Credit Card Debt and Obtaining Financing - Posted by Phyllis

Real Estate Investing Real Estate Financing
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Posted by Bruce Lawson on July 06, 2002 at 16:57:04:

Hi Phyllis,

When you complete an application the lender will ask for bank statements for the past year they want to see how you spend your money, your savings looks good but is not a deciding element in the equation.

Debt to Income now is a different animal the lender will take this into the mortgage equation, the lender will allow you a D/I ratio of 36% for all your debt they will permit 28% for a mortgage. If you have excessive credit card debt that will take you over 36% you will be required to pay that debt off or down to a level within their paremeters.

If you have a large savings with a large amount of debt the lender may suggest you use that to pay off the debt.

Sincerely,

Bruce Lawson

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Credit Card Debt and Obtaining Financing - Posted by Phyllis

Posted by Phyllis on July 06, 2002 at 15:22:56:

Hello,
I’m really excited to find this web site. My husband and I have been studying real estate investments and are ready to make some offers. I’ve often heard contradictory information about which is better on a mortgage application, high savings and debt (about equal), or low savings with little to no debt. Any opinions? Thanks.

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Re: Credit Card Debt and Obtaining Financing - Posted by Mike Mulcahy

Posted by Mike Mulcahy on July 06, 2002 at 20:14:17:

Or you could get a no-doc, or low doc loan to minimize scrutiny of your DTI.