Your Questions About Mortgage

Lisa asks…

Why doesent claiming mortgage interest add to my return?

I am filling out both H&R blocks and Turbo Tax’s online taxes and I noticed that the return amount didnt go up with either one when I add the amount of mortgage interest I paid this year. Why is that? Also, why is HR blocks return higher with the same exact information?

admin answers:

If you are single, you must have more than $5350 in itemized deductions to see a difference.

If Turbotax and Taxcut gave you different answers, I’d say it’s operator error. The companies word their questions differently and it’s easy to answer yes on one and no on the other….

Chris asks…

How does a mortgage short sell work, and how will it effect my credit?

I’m tryin to sell my house in Michigan. We have had it up for sales for 2 months, and had only one showing. We can’t lower our asking price any lower then it currently is without having to come to closing with money. (that I don’t have) Since our realtor already lowered his commission he suggested talking to our mortgage company about a short sale. What is your opinion?

admin answers:

With a short sale, you are selling your home for less than the balance due on the mortgage. This way you are still paying back some of what you owe to the mortgage company and avoiding foreclosure and subsequently bankruptcy. You need to make sure the lender will agree to the short sale and will not hold you responsible for the deficiency balance. Get any agreements you make with them in writing. Good luck!

James asks…

How likely is it that my mortgage company will pull our credit again?

We were pre-approved for a mortgage, and we submitted the application for the FHA loan already. Our mortgage broker said that we’d need to have some receipts on outstanding payments we owe, and we’ve gotten those to provide to him. Now, how likely is it that he’ll pull our credit scored again?

admin answers:

Not all companies pull credit again. I have worked for 3 Mortgage companies & not one has ever done that. Brokers probably do because every company they try to broker your loan through will pull it. Don’t make any new large purchases or open any new accounts & you will be fine.

Steven asks…

How can a mortgage company do a valuation on a property thats not built?

I am purchasing a flat and am just waiting to find out if i can get the mortgage. The Halifax have said they need to do a property survey first but the property isn’t yet built! it’s half way there but not completed.

admin answers:

They will be able to assess the important things such as number of rooms, location and risk factors without it being fully built. My dad had a similar thing a few years ago when he was going to buy a new build flat. He couldn’t get a good rate on it from anyone because it was being built with a wooden structure above commerical premises, one of which had a kitchen in it, which made it far too big a risk factor and eventually he didn’t buy it as it would have meant finding an extra £30,000 for the deposit!

Donna asks…

Is it possible to get a mortgage for a house if I am unemployed?

Let me be specific: I have 130,000$ cash, but am unemployed. I received this money as an inheritance. I intend to buy a house with several floors and tenants. Is a mortgage possible in my case? My intention is to at first keep payments going for the mortgage through the revenue generated by the tenants. This will give me the time to get a new job. Would a bank accept this case despite my being unemployed?

admin answers:

What you are looking for is called a “No Doc” loan. Under “no doc” you will not be asked to provide income/employment info. The basis for approval on this type of mortgage is your good credit and substantial down payment. Since you will be providing little evidence that you can repay the loan, the loan is considered a higher risk. You should expect to pay a higher rate and put a larger down payment than normally expected, to offset this risk for the lender.

Since you didn’t mention prices in your area, it is difficult to get an idea of how far the $130,000 cash will take you. Lenders look closely at LTV (Loan to Value = loan amount divided by lesser of value or purchase price) ratio. This is essentially your equity position. The lower your LTV, the lesser the perceived risk to the lender. Your LTV and credit score will determine if you qualify for a mortgage and at what rate.

Find an experienced mortgage broker in your area that has a expertise with many lenders. Let him/her know up-front that you are looking for a “no doc” loan and that you have a substantial down payment.

You mentioned that you are looking for a large house. Keep in mind that the typical mortgage broker only deals with 1-4 unit dwellings. So if you are looking for 5+ units, this will be considered an apartment and you will do best to contact the commercial lending department of your local bank or credit union for assistance.

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