[MIzzy]

...process? my husband and I are in the process of looking for our first home and I am really confused by the mortgage pre-approval process. We have a combined income of 85K and 80,000 saved for a down payment...despite all this we were only approved for a sales price of 330,000...I say only because when I do the math and figure out our monthly payments on a 30 year loan, the payments are less than $1000 per month which is less than what we are paying in rent and definitely less than what we can afford. Also, we live in a large city on the east coast and 330K doesn't buy you much....Also, I should mention that my husband has a credit score of over 800 and mine is 740...so we are both excellent candidates for a large loan. Am i misunderstanding the pre-approval? I think when my husband filled out the application he said we were interested in a home that is listed for 330...is it possible that we could be approved for a higher amount? or does the quote we got sound about right? Also, I am not sure I am calculating the monthly payments accurately. Basically, I am assuming an interest rate of about 4.8% on each month payment...or is calculated differently?We don't have any significant debt, about $10K in student loans...and most of the properties we are looking at are under what's called 'tax abatement' for 10 years which is a program the city instituted the invigorate up and coming neighborhoods.

[sassy2]

Your math is screwy. The interest alone on 330k is 1350 a month.Add in principle, property tax and home insurance your payment could be close to 3k a month.

[veets43]

i do believe that you would qualify for more, it really depends on your debt to income ratio (how many bills you have) with 80,000 down you would qualify for a $400,000 loan at 20% down and 80% financing...If I were your Mortgage broker I would have given you a lot more options, letting you know what your max purchase price and payment might be...