Would a home lender approve a 35% front-end ratio for a mortgage loan in California?

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This topic contains 3 replies, has 3 voices, and was last updated by  Anonymous 8 years, 1 month ago.

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  • #418176

    Anonymous

    Of course there are still ways to get a mortgage loan.

    Anyone with reasonably good credit, buying a reasonably priced property, and with enough income to cover the mortgage will be able to get a mortgage.

    I would never recommend a balloon mortgage to anyone. Things change. What if you don’t want to sell before the balloon payment is due? What if you can’t refinance before the balloon payment is due? (This is the problem a lot of people in trouble are facing today – they can’t refinance a mortgage that they can’t afford.) What are you going to do then?

    If you can’t afford a 30 year fixed at a good market rate, then you can’t afford the house. keep looking for something that you can afford.

  • #418177

    Anonymous

    I know it is old fashioned advice but it still works and is more appropriate in today’s world than ever.

    Try not to spend more than one fourth of your net income a month for housing. That’s either to buy or rent. Balloon mortgages will kill you. Stick with fixed rates. Whether it is a 20 or 30 year mortgage. I know some experts will tell you never to pay off your house. Just ask them if they have theirs paid off or not and see what they say.

    It may get tougher to get a loan although my first house they made it pretty tough then ( about 30 years ago) and the rate was higher. My first house was 8 and three quarters with 20 percent down. The second house was 8 and a quarter and I had 50 percent down.

    It may not seem fair but it is still an individuals responsibility to stay within your own income levels on loans. An older starter home you can keep is better than a big new house that breaks you and you are out in a year.

  • #200592

    Anonymous

    I would like to purchase a condo, and with my low income ($21k) I am wondering if a lender would approve my required 35% front-end ratio for a mortgage. The condo is $80k, and I will be making a down payment of around $18k-20k. My credit score is 760-777. I have ZERO debt. Would lenders see me as reliable enough to give me a $60k loan with a 35% front-end ratio?

  • #258394

    RichardFAf
    Member

    you should be able to get the loan.

    HOWEVER, you really CANNOT AFFORD THIS PLACE.

    with a low income of 21%, your total housing ratio should only be 20% MAX.

    You are setting yourself up for trouble.

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