Max qualification amount and PITI doesnt match

Home Forums Purchase Program Max qualification amount and PITI doesnt match

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  • #50438
    Tara585
    Member

    Ok. Im super stressed. When I was qualified I was given a maximum purchase price amount. Its low but I can work with it. I am told its totally incorrect beacause the amount of taxes in my area are super high. But I just read a previous post stating the amount on your qualification amount takes into consideration your area’s taxes and insurance amounts. I dont get this? How can my qualification letter be so wrong? Has this happen to anyone else?

    #50442
    Nelsont
    Member

    Because your situation is specific you need to ask your MC. But yes during your intake your MC will ask what area you are looking to buy in. The qualification amount is your piti which does indeed include principal interest taxes and insurance. Because taxes and insurance are unique to each house they estimate those values but the total amount is what you worry about. When you look at houses online you can will see the specific tax information and the insurance will not be exact until you buy the policy during toward the end of your contract phase. Do a search online and use the listing websites calculator to play around with the values and see what it would take to buy that house. Even if you are only approved for a max piti of $800 you may still be able to buy a $200k house.

    Out of curiosity who is telling you it’s incorrect? The only good reason for it to be incorrect is a miscalculation in your income or dti.

    #50445
    lgunter84
    Member

    @tara585 I’m currently dealing with an issue concerning my purchase price. The bank is saying I’m over on my DTI ratio and can’t afford the house. I know 4 others experiencing the same thing with the bank. The naca underwriter is trying to get it all figured out because according to our numbers, I’m actually under the DTI ratio of 41%. The bank won’t tell her why their calculations are coming up different than ours and the communication isn’t quick so I’ve been trying to get this figured out since July 19th. I guess they are saying my max piti was too high although the home I am under contract with is less than my piti. I could have been approved for a $1900 payment with NACA but I chose to stay lower so I’m not sure why the bank is saying I can’t afford my $1544 mortgage payment. Something is wrong with their calculations and there are others experiencing issues with the bank concerning PITI and DTI ratios. Even after being NACA qualified and being credit access approved, the bank is saying NACA was wrong.

    I personally think the bank is calculating a payment into my debts that I only have three payments left. It’s on my credit report but it’s not supposed to be counted as a debt because I have 10 payments or less. Hard getting this solved because we can’t communicate with the bank directly, naca underwriters have to help and they are busy and slow to respond, if at all.

    #50447
    Nelsont
    Member

    Dti is 40%…not 41. Max Piti is 31. Maybe this what the bank is confusing? Unfortunately you may have play by boas rules. If you have only 3 payments left can you just pay it off and maybe resolve the issue?

    #58865
    pratik
    Member

    Lets all be little more savvy with numbers. That will go long way not only for homeownership but financial planning as well. Happy to help with handholding/running the numbers! 🙂

    #58868
    Tara585
    Member

    @Nelsont the issue with what was incoreect was that I asked for a mortgage that was equal to what I paid in rent. The MC was calculating everything with that amount. When it went to UW they came up with an amount that was $60 less. Here in NY that makes a huge difference. Everyone was confused until it was discovered rhat my base rent was one number and the extra $60 was for cable and internet that was added to my rent. We dont have an option to pay the lesser amount so we were looking at it as being “rental amount”. UW saw differently. Everything was worked out. Not an issue anymore.

    @lgunter84
    I had some bills that were less than 10 payments more like 4 or 5. To avoid that mistake I went on and paid them off. It is making life so much easier.

    #58871

    Never pay too much attention to the max purchase price unless your buying in the 600ks or something. The max purchase price is an estimation based on the taxes for the area your looking to buy in and your income. I was told my max price was in the mid 300s , but I am actually buying in the mid 400s. Pay alot of attention to what your max mortgage amount is this is what matters!

    If you have access to the accurate taxes for your property, get the monthly amount. Get an estimation or a quote for the properties you are interested in and plug those numbers in, in a redfin calculator. The number you get should not exceed your max monthly mortgage amount. Otherwise you will have to buy down the IR/principal to lower the amount of the monthly mortgage and increase your purchasing power. The NACA mortgage estimator calculator will never be as accurate as you doing bit of homework on the taxes and insurance.Just remember that NACA is all about you being able to afford your monthly payments (PITI). Make sure that you are aware of the median income in your area on the FFIec website and make sure you are under 100% of the median income to avoid problems.

    Good luck

    #58878
    southflorida
    Member

    @Tara585 the amount that you got approved as a monthly payment, what’s the percentage of this amount compared to your gross monthly income?

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