OK - I want a house built. What do I do now?
The first step is to see how much of a mortgage you can get and how much do you want to spend. The basic rule of thumb is that for every $100,000.00 you borrow your payment will be about $550.00 (at 5% interest rate)
You will need to talk to a mortgage broker or a local bank to see what you qualify for. We recommend several banks as well as several mortgage brokers. Your situation will decide which option is right for you. We can help you choose!
The amount of your mortgage is dependant on your debt to income ratio. (DTI) The banks like to see a 45% DTI. This means that 45% of your income can go towards paying debt. For example:
Let's say you make $600.00 a week (gross - before taxes)
The bank will treat that as $2600.00 a month (600week x 52 weeks a year/12months)
They will allow you to spend 45% of that on debt or $1170.00 a month.
Now you have to deduct any other debt from that number as well.
Credit Card Minimum Payment, Etc.
So if you have a car payment of $150.00 and no credit cards that will leave $1020.00 a month for a mortgage payment. That will give you about $180,000.00 worth of buying power. Of course, If there are 2 people in the house bringing income that number will double.
Give us a call and we will set up a meeting so that we can discuss your possibilities.
There are programs out there that can be used in special circumstances where the government will loan you the money and they offer rates as low as 1% for people in low income brackets. If you qualify fo one of these programs you can get $100,000.00 for about $320.00 a month.
What Credit Score Do I Need.
Most banks require a 640 credit score. However, some programs go as low as 620.
If your credit score is not quite there, there are credit repair programs that can help you fix your credit score in a relatively short amount of time. We can sho you what to do there as well.