Mortgage understanders, help me with FHA knowledge

[colleyvillesooner]

What are the pros and cons?

We don't have a huge down payment (<8%) saved as of now. Choose to pay off credit card debt instead, which will be almost $0 Jan 1.

Good credit score, debt to credit ratio (when calculated with both incomes) is >20%.

Would like to get into a house before the baby in February, and found a good Realtor, but just wanted to get the low down on these loans and the downsides. (mortgage insurance etc).

We also need a new car, but realize not to buy that before the house.

TIA

[pergdaddy]

I believe there is more stringent criteria to be met with an FHA loan such as with the inspections and stuff.

I would think that having no credit card debt will be a good thing as long as you have had a history of paying them. History is good as it shows your ability to handle the debt. As long as you are under 80% loan to value, your chances of getting a good mortgage payment and getting a mortgage are real good. PMI kicks in I think over 80% unless you find a good bank. I am not paying it and I have a high loan to value, because of prior debt.

Good luck. I hope you can make it into your home. I would try to get approved for a loan before you find a house. Maybe get an idea of what you can spend. Just don't go house poor. We are fighting through it (me and my wife), but within the next 5 years it will all break loose and we will be in great shape.

Life is one big sacrifice, but the payoff is in the end when you have raised a family and can look back and say you did everything you could to provide for that life.

[colleyvillesooner]

yeah, we have no plans to be house rich, cash poor. Just looking for a starter house well under what we will qualify for.

Credit cards were always paid on time, with no dings on the credit.

[stoops the eternal pimp]

Our first house was FHA...depends on the inspector what all they will really expect...Didn't have to pay much upfront which is what we had to do when we purchased it...pmi wasn't that much either(but annoying to pay), and you can have that taken off after you have paid off 20% of what the house is worth...

It worked out great for us.

btw..they were reallly into the debt to income ratio.

Also, I don't know what your significant other's plans are after the baby, but we went off only what I would be approved for and didn't include my wife's income. We knew she wouldn't be working for a while, so I didn't want the pressure of trying to pay something I couldn't afford..and I m glad we did, because she never went back to work

[colleyvillesooner]

Our first house was FHA...depends on the inspector what all they will really expect...Didn't have to pay much upfront which is what we had to do when we purchased it...pmi wasn't that much either(but annoying to pay), and you can have that taken off after you have paid off 20% of what the house is worth...

It worked out great for us.

btw..they were reallly into the debt to income ratio.

Also, I don't know what your significant other's plans are after the baby, but we went off only what I would be approved for and didn't include my wife's income. We knew she wouldn't be working for a while, so I didn't want the pressure of trying to pay something I couldn't afford..and I m glad we did, because she never went back to work

Thanks for the tips. That is in our planning for sure.