So what does that mean for first time home buyers or any home buyer for that matter? It means that mortgage loan rates are coming down. It means that if you are looking for a home in Sonoma county, from Petaluma to Healdsburg , to purchase that you can now effectively either buy more home or pay less for it. It is going to be your Choice!
When looking at your purchase loan transaction, the lender is going to look at your total income vs your total housing payment. This is known in the biz as a DTI ratio or Debt to Income ratio. The debt includes your Principle and Interest payment plus your Insurance and property Tax payment computed on a monthly basis (PITI). This divided by your gross income is going to be your front end ratio. When you add all of your other debts together which might include but not be limited to your car payment, school loans, credit cards and alimony or child support , add that to your PITI and devide the total by your income you get a back end ratio. Typically lenders would like to see front end ratios in the high 20’s to low 30’s % and a back end ratio should not really exceed 45% . If rates come down then your overall cost (PITI) is lower and there for you will be able to either buy a more expensive home or your real este mortgage loan payment will be less.
If this all seems really complicated, it is. That is why it is important to work with a local lender that really knows his loan programs. If you are buying property in Sonoma county you should use a lender that is an expert in sonoma county real estate mortgage loans. And that is where I come in. I have been around the block so to speak, 28 years as a real estate broker, and my many satisfied customers will vouch for the excellent service I provide. I really don’t believe that an online lending institution can handle your local needs nearly as well as I can. I can help you decide just how much debt you are comfortable with.
For a free consultation please contact me, Hunt Conrad, at hunt.conrad@prospectmtg,com
If you would like to try out a FREE service called the Home Buyers scouting report which gives you access to your local MLS follow this link
http://www.greatrealestate.com/SearchRealestate.aspx?ID=7A803C6EAFFB4338AA8542A6D62
