All Forum Posts by: Stephanie Medellin

@Sam Haack  The qualification process is going to be the same for a cash out refinance as it is for a purchase.  Sometimes you can qualify with one year self employment if you're in the same line of work  - for example an attorney that was previously W2 and then switches to 1099 with the same firm.  Even this will require a full year of self employment reflected on tax returns.  Otherwise, most lenders will need 2 years of self employment before they will consider the income "stable."  If you have a co-borrower, or another type of income, that could work.

@Account Closed  As long as you made your April payment you should be fine.  It's even ok to incur a late fee for May, as long as you are closed and completely paid off before the end of the month.  Your credit history is only affected when your payment is 30 days late or more.  

@Todd Hoffman  Great post!

@Philip L.  If this is a conventional residential loan, yes that is odd.  I have never had anyone fill out an ACH form to set up monthly payments before the loan has closed (and the loan officer is generally not involved in loan servicing after the closing either).  There are some lenders (banks or credit unions) that give a discounted rate on certain portfolio loans for auto-withdrawal.  It may make sense in that case, otherwise no.

@Account Closed  If you're planning to skip the May payment, I would not even schedule it for the 10th and then cancel - just hold off on scheduling it.  Most mortgages won't incur a late fee until the 15th (check your statement).

Keep in mind you're never actually skipping any interest when you skip a payment.  You are still paying interest for every day that balance in outstanding, it's just rolled into the loan.  You'll pay 23-24 days of interest (to cover the rest of May) in your closing costs, and your July payment covers June's interest.

Your loan payoff for your current mortgage will include interest to May 7th, plus a few days.  If you skip the May payment, since the May payment is actually covering April's interest,  you will just pay that interest through the loan payoff.  If you make the May payment, it will lower your payoff amount.

@Juan Chavez  We can go to 89.9% on larger loan sizes - this could potentially work if your home value is $620,000 or higher.   

@Paul Defngin has the right answer here.  It's 100% legitimate to buy a home for elderly parents who cannot qualify on their own and have it be considered a primary residence.  If you and your brother talked about that with your loan officer, it's very possible the loan was underwritten that way.  Going forward, you can buy your own primary residence, as long as you qualify for both payments.  If your brother makes 100% of the payments, you would need to show proof of him paying the loan for 12 months to exclude the payment.  

A "second home" is a vacation home, or 2nd residence away from your primary residence.  It should not be confused with the second home you purchase, which could be either a new primary residence, a vacation home, or a rental property.  

@Brian M. How you report rental income and expenses on your taxes will have the most impact on your debt to income ratio. Even if the monthly rent covers the mortgage payment, taxes, and insurance (and HOA dues, if applicable), if you're writing off lots of repairs, management fees, advertising expenses, utilities, and more, those additional expenses will reduce the rental income and usually will end up hurting your debt to income ratio.

In the beginning, and in the first year of ownership before anything is reported on your taxes, lenders will use 75% of the lease amount as rental income.  As long as that amount covers the payment, it will not hurt your debt to income ratio.   

@Account Closed  It's really no trouble at all to change from a 15 to a 30 year, and you do not need to start the process over.  Your payment will be lower, so there shouldn't be any question about whether you'll qualify.  All your lender needs to do is change the loan term in their system, adjust your interest rate lock to reflect the 30 year interest rate (which will almost certainly be higher or cost more to keep the same rate), and issue a new loan estimate to you with the new rate / payment /terms.  

@Jeff S.  I know this is an old thread, but did anyone try to trace where the money for the fraudulent purchase went?  It had to go to a bank account somewhere?