Will my FHA loan get approved?
It has not yet gone to the underwriter but I was pre-qualified and have already sent in the application. My credit score is 813 but I don't have much that I have financed through my life. Will that affect it? I think the biggest thing I have ever financed was a $ 1200 furniture payment. The monthly payment of the loan on the house would be half of my monthly income; however I have no other debt. Credit cards have no balance, no car payment, etc. Pretty much all I have is a cell phone bill, car insurance and utilities at this point. I am renting an appartment now and when the lady sending in my application asked me what the rent payment was I said $800; however I didn't tell her that it was split with my room mate. So really I have been paying $400 a month. The monthly payment on my loan would be $1165 with insurance, taxes, pmi ect. Also our apartment went into foreclosure and we have not been paying rent for about a year now - we are not witholding it we just don't have anyone to pay at the moment. So really I only have a renting history of about 4 months. I also did not share this information when applying. Is this something they will find out and ask me?
After putting down the money for the downpayment and closing costs I will have about $5,000 left in my bank for emergencies. I do not have any other assets other than this.
Also when I said that the monthly payments were have of my income that was before taxes and insurance out of my paycheck. So the paystubs I showed them were about $440 a month.
Will this loan get approved?
Sorry, I meant a 440 a week.
Thank you everyone for your answers - that is what I anticipated the answers were. I do have renters which is the only reason I was considering it but then I started wondering why they would even approve that not knowing that information. So thank you all for the information. :)
I emailed the lady that sent in my application asking her about this and this is what she said...
I already have you preliminary pre approved with a DTI ratio of 44.57%.....Based on good credit and additional down payment you can go higher than 41%....don’t worry…...
- Glenn SLv 79 years agoBest Answer
Sorry, but no way. You are not even close. Whoever pre-qualified you doesn't have a clue about FHA guidelines. Do not give this person any money. He is either a scammer or a complete idiot.
If the house payment is over 29% of your monthly income (front end ratio) you will not get the loan or if the house payment and all of your other debt payments are over 41% of your monthly income (back-end ratio) you will not get the loan.
With your current income the maximum payment that you could qualify for is about $525 a month PITI.Source(s): http://www.fha.com/debt_to_income_ratios.cfm
- lightupthesky25Lv 59 years ago
There's no way you will be approved for any loan where the loan payment is half of your income. The max debt ratio most lenders will give you is about 36-41%, which includes the loan payment and any other debt such as credit cards, auto loans, etc. They'll also be looking for a front-end ratio (loan payment plus taxes interest and insurance) of about 30%. With a loan payment of 50% - not going to happen.
In order to qualify for this loan, you need to make more money. So either look for a cheaper house or a better paying job.
Just FYI, the lender will not care about your rental history at all. Rental history has nothing to do with your credit unless a landlord filed a judgement against you that ended up on your credit report. So no worries about withholding that information.
- Simpson G.Lv 79 years ago
Um, your apartment going into foreclosure is not a reason to stop paying rent. You continue paying it to your landlord until the new owner contacts you.
If the bank contacts the owner of the apartments and they show that you are 1 year behind in your rent payments, that's probably going to shut down any chance of getting a loan.
If the monthly mortgage payment will be 50% of your income, you will not be approved. Rule of thumb is that you can afford about 3 times your annual salary, assuming no major outstanding debt.
- ?Lv 44 years ago
the property has to meet certain standards in order to use an FHA loan
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- David14Lv 79 years ago
Not psychic, but with $440 a month in income I doubt it.
- ?Lv 79 years ago
Failure to pay rent is going to haunt you. When the lender looks at your bank statements they will be asking how you are paying rent.
- 4 years ago
if I apply for new credit cards before closing