October 31, 2018 at 10:02 am #46003
I was qualified on Friday 10/28 at the Chicago Achieve the Dream event (soooo worth the 11 hr drive) While at the event both the MC, Underwriting and the Agent conducting the home purchase workshop said to focus on the monthly max PITI amount because those amounts will determine whether or not the home is affordable or if additional interest rate buydown is needed.
I received the property specific letter and then an email from the new MC that I was assigned to at the event saying that I need $10k in buydown. I ran numbers manually, through the naca site and even through other online mortgage calculators and I have NO CLUE where he is getting his numbers from. @TTrumble PLEASE HELP. I am trying to put an offer in on a home but cant without this property specific letter.
Monthly Approved PITI $1225
Listed Asking Price $219,000
Offer $209,000 + $7500 in closing cost for interest rate buy down
Counter Offer $212,500 + $7500 in closing cost
Annual Taxes $800
Monthly Insurance $66.00 (its an add on to my car so I save)
Current NACA site interest Rate is 4.375%
$7500 interest rate buy down $212,500 * 1%=2125 =3.125%
MONTHLY MORTGAGE PAYMENT $1044
WHAT AM I MISSING?!?October 31, 2018 at 11:42 am #46004
@MzSheaD when I calculate your numbers — $7500 affords you 3.5 points. $7500/2125 = 3.52 (round down = 3.5).
Each point decreases your interest rate by .25%.
Each half point decreases your interest rate by .125%.
3.5 points = a 0.875% decrease in interest, so your new interest rate would be 3.5%
I input all of your numbers into the calculator or mortgagecalculator.org:
Loan amount: 212,500
Down payment: $0
Interest rate: 3.5%
Loan Terms: 30 years
Property Tax: $800
Home Insurance: $792/per year
It gave me a monthly mortgage of $1479.80. If you put down another $10,000, you could purchase another 4.50 points, which would further decrease your interest rate by 1.125, resulting in a 2.375% interest rate. That would drop your mortgage down to $1298.62. So a little over $10,000 would be needed to stay within your maximum PITI of
$1225. Hope this helps!
November 1, 2018 at 10:30 am #46023pratikMember
- This reply was modified 2 years, 12 months ago by JHarris981.
@JHarris981, there seems to be a mistake in your monthly mortgage calculation. $212,500 property at 4.375% gives monthly PI of $1061 and add insurance and taxes and that will add ~$136, making a mortgage (PITI) of $1198. With the $7500 buydown (~3.53 points), the interest rate will go down to ~3.493% and the monthly PITI will be $1090. No need to put down another 10000. @MzSheaD, your MC goofed up. Don’t worry about whatever s/he says. Just ask him to submit the bank application :-D. Good luck!November 1, 2018 at 10:43 am #46024
Here are my numbers:
– Loan amount:$212,500
– Each interest point costs $$2,125 and with $7,500 you can but 3.5 points which would decrease the interest by 0.875 resulting in a decrease in the interest from 4.375% to 3.5%
– If I put in a mortgage calculator $212,500 in a 30 years loan with an interest of 3.5% I get a monthly payment of $954
– Insurance is $66
– Taxes is $67 (800/12)
Below would be the monthly payment:
67 Taxes (rounded up)
I agree with @Pratik, we are only off by $3
@MzSheaD Don’t take NO for an answerNovember 1, 2018 at 12:11 pm #46028
Thank you @pratik and @southflorida he did in fact miscalculate 🙂 I made sure to run the numbers in all calculators possible before I even looked at homes. I didnt want to fall in love with something that I couldnt afford. He just kept insisting on the max purchase amount not the monthly amount, but I was able to get it resolved yesterday afternoon thanks to the AMAZING Shawn Cunningham. I am officially under contract. Inspection is scheduled for tomorrow at 3pm.November 1, 2018 at 12:55 pm #46029
OH WOW, That’s great! how many days for closing in the contract?November 1, 2018 at 1:09 pm #46031
@southflorida its written for 45 days. Closing date set for December 10th but it was a rental that had been on the market for over 3 months so the seller is quite patient and nice.November 1, 2018 at 2:39 pm #46034
Oh ok, great, I hope things expedite for you, good luckNovember 1, 2018 at 3:45 pm #46040
thank you @southflorida im just glad to see some movement. ANY action is great at this point.November 1, 2018 at 3:50 pm #46041TTrumbleMember
How cool that you got it resolved before I even could look at it! Shawn is truly an amazing guy, and not just where NACA is concerned. We are incredibly fortunate to have him here!
I’m also very grateful for all the input that @southflorida and @pratik have shared. I’m sure everyone has guessed that I’ve been swamped with the Achieve the Dream events the past few months, and I am extremely grateful to both for their help in keeping things on track. I know the forum has been in great hands. You guys rock!
With the tour schedule for 2018 winding down (only Philadelphia left) I’ll be able to invest more time here going forward (at least until after the holidays)
@MzSheaD please make sure to keep us updated on how things are going.
Online Operations, NACA
November 1, 2018 at 4:26 pm #46049
- This reply was modified 2 years, 11 months ago by TTrumble.
Yes I love me some Shawn! He’s hilarious. I saw you at the Chicago event Mr. Trumble. I was there Friday right before you guys shut down for the evening and I was there volunteering on Saturday. I was the last clap of the night on Friday the 28th.November 1, 2018 at 8:20 pm #46058
Has anyone heard of the transaction summary sheet form?November 1, 2018 at 8:22 pm #46059
@MzSheaD my apologies!! I had all your figures and had calculated your interest rate down correctly, but I think I input the wrong loan amount when I typed it in the calculator. I did get $1087. Glad that all worked out for you. Your file is moving along quickly now!November 1, 2018 at 8:52 pm #46061
No apologies needed @jharris981 I appreciate you helping. Attending the ATD was the best decision that I have made so far during this process.November 1, 2018 at 9:13 pm #46063
@MzSheaD thanks! I love math. Took Calculus in college just for the heck of it, so I definitely don’t want to give anyone wrong figures. 🙂 For some reason I input that the sale price for you home was $300,000. Maybe I was thinking of my dream home. lol I’m glad things are looking up for you!
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