Real Estate - Mortgage Prequalification, Finance Basics

Bob and Jackie came to your bank seeking an FHA mortgage. They
want to know how large a mortgage they would be qualified for and
what the terms would be. Bob is a pastry chef ($45,000/yr. gross)
and Jackie is a software programmer ($60,000/yr. gross). They
currently pay $300/mo. on student loans // have a $225/mo. car
payment with 5 years remaining // Pay $250/mo. on credit card debt
// and $180.mo. for utilities
Their credit rating is 640 and they have $8,000 in savings.

Bank requirements for FHA loans:
? Mortgage/Total debt ratio use 29/50 for this project - (Duane 26/36)
? 1 ¾% loan origination fee
? 1 ¼% mortgage insurance
? 4% interest rate
? 30 year amortized loan

Questions:
1. How large a loan can they qualify for?
2. For that size FHA loan, what will their down payment be?
3. What will their origination fee be?
4. What will their monthly payments be?
5. What documents will you need from Bob and Jackie?
6. What ACTS govern the disclosures that will you need to make to Bob and
Jackie?
7. What documents will you need to obtain regarding the property?
Posted Date: 12/5/2012 1:14:08 PM | Location :







Related Discussions:- Real Estate - Mortgage Prequalification, Assignment Help, Ask Question on Real Estate - Mortgage Prequalification, Get Answer, Expert's Help, Real Estate - Mortgage Prequalification Discussions

Write discussion on Real Estate - Mortgage Prequalification
Your posts are moderated
Related Questions
Which depreciation method would produce the higher NPV and how much higher would it be?

Definition of Stock Exchange According to Pyle: "Stock Exchange are market places where securities which have been listed thereon, may be bought and sold for either investme


Interest Rate Levels and Stock Prices Interest rates contain two effects on corporate profits: a) Since interest rate is a cost, and like the higher the rate of interest the

Bills of Exchange Bills of Exchange are a source of finance in specifically in the export trade. A bill of swapping is an unconditional arrange in writing addressed via one pe

1-Suppose you deposit $ 5 000 in the bank. How much can you raise after 10 years when discount rate is 5% for the first four years and then rises to 7% annually? 2 -A used car co

Profitability Ratio These ratios signify the performance of the firm in relation to its capability to derive returns or profit from investment or from sale of goods that is pr

Financial Instruments in Money Market or Discount Markets Financial Instruments in Money market involve as: 1. Commercial paper 2. Bills of exchange 3. Treasury bills

Define and explain the credit multplier

Business Activity Cycle The interest rates also depend on business cycles as above. Because the economy moves in the four (4) business cycles, such interest rates will shift l