4 comments. Current rating: (2 votes). Leave comments and/ or rate it.
A friend of mine bought a home in 2001 which since then appreciated by several $100k. In June 2005 she bought a new home and financed it at 100% with a 3-months fixed mortgage. Her idea was to sell the first place within these 3 months, then take the $350,000 equity from that sale to pay down the 100% financed home and refinance it as a 30 year fixed mortgage.
But things happened different.
In these 3 months the first home continued to appreciate (by another $40,000 or so) and my friend decided to keep it one more year - but now as a rental. Eventually she found a tenant paying enough rent to cover interest, property tax and insurance. At the same time my friend tried to buy a small investment property (for lenders: ‘vacation home'). The two previous properties are each valued in the $800k range, so the investment property for $160,000 should not pose a problem. Right?
With the mortgages on the 2 expensive homes totaling up to a debt of $1,300,000 and an annual income of only $100,000 (which in many parts of the world would be considered plenty) her debt-to-income ration was too high.
The rental income from the first house did not help as it was not established yet in credit reports nor did she have any bank statements to prove it (the renting family had not even moved in yet!).
She worked with a broker who pre-qualified her easily for a loan since the second home purchase had not shown up on her credit report yet. He also promised her great rates. However, then he could not deliver.
She switched the broker. The next one submitted her credit application to 12 different lenders and each of them plus the broker did pull her credit score. Having over a dozen of inquiries without any line of credit show up on your report significantly lowers your score. My friend's FICO credit score dropped within 3 weeks from a spotless 720 to a low 595!
What could she do?
As a first step, since she had never given the broker written permission to pull her credit - left alone have 12 lenders pull it - she requested that those inquiries be taken off her credit report.
The solution for the debt-to-income ration would be to sell property #1 and lock the mortgage for the other $800k house.
Obtaining financing for the little (out-of-state) $160,000 home is the lowest priority since it doesn't matter too much how good a rate she will get on that one.
Send a message to
www.creditrelease.com from United States
With the Bad Credit Market becoming more and more competitive with each passing day, the potential customer should have little problem finding very competitive rates and fees. Its just a matter or knowing your credit score and shopping around.
we can only deliver fresh cut cash backed lease bank instrument (BG/SBLC et al.) to you in accordance to our terms and condition. Our bank instruments can serves as collateral as the case may be, which will enable you get loans from your bank so as to embark on any projects such as Aviation, Agriculture, Petroleum, Mining, Telecommunication, Construction of Dams, Real estate, Bridges, Trading, Importing and exporting and Other Turnkey Project (s) etc.
Also these instruments can be put in PPP, etc. Please do let me know of your willingness to proceed and I will email you our terms and condition upon request.
We are international financier, trust Consultant of worldwide development prime lending's.We are Specialist of funds, loans, bank guarantees. We are working with large lending's affiliated to a corporate consortium group operators and providers of Bank Financial Instruments. Through this large lending's,Trade group consortium, we can arrange the following services as their trust consultant.Our lease rate is (5)%+x%. X% IS Lessee broker's Commission and he determines his commission.
Worldwide project financing, Loans,BG,SBLC,MTN,POF,LC,SKR Discounting,Project Funding,Letter of credit, and lots more for investors
If you are interested contact us immediately
For all inquires Contact: