Why a Pre-Approval is Necessary!

We all love to look at houses that are for sale.  We may be in the market to purchase now or we may be in a future market but either way the first step is always to get Pre-Approved!

Did you know that Realtors will not accept any offer from a potential buyer without a Pre-Approval letter signed by a well known lender like myself?

In fact most Realtors are trained to not even show you a house until they know that you qualify.

Getting people qualified is my job!

Get Approved

Once you are Pre-Approved, I will issue a letter to your Realtor and only then will they start showing you homes, it’s just how they work!

Think about how important this actually is!  What if you qualify for a house of $150,000 but you are looking at houses for $200,000?  Even if you put an offer in at $180,000 and got it accepted, you would not get an approval for a loan–make sense?

Take just a moment and email me for a Quick Application.  I will let you know how much you qualify for–then you can start working with the Realtor.

Are you a Veteran?  CLICK HERE

Are you a Native American?  CLICK HERE

All others CLICK HERE

 

 

 

 

 

 

Veterans Housing Dreams Fulfilled Here!

Many years ago the real estate industry coined the phrase “The American Dream” when encouraging families to own their own home.

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VA Loan Specialist Make dream possible!

Today, that dream is still alive.  Low interest rates and steady home prices have helped people who have rented most of their lives to step forward and become proud homeowners.

Sometime during WWII, the US Government noticed that while many families did indeed become homeowners, It was difficult for Veterans to do the same.   Welcome to the VA Loan!

Now more than ever, Veterans can leave their landlords behind to accept the keys to their own home.

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Get your keys right here!

The VA Loan still has a zero down payment, lower monthly payments due to no MIP and you can purchase in any desired location with no income limits or special qualifying.

The VA Loan is our passion!  It brings great satisfaction to us every time we assist a family achieve their dreams.

GET MORE INFORMATION HERE or simply email Todd at todd.mcmanigal@amecinc.org

UNM Area Townhouse

This spacious UNM area townhouse is perfect for the student wanting to be close to the UNM Law or Medical schools

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Very quiet location with great freeway access.  This house is close to everything!

For a showing please comment below or call Todd 918-1028.

 

Native American Dreams fulfilled here!

Many years ago the real estate industry coined the phrase “The American Dream” when encouraging families to own their own home.

1 Buyer Couple (1)

SEC 184 made our dreams possible!

Today, that dream is still alive.  Low interest rates and steady home prices have helped people who have rented most of their lives to step forward and become proud homeowners.

In 1992, the US Government noticed that while many families did indeed become homeowners, Native Americans as a whole did not. Welcome to the SEC 184 Loan!

Now more than ever, Native Americans can leave their landlords behind to accept the keys to their own home.

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Get your keys right here!

SEC 184 has a low down payment, lower monthly payments and you can purchase anywhere in Colorado, New Mexico and other states.

SEC 184 is our passion!  It brings great satisfaction to us every time we assist a family achieve their dreams.

GET MORE INFORMATION HERE or simply email Todd at                tmcmanigal@houseloan.com

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How Much Are You Eligible For with your VA Loan?

Basic Allowance for Housing, or BAH, is paid monthly to eligible service members when government housing isn’t available. Lenders can count BAH as effective income and use it to help calculate how much a borrower can spend on housing each month.

The amount a veteran receives for BAH is based on rank, years of service, dependent status and location.

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In general, service members with higher ranks and more years of service receive more money each month for BAH, though there are exceptions. Rates also tend to be higher in major metropolitan areas or regions with higher costs of living.

BAH rates are set annually. If you decide to spend less on housing than your eligible rate, you can use the difference for other expenses. However, if your housing costs exceed the predetermined BAH rate, you’ll need to make up the difference yourself.

GET PRE-APPROVED FREE!

 

 

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American Mortgage & Equity Consultants, Inc.  NMLS # 150953

Todd McManigal   505-918-1028   or 303-378-1272                               NMLS # 267557

todd.mcmanigal@amecinc.org

Explaining the VA’s Standard for Residual Income

Despite the fact that the majority of VA loans are completed with zero down payment, they continue to be one of the safest lending program available today.

One reason for this success is a unique income standard that aims to ensure veterans can handle the financial burden of a new mortgage payment.

This standard is called residual income.

Monthly Leftovers

Residual income applies only to VA loans.

