PLANNING FOR A HOME PURCHASE
If you are preparing to purchase a home, your first step is to pre-qualify for a mortgage.
This will enable you to determine what you can afford to buy and programs and rates for which you are eligible.
Lenders will grade you on three things:
1) Your ability to pay – lenders calculate your debt ratio by dividing your total monthly expenses for housing, revolving credit and installment loan credit by your gross monthly earnings. 35-45% is a normal range but exceptions are made for borrowers with compensating factors such as a high credit score, large down payment, low debt to income ratio and ample liquid reserves.
2) Your willingness to pay – This is determined by your credit score. Innovative Mortgage Services can perform a complete credit analysis and use professional techniques to raise your credit scores immediately as well as advise you on other short and long term techniques to boost your credit score even more.
3) Property Value – The rate you earn depends in part on the loan to value ratio (LTV) which is simply your loan amount divided by the value of the property. Loan to value ratios exceeding 80% require either mortgage insurance or a second mortgage. Innovative Mortgage Services can assist you by providing a predetermination of value by a licensed appraiser before your property is appraised. This is no guarantee of value, but an estimate based on comparable sales as there are many unknown quantities associated with the subject property.
We can assist you with finding various financing options for your scenario and provide assistance in structuring your purchase offer to provide maximum benefit including lowest rates and lowest closing costs.
Generally, borrowers with credit scores below 700 are better suited to FHA financing which also allows a minimum of 3.5% down payment and debt to income ratios over 50%.
Beginning in 2015, Conventional borrowers are eligible with as little as 3% down. Feel free to call Joe Bell, mortgage broker, anytime at 727-527-1454. We specialize in Tampa - St. Petersburg - Clearwater - Sarasota area and licensed to lend anywhere in the state of Florida.