9/10/2024 – Debt to Income Ratios Happy Tuesday! Debt-to-income ratios are one of the main factors when qualifying a buyer for a mortgage. When I started in the business, they used to tell us we could go to 28% on the front end (Principal, Interest, Taxes, and Insurance) and 36% on the back end (all other bills, credit cards, car payments, student loans, and personal loans). So, under this scenario, a person making $10,000 per month could qualify for a mortgage payment of $2800.00, assuming all your other debts were below $800. That was the standard Conventional Loan, and FHA was still about where we are today, which is why FHA was much more prevalent in those days. Fast Forward 34 years, and today, we have Debt-to-income ratios that are much higher but lower than what we saw leading up to the mortgage meltdown. Here are some examples of debt Ratios today: Conventional low and high balance – 50.49% / 50.49% – FHA – 46.99 -56.99 Jumbo – Some are 43% / 43% some go to 45%/45% Non QM – 50% / 50% VA – no disability – can go up to 50%/60%, assuming they have the necessary residual income VA – with disability – Can go to 70%/80%, assuming they have the necessary residual income Second Mortgages – 50% When buyers question why they are not approving based on their income, the formula is pretty simple. Some buyers are salaried, and you cannot do much there. We have to average the income of an hourly employee, and self-employed people can sometimes use one year of taxes and other times we have to use two years. There are a lot of little tricks we can use to help buyers qualify for more by paying debts or consolidating debts. You should not get a different answer, going from lender to lender, but you will! LOL! I am available all week if you need anything. Let me know if you have any questions or if someone is interested in buying a property! My cell is 661-714-6258, and my office line is 661-260-2970 ext. 2222. My direct line is 661-291-2222. When you text me, please text (661-714-6258) or email me at Mike@AugustaFinancial.com. But wait, there’s more! Interest rates are better again today. We are seeing 6’s and 5’s on most loans. Larger down payments are seeing some really sweet rates and 15-year mortgages, and some Government Loans are now seeing 4’s! 12-day escrows if your buyer is pre-approved - Conventional / FHA / Jumbo / Bridge We do loans in all states, so call me with anything you need. Government Loans (FHA / VA/ USDA) are in the low to mid 5’s Conventional Loans up to $766,550.00 are in the high 5’s to low 6’s High Balance Loans $766,550.01 – $ 1,149,825.00 are in the mid to high 6’s Jumbo loans above $1,149,625 are in the mid to high 6’s Bank statement loans - They are available with 10% down again! Starting in the mid-6’s. Profit and Loss Statement loans – 20% down – You don’t need bank statements, just a profit and loss statement! No income qualifier – 40% down with reserves! In the 8’s! 0 down loans are in the high 6’s – 620 credit score min right now, up to $1,191,000.00. Private Money lenders - Hard Money Loans – 35% down! No Ratio Loans 30% down DSCR – Debt Service Coverage loans with as little as 15% down Bridge Loans - typically 7.99% with limited fees – and they get you where you need to go! 3/2/1 Buydowns 2/1 Buydowns and 1/0 Buydowns are available at great start rates! Interest rates are subject to change without notice! The above are LA County Loan Limits. Dates to remember: We are having a Blood Drive for Children’s Hospital here at Augusta Financial from 9 am-3:15 pm on October 15th. I signed up at 9:30, so feel free to watch me cry and cringe! Click the link to sign up! Our annual Oktoberfest is October 24th from 5:30 pm -8:30 pm. Live music, great food, lots of drinks, and great company! Click the link below to RSVP Good news on Condos – down to 44! Rainbow Sierra Terrace – removed from Fannies list! Also, new insurance that works! YAY! Bad news – Condo Update? Briarcliff North Townhomes –7435 Shadyglade Ave #2, North Hollywood. Insurance deductible is $50K. Condo / Townhome – issues we know of now. Properties can be financed with 10% down and are considered NON-WARRANTABLE: American Beauty Condos - The brown ones - Insurance: 50 Million in coverage for 748 units is not nearly enough! American Beauty Gardens: 19% delinquency on special assessments due. 19% are 60 days or more late! We can do with 5% down, but others can’t! American Beauty Village West: On Fannie’s List. Per Fannie, this project needs critical