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Do my wife and I qualify for a FHA loan?

My wife and I are in our early 40s and want to buy a home. We would be first time home buyers in the state of MN. We have excellent credit (north of 700 each), with no blemishes on our credit records. Our debts are a single credit card with a balance of $6,600 (which we are currently paying down at a rate of $2,400/yr.) and two low interest student loans, mine which has a balance of $11K and my wife's which has a balance of $25K. We just finished paying off $30k in credit card debt from my wife's shoulder and hip replacement surgeries and are starting to build up our down payment savings again. We currently have $8k saved up to put towards a home purchase (will be closer to $12K by summer 2013 when we hope to buy). Our annual gross household income is $130k and both of us have worked at our current jobs for 6 years. We have set a max home purchase price of $250k. We could wait a few more years to save up a 10%-20% down, but we were hoping to buy a home next summer to take advantage of the buyers market. We don't know if we qualify for a FHA loan due to our income (someone told us we earn too much to qualify).Advice is appreciated! by godzil_860_972 from Savage, Minnesota. Nov 14th 2012 Reply


Steven Brand (steve@yourfavoritemortgageguy.com)
#5 ranked lender in Minnesota - 65 contributions

You may qualify but if you'll have 5% to put down.. you may be able to qualify for a conventioanl loan and that should be MUCH better payment than an FHA loan (if you get the right Mortgage Insurance). Correct in that USDA has income limits but Conventional and FHA don't. Researching all the different types of Mortgage Insurance is one of your first steps and I can lead you in the right direction until next spring so you're prepared to get into the best loan for YOU. Steve at iLoan.

Nov 14th 2012
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Barb Lanis (BarbLanis)
#3 ranked lender in Illinois - 564 contributions

Awesome! You seem ready to go on a purchase. There are no income limits on an FHA loan! The down payment on an FHA is only 3.5%. Good credit, income, is also required but you seem to already have this in place! Take advantage now of the buyer's market! I am also able to lend in Minnesota. Please feel free to contact me barb.lanis@1amllc.com

Nov 14th 2012
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Bert Carpenter (BertCarpenter)
#3 ranked lender in Arizona - 1,731 contributions

Based on the information you have provided, it appears you qualify right now. FHA loans do not have income limits, but they do have county limits, but the lowest limit in MN is $271,050, so that should not be an issue for you. FHA only requires a 3.5% down payment. All loans require Mortgage insurance unless you are putting 20% down. People prefer not having mortgage insurance, but one of the things you need to keep in mind is that while you are waiting to save up enough to avoid mortgage insurance both house prices and interest rates are likely to rise. You should connect with a local Mortgage Banker/Broker, rather than one of the big banks or national mortgage factories. Unlike a bank employee, who is most likely just an order taker, a Mortgage Broker/Banker is Trained, Tested and Licensed in all aspects of Mortgage Origination. We have access to loan products of many lenders, not just those of one bank, and can properly guide you. But more importantly, we are trained to take a look at the various different options available to you and guide you into the one that makes the best sense for your situation. A Mortgage Banker/Broker can work with you to help you determine if it is better for you to use conventional financing or to consider FHA for your particular situation. You can find well qualified Loan Originators at the National Association of Mortgage Professionals at https://www.namb.org/assnfe/SearchBroker.asp. Don't forget to check out your selected Mortgage Originator at the National Mortgage Licensing System at www.NMLSConsumerAccess.org ~ Bert Carpenter, The LoansA2z team of NOVA Home Loans ~ NMLS 40586 ~ www.LoansA2z.com ~ 888-889-9950

Nov 14th 2012
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William J Acres (William_Acres)
#1 ranked lender in Arizona - 4,595 contributions

FHA does not have a maximum income requirement.. There is a maximum loan amount, but not a maximum income... based on what you listed, you should have no problem getting approved.. if you have more than 5% down, you might be better off going conventional financing vs. FHA, but with the $8K you have saved now, you can go out today and purchase a home.. I'm a Broker here in Scottsdale AZ and I only lend in Arizona. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. 480-287-5714 WilliamAcres.com

Nov 14th 2012
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Joel Lobb (kentuckyloan)
#4 ranked lender in Kentucky - 187 contributions

I think you should be able to find a FHA lender in Minnesota to do the loan sceario. Good Luck!

Nov 15th 2012
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Linda Wintersteen (Linda123)
#4 ranked lender in Arizona - 884 contributions

you were given wrong information on the income they , would ever you spoke with , were referring to the USDA , which is for low to medium income , and you have to income qualify, and yes, if you make too much for this loan, you will not get approvedFHA is qualified by income ande debts, and i would need to see what you pay each month per credit cards, etc, student loans, etc and if you want to go further, email me at yourloanpartnerforlife@live.com with your private email address linda

Nov 14th 2012
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Joe Metzler (JoeMetzler)
#1 ranked lender in Minnesota - 2,343 contributions

Based on the information presented, it would appear you would be approved for an FHA 3.5% down loan TODAY. You next step is to apply with a local lender, and let them professionally review your exact situation. I am based in St Paul. You can call me at 651-552-3681 or check out my web site at www.MnBestRates.com

Nov 15th 2012
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Phil Dumouchel (PhilDu)
#1 ranked lender in South Carolina - 1,370 contributions

You seem to be pretty much ready to qualify for a mortgage right now, with the possible exception of having enough of a downpayment saved up for a home price of $250K. As others have said there is no income limit for FHA and the required downpayment is 3.5% of the purchase price, you can negotiate for the seller to pay all or most of your closing costs (typical for many FHA loans). If I handle your loan I would also evaluate whether a conventional loan was a better option for you. The rate is a bit higher but the PMI cost is much lower, and it is possible to put as little as 3% downpayment. Qualifying is a bit more difficult but very do-able.Personally I recommend you move forward as soon as you are ready, interest rates are not guaranteed to stay this low - news reports about the FED keeping rates low for a long time doesn't necessarily translate into mortgage rates. Plus with home prices starting to increase soon is the best time to get started. Congratulations on taking the right steps toward getting ready to buy. I'd be happy to talk you through some options if you wish.

Nov 15th 2012
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Derick Condron (salemmortgageguy)
#2 ranked lender in Oregon - 154 contributions

With rates today you are probably going to want to look at a conventional mortgage with 5% down. FHA has increased their mortgage insurance premiums and they are not as great as they used to be so for someone like yourself that has great income and credit you will probably get a better deal with a conventional mortgage. FHA has no income limits sounds more like you looking at USDA Rural which does have income limits.

Nov 15th 2012
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