Does This Sound Doable? My Only Hope (O/O SFR purchase)
I have to buy a house.
FICO is 625, but only due to utilization (65%). No derogatories. Cc debt is $15K.
Soon to be ex and I have agreed to sell our house. The only encumbrance is a $45K HELOC.
My realtor sent comps over yesterday; we are in a strong seller’s market. The suggested listing price is $297,400. I am basing my thoughts on a conservative prospective sale price of $280K.
The plan is to pay off the ccs with the cash from the sale. I expect my FICO to bounce right back up in 30 days or so, yes? Our escrows are typically 45 days.
One huge problem is income. Due to a neuropathic disorder, I was down for the past three years. I literally *just* started an online teaching job as a 1099 IC. I also get a small soc sec check ($720).
Yesterday, I got even more bad news. Apparently, though my student loans ($382K) are current and on income based repayment; the lender has to use 1% of the fully amortized amount to calculate DTI.
So much for ever buying another house again in this lifetime.
After having a lot of doors slammed in my face, a local lender proposed the following scenario:
Use $125K from the sale as a DP on a $175K house and finance $50K.
Is this possible? Math is definitely not my jam.
Questions:
Wouldn’t the lack of two years of income still be a problem?
What about the student loan issue?
What kind of interest rate would be likely?
Thank you!