repairs and may have conditions such as material deficiencies and significant deferred maintenance. This project’s master insurance policy deductible exceeds the allowable limit. Bella Ventana – $50,000 deductible per unit is naughty. Bouquet Canyon Village – $50K deductible per unit is naughty! Briarcliff North Townhomes –7435 Shadyglade Ave #2, North Hollywood. Insurance deductible is $50K. Briarcrest – 12720 Burbank Blvd Valley Village – Insurance and repairs Bridgewater, Emeryville - On Fannie’s list! Insufficient Insurance Brookside Walk – Insufficient Insurance Cabrini Villas, Burbank - On Fannie’s list! Insufficient Insurance Calla and Rowan – 27513 Illumination – Fannie Mae Approval expired – New Construction. See Blog on 5/7/2024 Cameo Woods HOA - Per the litigation disclosure, the association is being sued by a homeowner for water heater damage and discrimination, and the damage is still ongoing. We received confirmation that the HOA’s insurance agency is not covering the lawsuit, and the claim was denied due to the nature of the complaint. Canyon Village – Reserves and 10% of the dues not going to reserves! Canyon Oaks – Insurance On Fannie’s list! Casa Marabella – 13951 Sherman Way, Van Nuys -On Fannie’s list! Cassia and Jasmine – 26949 Winding Trail Court – Fannie Mae Approval Expired. See Blog on 5/7/2024 Cimmaron Oaks – Castaic – Insurance is too low! Cornerstone – Insurance -On Fannie’s list! Creekside – Insufficient insurance District Community Association – Northridge – Fannie Denied – Insufficient Insurance Encino Oaks – 5460 White Oak Ave – On Fannie’s list! Heather Ridge – Deductible too high! not enough insurance – Fannie Naughty List! Liberty Canyon HOA – 27409 Country Glen Road, Agoura Hills, CA- On Fannie’s list! Madison at Towne Center – Litigation – We can do with 5% down, but others can’t! Magnolia Manor – 12416 Magnolia – Lots of issues from insurance to repairs. Mariposa: On Fannies List. Per Fannie Mae – This project’s master insurance policy coverage does not meet the requirements. Market Street Community – Corona – No Wildfire coverage Mesa Vista North Townhomes – San Juan Capistrano – 50K deductible per unit is naughty! Orchid at Valencia – 27033 Open Sky Place – Fannie Mae Approval Expired. See Blog on 5/7/2024 Penn Court HOA – 4201 Pennsylvania Ave La Crescenta On Fannie’s list! Princessa Estates – insufficient reserves Scenic Hills – Insurance – On Fannie’s list! This project’s master insurance policy coverage does not meet the requirements in Selling Guide Sec. B7-3-03, Master Property Insurance Requirements for Project Developments. Shadow Ridge – Oak Park – Insurance -On Fannie’s list! Sherman Way Condos – 17900 Sherman Way Reseda – On Fannie’s list! Tyler Villas – Sylmar – Coverage is good, but non-warrantable for delinquencies The District Community Association – 19533 Cardigan Dr, Northridge – On Fannie’s list! Treana - Stevenson Ranch: On Fannie’s list! Per Fannie, this project needs critical repairs and may have conditions such as material deficiencies and significant deferred maintenance. Valle Di Oro is on Fannie’s list! Per Fannie Mae, this project contains timeshare, fractional, segmented, or split ownership units or other arrangements (such as mandatory rental pooling, shared interest apartments, or community apartments) restricting the unit owner’s ability to occupy the unit. Village Park Condo – It’s over the max deductible with that 50k per unit. Vista Del Canon – Insurance is too low, UGH! Walnut Gardens II – 7320 Lennox Ave Van Nuys CA – On Fannie’s list! Warner Center Condos – 5515 Canoga Ave, Woodland Hills, CA – On Fannie’s list! West Creek Condos and Townhomes: On Fannie’s List. Per Fannie, this project’s master insurance policy coverage does not meet the requirements in the Selling Guide! 13801 Hoyt Village LLC – 26 units and 14 are owned by one entity! Please let me know if you hear anything new on condos or townhouses. I am still available all week if you need anything. Let me know if you have any questions or if someone is interested in buying a property! My cell is 661-714-6258, and my office line is 661-260-2970 ext. 2222. My direct line is 661-291-2222. When you text me, please text (661-714-6258) or email me at Mike@AugustaFinancial.com. Have a great day and an even better tomorrow! Please call me when you have a client who needs to borrow! Mike Meena President | Loan Officer Click to Call or Text: (661) 714-6258 This entry has 0 replies Comments are closed.