Basically, residual income is how much money you have left over each month after all of your major expenses are paid. Those leftovers cover typical family needs like gas, food, clothing and utilities.

The VA wants to know that veterans have enough residual income to comfortably run the household financially.  A mortgage payment can put a significant strain on family finances. So prospective VA home buyers must have a minimum amount of residual income depending on where they live and how many people live in the home.

Here’s a look at the VA’s residual income break down:

Table of Residual Incomes by Region

For loan amounts of $80,000 and above

Family Size Northeast Midwest South West

1

$450

$441

$441

$491

2

$755

$738

$738

$823

3

$909

$889

$889

$990

4

   $1,025

   $1,003

   $1,003

   $1,117

5

  $1062

   $1,039

   $1,039

   $1,158

over 5

Add $80 for each additional member up to a family of seven

So, as an example, a Colorado family of four must have at least $1,117 in residual income each month. The standards are higher on the coasts, where the cost of living is typically more expensive.

Additionally, if a family’s debt-to-income ratio is above 41% the residual income requirement increases by 20%.  So for the same Colorado family of four, if the DTI ratio is 42% the residual income requirement would increase to $1,340.

Failing to meet the residual income standard isn’t supposed to result in automatic rejection of a loan application, but it can certainly be a deal breaker. This is a non-negotiable requirement.

How to Count Overtime Income Towards a VA Home Loan

Income isn’t everything when it comes to getting a VA home loan, but it’s a pretty important factor. Obviously, you have to be able to afford the monthly mortgage payments and have enough money left over each month to take care of regular expenses (better known as residual income).

Lenders will want to make sure the money you’re bringing home is stable, reliable and likely to continue. Otherwise, banks and lending institutions won’t count it as “effective income,” meaning it won’t actually count toward mortgage qualification. For example, disability income, child support income, basic allowance for housing (BAH) and overtime can all be counted.

How income is counted may vary due to the type of income reported. Certain sources like child support and overtime are acceptable, but VA borrowers will often need a paper trail documenting their history and must prove the income stream will continue.

Let’s take a closer look at overtime income and what you’ll need in order to have it count toward qualifying for a VA home loan.

Overtime Income

For lenders, it’s about consistency and stability. There are typically two major concerns when it comes to overtime income:

  • Is the borrower guaranteed, required or allowed to work those extra hours?
  • Has the borrower shown an ability to work all those extra hours?

You may wonder why a lender may want to know if you have the ability to work the extra hours, but it’s vitally important.  Lenders want to make sure you can handle the additional workload.  Not everyone is cut out for 60-hour workweeks, leading some to burnout in time.  If this happens, workers tend to ask for and receive less overtime which may make it difficult to make the monthly mortgage payments.

So how do you ease a lender’s mind and get them to count your overtime income? Generally, you’ll need at least a two-year history of receiving that income to make it work, even if your employer confirms the overtime is guaranteed.  Of course, there are some exceptions that can vary by the individual borrower.

Overtime Exceptions

As in life, there are exceptions to most every rule.  For example, let’s say you’re close to having 24 consecutive months of overtime, maybe 20 months.  Underwriting  may be able to calculate your average overtime over the last two years and use the figure, which obviously will be less than what you would have if it was a full 24 months.

People who work a lot of hours but have irregular schedules from one week to the next can also be eligible before the two-year mark. Firefighters and nurses are  good examples . If you work 88 hours one week and then have the next week off, that’s 44 hours in a pay period. In these cases, a VA borrower may be able to count their overtime income with just a year’s worth of tax returns.  Underwriting may consider other factors to offer a final decision on the loan.

Overtime can be tricky.  If you don’t have a 24-month history of overtime with a single employer. but you’re working overtime consistently at both, a lender may be able to count it as long as the income is likely to continue.  Again this is a case by case scenario and Underwriting may consider other factors before offering a final decision on the loan.

As with so many employment issues, each borrower’s situation is different. Lenders will hasten to make broad generalizations because everyone’s employment circumstances are so unique.

If you’re unsure how your employment or overtime situation stacks up, talk with a VA Loan Pro specialist at 505-918-1028. They can let you know what might be possible.

 GET PRE-APPROVED FREE!

 

 

Email Logo           Equal Opp Lender Logo

American Mortgage & Equity Consultants, Inc.  NMLS # 150953

Todd McManigal   505-918-1028   or 303-378-1272                               NMLS # 267557

todd.mcmanigal@amecinc.org