these 30 year mortgages.
I definitely agree with you in that this OP, no matter how frugal he is, is getting in way over his head - like I said, we wouldn't do this and we make a lot more money than he does. When it comes to household maintenance, and "oh crap" repairs, you can't be frugal.
However, I can tell you why we chose a 30 year mortgage - the lower payments are a safety net. We can always double payments when we can, and if we need extra cash, do regular payments.
I definitely agree with you in that this OP, no matter how frugal he is, is getting in way over his head - like I said, we wouldn't do this and we make a lot more money than he does. When it comes to household maintenance, and "oh crap" repairs, you can't be frugal.
However, I can tell you why we chose a 30 year mortgage - the lower payments are a safety net. We can always double payments when we can, and if we need extra cash, do regular payments.
I understand taking the 30 year, and perhaps Sheenie understands that too. I think Sheenie is making the point that this guy is taking a 30 year mortgage and doesn't have a chance to pay it down sooner because he will barely scrape by, with the mortgage payment and bills he will have. He is setting himself up for an EPIC failure. Also, I think if you looked into it further you would fine they are falling in love with a DREAM home they cannot afford. Not buying it out of necessity etc.
I have a 30 year loan and I'm on a 10 year pace to pay it off. I, like you, make much more money than the OP, and wouldn't dare buy a house that would put me in that position. Heck, my house even cost less than his.
It is a GREAT idea to take a 30 year, to give you the flexibility of paying a lower note should something catastrophic happen to you. Given the fact that you focus on paying down the principle. Taking the 30 year is the best thing you can do.
They need a 60 year option for the original poster!
I definitely agree with you in that this OP, no matter how frugal he is, is getting in way over his head - like I said, we wouldn't do this and we make a lot more money than he does. When it comes to household maintenance, and "oh crap" repairs, you can't be frugal.
However, I can tell you why we chose a 30 year mortgage - the lower payments are a safety net. We can always double payments when we can, and if we need extra cash, do regular payments.
First of all I think you and UCF are comparing W-2 income to the OP's self employment income. They are not apples to apples.
Secondly, contrary to what UCF is posting, this guy's business may be growing yearly or even booming. YES, even in a recession. Not all business are experiencing a downturn.
Paying off a mortgage early, or faster than the amortization might be good for you. That doesn't mean it is the best for all. You guys should keep the blanket assumptions under wrap.
Lastly, the OPs scenario IS NOT what got us into this current mess.
First of all I think you and UCF are comparing W-2 income to the OP's self employment income. They are not apples to apples.
Secondly, contrary to what UCF is posting, this guy's business may be growing yearly or even booming. YES, even in a recession. Not all business are experiencing a downturn.
Paying off a mortgage early, or faster than the amortization might be good for you. That doesn't mean it is the best for all. You guys should keep the blanket assumptions under wrap.
Lastly, the OPs scenario IS NOT what got us into this current mess.
Yes, it is what got us into this mess. People buying homes they could not afford and then walking away from them. Millions of people. A whole bunch of GREED from buyers, banks, real estate agents, brokers, etc.
Also, the OP said they averaged 87k the last 2 years. Thats what I'm going off of. I don't care if he wants to take a 30 year loan out... my problem with him is his logic. He plain and simple does not make enough money to be able to afford that house. Period. He will find a bank to give him the money but that doesn't mean he can afford the house. People like him is EXACTLY what put us in the position we are in now.
There is a HUGE difference in getting files approved through underwriting when comparing:
an established person with A+ credit, plenty of money for a down payment, with substantial reserves
VS.
a first time homebuyer with minimal job history, with minimal money, with modest or bruised credit trying to get a minimum down government backed FHA loan.
Whats your point? I'm more established than this guy, put a ton of money down to avoid PMI, my loan was much less than his, and it still took 60 days from start to finish on mine. Lets both be honest here.. it can take anywhere from 15-60 days.
The OP has a 41% DTI and is on the edge with the amount of loan he is going after. It certainly can take a while.
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