*disclaimer: Not all individuals will qualify for each loan type and/or scenario. Please contact me to see if you'd qualify for these loan products and/or discuss your options.
Many people believe that if they make loads of money each year that, that is the only thing needed in order to determine how much they can borrow on their home loan. Depending on how you look at it, this can either be a really good thing, or a slightly less good thing. I'll explain:
Let's say a borrower brings home $200,000 a year. That's a lot of money right? Would the borrower be in correct understanding that they would be able to qualify for a hefty loan because they make a lot of money? Maybe! What if this same borrower is required to pay thousands of dollars in student loans per month, has extremely high monthly payments on multiple cars, and a credit score that is low?
Although this borrower brings home a lot of money, they'd likely have a high debt to income percentage. Because of a high DTI and a low credit score, there's a good chance that this borrower wouldn't be able to qualify for a lot of money from the bank.
Now let's look at another situation. What if a borrower brings home $90,000 a year, is actively paying down a low student loan amount, and has one reasonable monthly payment on a car loan that they're also working towards paying off. What if they also have another car that is completely payed off, and they've also got a high credit score.
There is a good chance that this borrower will qualify for a higher loan amount because they've shown that they are responsible with money, and are actively paying off their current debts.
There are plenty of factors that loan officers look at when it comes to qualifying a borrower to be lent a specific amount of money.
Contact me today to see how much you'd qualify for! I'd love to help you set, and reach your goals when it comes to buying or refinancing your home!
*disclaimer: Not all individuals will qualify for each loan type and/or scenario. Please contact me to see if you'd qualify for these loan products and/or discuss your options.
Brayden Ramsay NMLS #1997195
Momentum Loans NMLS #1606597
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