Before applying for a mortgage which is better - positive a downpayment or paying rotten credit card debt?
I'm going to go apply for a mortgage for my first house. My credit is good, however i've have more credit card debt than I'm comfortable with due to purchases for a business I'm starting. I also have some money surrounded by savings and my question is what to do beside this money: I want to pay off my credit card debt, but consequently i wont have a house downpayment. So which is the better option: should I apply for the mortgage near my current revolving debt level and savings to be used as a downpayment, or should I pay packet off my credit card debt then apply?
Answers:
get rid of your debt, your interest rate may be lower
I suggest you try to get debt-free first and afterwards start saving for your down payment. This holds honest for those who have piled up a lot of cc debts because you don't know whether you'll be capable of pay for the mortgage along with greatly of other debts. So, the best thing is to pay sour at least the high interest rate credit card debts and next try to save while paying off the low interest rate cards. Also, back you apply for a mortgage, check out the 11 affordability factors at http://www.mortgagefit.com/checkout-your… so that you know for sure that you'll be able to deal with a mortgage.
Thanks,
Jessica,
Mortgage mentor
MortgageFit Community
Okay, it sounds close to you may not be ready to purchase. With the new mortgage regs. you cannot bring back 100% financing on a home any more- so you have to have the down payment/closing costs etc. Also if you are newly now starting a new business you may not qualify anyway- we require 2 years import tax returns on self employed people & if you haven't had this business for 2 years you won't own verifiable income. As for the credit card debt, if you are uncomfortable with it consequently chances are you are high on the dti- debt to income ratio. Mortgage lenders examine your final 2 years- credit, income, & stability (job)- very closely.
Good luck! Source(s): 22 years mortgage business
hi... it'd be better if u pay of your credit card debt past applying for a mortgage for your house. that's because your creditors can administer their lien on your property (both present and future) if by any chance u r unable to pay envelope off your debt.... and a clean status as far as credit card bill will also furnish you better credibility as far as banks go....i.e. if u r planning to apply for mortgage to a Bank...
I can describe u this coz I am working in the credit cell of a bank.
Related Questions:
Should an eviction suit be on my credit report as a mortgage story?
i'm a bit confused. 2 years ago, i was sued for eviction/non payment of rent but approved not to go to my court date to plead my side, so it was an automatic judgement for my landlord/property mgmt company and i...
Answers:
get rid of your debt, your interest rate may be lower
I suggest you try to get debt-free first and afterwards start saving for your down payment. This holds honest for those who have piled up a lot of cc debts because you don't know whether you'll be capable of pay for the mortgage along with greatly of other debts. So, the best thing is to pay sour at least the high interest rate credit card debts and next try to save while paying off the low interest rate cards. Also, back you apply for a mortgage, check out the 11 affordability factors at http://www.mortgagefit.com/checkout-your… so that you know for sure that you'll be able to deal with a mortgage.
Thanks,
Jessica,
Mortgage mentor
MortgageFit Community
Okay, it sounds close to you may not be ready to purchase. With the new mortgage regs. you cannot bring back 100% financing on a home any more- so you have to have the down payment/closing costs etc. Also if you are newly now starting a new business you may not qualify anyway- we require 2 years import tax returns on self employed people & if you haven't had this business for 2 years you won't own verifiable income. As for the credit card debt, if you are uncomfortable with it consequently chances are you are high on the dti- debt to income ratio. Mortgage lenders examine your final 2 years- credit, income, & stability (job)- very closely.
Good luck! Source(s): 22 years mortgage business
hi... it'd be better if u pay of your credit card debt past applying for a mortgage for your house. that's because your creditors can administer their lien on your property (both present and future) if by any chance u r unable to pay envelope off your debt.... and a clean status as far as credit card bill will also furnish you better credibility as far as banks go....i.e. if u r planning to apply for mortgage to a Bank...
I can describe u this coz I am working in the credit cell of a bank.
Related Questions:
Should an eviction suit be on my credit report as a mortgage story?
i'm a bit confused. 2 years ago, i was sued for eviction/non payment of rent but approved not to go to my court date to plead my side, so it was an automatic judgement for my landlord/property mgmt company and i...