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Personal Finances / Buying or Selling a Home


Subject:  Re: Mortgage Date:  9/29/2019  11:31 AM
Author:  aj485 Number:  129256 of 129281

Does this mean that if someone has available assets that are more than the mortgage that they are qualified?

No. It means that if someone has $1MM in assets that are not being used to produce their income, in addition to their down payment and closing costs, they have monthly income of (.7 x 1,000,000)/360 = $1,944 towards the mortgage, in addition to any other income that they have, like SS or a pension.

Then, for a qualifying mortgage, up to 42% of your monthly income can be used for the mortgage, so, $1,944 x 42% is $816 At a rate of 4%, that $816 would allow you to qualify for a mortgage of about $171k, or a $213k house with 20% down.

If you have other monthly income, like SS, of $2k/month, that would bump the allowed mortgage payment up to $1656, which would qualify you for a mortgage of about $347k at 4% With 20% down, that would mean you could afford a $433k house.

What the underwriter wanted to see was confirmation that the broker was directed to distribute $X/mo to me, *and* to see a copy of the check or my checking account statement showing the deposit(s).

Yes, they still want to see that the broker/account administrator is sending you the money, and see that amount deposited into a checking account. It would depend on the lender if they would qualify you by just seeing an uncashed check - some lenders like to see at least 2 deposits into your account, so just showing one uncashed check wouldn't work.

Things were different & simpler on my refi last month.

How so? They look at the documented income on your last 2 tax returns to qualify you for a mortgage. I seem to recall that you have SS and are pulling money from your retirement accounts, in addition to getting dividends, interest and capital gains from taxable accounts. If that's the case, then you probably had enough income documented on your tax returns to qualify, and didn't need to show any additional income. If the income documented on your tax returns hadn't been enough to qualify you for the mortgage, then you may well have needed to set up an additional withdrawal from your retirement accounts.

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