Post # 1
Saw the question about down payments on a house and got me thinking is there a minimum that banks look at in order to approve you for a mortgage? Or do any bees have any input on their situation or anything? Not asking for specifics per say and I know it depends on what part of the country you live it but I am currently a stay at home mom going to school with a 3 month old and my so is providing for us and we are saving for a house while living with family. (Think what you want but it’s working for our situation temporarily) that said one income is difficult to begin with I realize. Just wondering if it’s possible for us.
Post # 2
- Wedding: September 2015 - Hotel Ballroom
Canadian Bee here! I live in Southern Ontario area. Darling Husband and I were approved by the bank for our first morgage with him making about $33k a year and me making about $28k. I will note we were approved for a morgage of $350k, but were only looking for about $150-$200k. This was in the 2015 housing market.
EDIT: I forgot about credit score. I was still carrying some student debt at the time, but my credit score was ‘good’. Darling Husband was carrying some credit card debt and his credit score was ‘average’.
Post # 3
It depends on how much of a mortgage you want, not necessarily how much you make. IIRC banks want to see that <25% of your gross income is allocated to a mortgage payment, and they also want to see that you have savings to cover a down payment that correlates to the type of loan you’re getting (conventional, FHA, etc.). Your mortgage rate and monthly payments will vary according to your credit history.
Post # 4
If you told us your SO’s income that would help us to give you some more information. They will take your savings and credit score into account.
You said SO so I assume you’re not married. I would advise you to get married before getting a mortgage together.
Post # 5
This totally depends on your individual circumstances — factors like your credit score, if you have any debt or if you are debt free, if you do have debt, what is your debt to asset ratio, how much you have as a down payment, how much you are looking to finance, and how stable your SO’s job is. I wouldn’t say it’s by any means impossible on only one income, it just depends on your total situation. My advice would be to look at your finances, figure out how much total you can afford/would like to spend on housing (mortgage, homeowners insurance, mortgage insurance depending on your down payment, taxes, utilities, and a misc contigency for all the things that always come up when you own a home), and work backwards to see if you feel you can afford it (and how much), and THEN approach a mortgage officer. They will almost always preapprove you for more than you can actually comfortably afford, so it’s good to know your limits first. Good luck bee!
Post # 6
debt to income ratio (DTI) is the most important number when buying a house. If you made a high salary but also had car and student loans or credit card debt you may not qualify for as much as someone with a lower income but zero debt. I bought our house before Darling Husband and I were married but for giggles we both asked our bank what they would approve us for individually (buying together before marriage was never an option in my mind but I was making a point to him about how important it was to kill his loans) and although we made very similar salaries I was approved for double what he was because he still had a car loan and a student loan and I did not.
Post # 7
it’s totally doable on one income… I purchased my first house by myself (house was $350k and I was earning $45k/yr and had saved 75k over the previous many years of working). The more you have saved, the less risk you will be, so save what you can. The best advice I got was to live like you already had a mortgage to see if you could do it… so my repayments were $450/wk, so on top of rent, I put the extra aside to make sure I could do it easily.
I’m in Australia so it’s a little different with some things… I talked to a few brokers before I was ready to commit, but it really was the best thing I did.
Post # 8
When we bought our house, my husband had really variable income and shifted jobs a lot, so we just purchased the house using my income. It was no problem at all. What matters is consistency of income, credit score, debt-to-income ratio.
The I found is that what we qualified for, I would never in a hundred years feel comfortable actually paying. So IMO just because you get approved for $X amount doesn’t mean it might be a good idea to max it out.
I’d talk to a mortgage broker and see what they say based on your situation.
Post # 9
I bought the Home Buying Kit for Dummies. It starts with how to determine if you’re ready to buy and then what to do to get your finances in order and figure out what you can afford. I’d highly recommend it!
We waited till we had 20% for a downpayment, but there are several kinds of loans out there, some of which you can qualify for with as little as 3% down. Of course, there’s more to it than that (many loans with less than 20% downpayment require private mortgage insurance…extra $!) so take your time and learn about your options to see what’s best for you!