I'm looking to buy a home and received a pre-approval from BofA at 5.25% on $108,000. I already signed a contract at $108,000 on a home with seller concessions of $3240. Also did termite and house inspection with the house in very good condition, no issues at all. At this point I believe the appraisal should be a cake walk with the house in foreclosure and surrounding homes valued around $110K-$130K. By the way my credit score is 700.
My question is will I get a full approval on the loan because of my income? Mortgage payments (including principle, interest, PMI, taxes, home insurance, and HOA) is expected to be about $810/month. I have 3 credit card payment of $15/$15/$25 with a total $55/month. But my monthly gross income is only $2000/month. Is that ratio low enough for full approval?
Well, here's an update to the numbers I'm looking at:
Sale price: $108,000
Down payment: $3780
interest rate: 5.25% (at this time in March 2011, credit score was 645. Credit score now is 700, of which I hope we can get a better rate.)
estimated home insurance (from AAA): $450
Tax is: $960/year
Other debt (credit cards): $55/month (total is $600)