Why can I not get a loan?

[ncounty4]

I appreciate the comments, leucadiarenter. The problem is not that we still own a house…we haven’t even gotten that far in discussions with the banks. The problem is that 90% jumbo loans with PMI just don’t exist anymore, period. We haven’t even gotten far enough to disclose any of that information (sorry to burst your bubble DWACP). Nobody is carrying those mortgage products right now…which was exactly the issue I outlined in my OP.

[NewtoSanDiego]

I find it hard to believe that a couple making $250K a year can’t even save enough for 20% down payment on a 700-800K house.

Save up for minimum 20%, or better yet save until you qualify for a true conforming loan, whose rates are around 5% now.

Prices will likely drop anyway so time is on your side.

You need to take a hard look at your budget. You “young” wippersnappers have never seen a recession, right? This is shaping out to be the mother of all recessions.

Also are both of you employed in stable, recession proof industries? Do you have 6month to 1 year of emergency funds in case of layoff?

I’m willing to bet that you waste, ahem “spend” alot of money

[NewtoSanDiego]

I find it hard to believe that a couple making $250K a year can’t even save enough for 20% down payment on a 700-800K house.

Save up for minimum 20%, or better yet save until you qualify for a true conforming loan, whose rates are around 5% now.

Prices will likely drop anyway so time is on your side.

You need to take a hard look at your budget. You “young” wippersnappers have never seen a recession, right? This is shaping out to be the mother of all recessions.

Also are both of you employed in stable, recession proof industries? Do you have 6month to 1 year of emergency funds in case of layoff?

I’m willing to bet that you waste, ahem “spend” alot of money

[NewtoSanDiego]

I find it hard to believe that a couple making $250K a year can’t even save enough for 20% down payment on a 700-800K house.

Save up for minimum 20%, or better yet save until you qualify for a true conforming loan, whose rates are around 5% now.

Prices will likely drop anyway so time is on your side.

You need to take a hard look at your budget. You “young” wippersnappers have never seen a recession, right? This is shaping out to be the mother of all recessions.

Also are both of you employed in stable, recession proof industries? Do you have 6month to 1 year of emergency funds in case of layoff?

I’m willing to bet that you waste, ahem “spend” alot of money

[NewtoSanDiego]

I find it hard to believe that a couple making $250K a year can’t even save enough for 20% down payment on a 700-800K house.

Save up for minimum 20%, or better yet save until you qualify for a true conforming loan, whose rates are around 5% now.

Prices will likely drop anyway so time is on your side.

You need to take a hard look at your budget. You “young” wippersnappers have never seen a recession, right? This is shaping out to be the mother of all recessions.

Also are both of you employed in stable, recession proof industries? Do you have 6month to 1 year of emergency funds in case of layoff?

I’m willing to bet that you waste, ahem “spend” alot of money

[NewtoSanDiego]

I find it hard to believe that a couple making $250K a year can’t even save enough for 20% down payment on a 700-800K house.

Save up for minimum 20%, or better yet save until you qualify for a true conforming loan, whose rates are around 5% now.

Prices will likely drop anyway so time is on your side.

You need to take a hard look at your budget. You “young” wippersnappers have never seen a recession, right? This is shaping out to be the mother of all recessions.

Also are both of you employed in stable, recession proof industries? Do you have 6month to 1 year of emergency funds in case of layoff?

I’m willing to bet that you waste, ahem “spend” alot of money

[XBoxBoy]

[quote=ncounty4]No, we don’t think that renting is a wise financial choice in our tax bracket.[/quote]

Actually ncounty4, I suggest you reconsider that. Compare these two case: 1) you buy an 800k property now, 2) you rent an equivalent property for two years, then buy.

In the first case, you will receive a tax deduction worth about 1/3rd or what you pay in interest on your loan. Depending on your interest rate, and the exact amount of your loan, I figure that deduction will be worth about 15k per year, or 30k for two years. ($720k loan times 6% interest times 34% tax bracket = $14688)

In case 2 you get savings because rents in that price range are significantly lower than your mortgage payments. (I’m gonna guess a thousand and a half to a couple thousand a month savings) But here’s the kicker. How much value will that $800k house lose over the next two years. If that house looses even 30k then the tax advantage does not outweigh the loss. And chance are high that an 800k house will lose more than 30k in the next two years.

Consequently, I don’t believe that you should tell yourself that because of your tax bracket renting doesn’t make sense. Quite the contrary, I think that regardless of your tax bracket, buying an 800k house today doesn’t make financial sense.

Just my two cents though, feel free to ignore me.

XBoxBoy

[XBoxBoy]

[quote=ncounty4]No, we don’t think that renting is a wise financial choice in our tax bracket.[/quote]

Actually ncounty4, I suggest you reconsider that. Compare these two case: 1) you buy an 800k property now, 2) you rent an equivalent property for two years, then buy.

In the first case, you will receive a tax deduction worth about 1/3rd or what you pay in interest on your loan. Depending on your interest rate, and the exact amount of your loan, I figure that deduction will be worth about 15k per year, or 30k for two years. ($720k loan times 6% interest times 34% tax bracket = $14688)

In case 2 you get savings because rents in that price range are significantly lower than your mortgage payments. (I’m gonna guess a thousand and a half to a couple thousand a month savings) But here’s the kicker. How much value will that $800k house lose over the next two years. If that house looses even 30k then the tax advantage does not outweigh the loss. And chance are high that an 800k house will lose more than 30k in the next two years.

Consequently, I don’t believe that you should tell yourself that because of your tax bracket renting doesn’t make sense. Quite the contrary, I think that regardless of your tax bracket, buying an 800k house today doesn’t make financial sense.

Just my two cents though, feel free to ignore me.

XBoxBoy

[XBoxBoy]

[quote=ncounty4]No, we don’t think that renting is a wise financial choice in our tax bracket.[/quote]

Actually ncounty4, I suggest you reconsider that. Compare these two case: 1) you buy an 800k property now, 2) you rent an equivalent property for two years, then buy.

In the first case, you will receive a tax deduction worth about 1/3rd or what you pay in interest on your loan. Depending on your interest rate, and the exact amount of your loan, I figure that deduction will be worth about 15k per year, or 30k for two years. ($720k loan times 6% interest times 34% tax bracket = $14688)

In case 2 you get savings because rents in that price range are significantly lower than your mortgage payments. (I’m gonna guess a thousand and a half to a couple thousand a month savings) But here’s the kicker. How much value will that $800k house lose over the next two years. If that house looses even 30k then the tax advantage does not outweigh the loss. And chance are high that an 800k house will lose more than 30k in the next two years.

Consequently, I don’t believe that you should tell yourself that because of your tax bracket renting doesn’t make sense. Quite the contrary, I think that regardless of your tax bracket, buying an 800k house today doesn’t make financial sense.

Just my two cents though, feel free to ignore me.

XBoxBoy

[XBoxBoy]

[quote=ncounty4]No, we don’t think that renting is a wise financial choice in our tax bracket.[/quote]

Actually ncounty4, I suggest you reconsider that. Compare these two case: 1) you buy an 800k property now, 2) you rent an equivalent property for two years, then buy.

In the first case, you will receive a tax deduction worth about 1/3rd or what you pay in interest on your loan. Depending on your interest rate, and the exact amount of your loan, I figure that deduction will be worth about 15k per year, or 30k for two years. ($720k loan times 6% interest times 34% tax bracket = $14688)

In case 2 you get savings because rents in that price range are significantly lower than your mortgage payments. (I’m gonna guess a thousand and a half to a couple thousand a month savings) But here’s the kicker. How much value will that $800k house lose over the next two years. If that house looses even 30k then the tax advantage does not outweigh the loss. And chance are high that an 800k house will lose more than 30k in the next two years.

Consequently, I don’t believe that you should tell yourself that because of your tax bracket renting doesn’t make sense. Quite the contrary, I think that regardless of your tax bracket, buying an 800k house today doesn’t make financial sense.

Just my two cents though, feel free to ignore me.

XBoxBoy

[XBoxBoy]

[quote=ncounty4]No, we don’t think that renting is a wise financial choice in our tax bracket.[/quote]

Actually ncounty4, I suggest you reconsider that. Compare these two case: 1) you buy an 800k property now, 2) you rent an equivalent property for two years, then buy.

In the first case, you will receive a tax deduction worth about 1/3rd or what you pay in interest on your loan. Depending on your interest rate, and the exact amount of your loan, I figure that deduction will be worth about 15k per year, or 30k for two years. ($720k loan times 6% interest times 34% tax bracket = $14688)

In case 2 you get savings because rents in that price range are significantly lower than your mortgage payments. (I’m gonna guess a thousand and a half to a couple thousand a month savings) But here’s the kicker. How much value will that $800k house lose over the next two years. If that house looses even 30k then the tax advantage does not outweigh the loss. And chance are high that an 800k house will lose more than 30k in the next two years.

Consequently, I don’t believe that you should tell yourself that because of your tax bracket renting doesn’t make sense. Quite the contrary, I think that regardless of your tax bracket, buying an 800k house today doesn’t make financial sense.

Just my two cents though, feel free to ignore me.

XBoxBoy

[blahblahblah]

The problem is that 90% jumbo loans with PMI just don’t exist anymore, period. We haven’t even gotten far enough to disclose any of that information (sorry to burst your bubble DWACP). Nobody is carrying those mortgage products right now…which was exactly the issue I outlined in my OP.

If that’s true then North County is in trouble. ncounty4 sounds like a very high quality borrower and if they can’t get a loan then not many people will be able to. It will just be the move-up (or move-down) crowd buying. I’ll say it again ncounty4, renting for the next year or two may be the best option for your family. Good luck to you!

[blahblahblah]

The problem is that 90% jumbo loans with PMI just don’t exist anymore, period. We haven’t even gotten far enough to disclose any of that information (sorry to burst your bubble DWACP). Nobody is carrying those mortgage products right now…which was exactly the issue I outlined in my OP.

If that’s true then North County is in trouble. ncounty4 sounds like a very high quality borrower and if they can’t get a loan then not many people will be able to. It will just be the move-up (or move-down) crowd buying. I’ll say it again ncounty4, renting for the next year or two may be the best option for your family. Good luck to you!

[blahblahblah]

The problem is that 90% jumbo loans with PMI just don’t exist anymore, period. We haven’t even gotten far enough to disclose any of that information (sorry to burst your bubble DWACP). Nobody is carrying those mortgage products right now…which was exactly the issue I outlined in my OP.

If that’s true then North County is in trouble. ncounty4 sounds like a very high quality borrower and if they can’t get a loan then not many people will be able to. It will just be the move-up (or move-down) crowd buying. I’ll say it again ncounty4, renting for the next year or two may be the best option for your family. Good luck to you!

[blahblahblah]

The problem is that 90% jumbo loans with PMI just don’t exist anymore, period. We haven’t even gotten far enough to disclose any of that information (sorry to burst your bubble DWACP). Nobody is carrying those mortgage products right now…which was exactly the issue I outlined in my OP.

If that’s true then North County is in trouble. ncounty4 sounds like a very high quality borrower and if they can’t get a loan then not many people will be able to. It will just be the move-up (or move-down) crowd buying. I’ll say it again ncounty4, renting for the next year or two may be the best option for your family. Good luck to you!

[Author]

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