1st time buyer

[mort newbie]

Buyer is 1st time.
owes credit cards 50000
dti : 80%
loan amt 250k
owner occupant
has some cash reserves of about 25k in IRA
fico 744
wish list:
SISA
no down/interest only
no closing cost
wants to asap incorporate the credit card debts into morg
wish to extract 10k out of IRA for renov

Anyone can suggest financing?
Thanks in advance

[GeorgeWBooth]

Try www.fantasylandmortgage.com

If they are still around, they can help you.

[mort newbie]

thanks GWB. tried the site but looks like they're gone. Any other suggestions?
thanks in advance.

[GeorgeWBooth]

I'm sorry newbie, I didn't mean to yank your chain like that but I got a nice chuckle out of your scenario.

Let me give you a little advice if I may before the rest of this board tears you to shreds.

1. 80% dti? you mean LTV I presume.
2. 50k in outstanding credit? Not gonna happen.
3. Your wish list.
a. sisa, maybe but not knowing the income, it's hard to determine.
b. no down / int only? Not gonna happen. Payment shock?
c. no closing costs? you must be joking. Are you originating for free?
second of all I can't issue a title policy for less than the STATE
mandates, that's illegal. he wants his escrow free? Title exam free?
survey free? Arm endorsement free? Not gonna happen.
d. Incorporate the debt into his mortgage.... all the while not putting
anything down. Where is the room here?
e. Retards drain their IRA for home improvements. Smart people use IRA
for retirement first, and emergencies second. not sure where home
improvement falls in line there.

So here is my last pearl for you. chances are you scored this lead and the guy already has a deal set up and he's yanking your chain to see if you can get him anything better. or..... The guy is a total ass and probably being older hence the 25k IRA he believes he can buy a house without putting anything down since he is a hell of a guy and has a nice credit score.
I have seen High School Seniors with 800+ credit scores, but I wouldn't give them 250k, especially if they ran up 50k in 20%+ interest debt.

Lastly, if your client is legit, you need to man up or woman up and take control of your client. being a first time home buyer, he is not entitled to make those kind of outrageous demands. Either give him the riot act and tell him how it's going to be, or fire the client and move on.

Working on this deal will only cost you time and money you could have closed two other deals on.

George

[Greg]

I will try not to tear you to shreds but the reality is in the above post.

How long have you been closing mortgages and in what state? What did you have to go through to get your license? Do you have any questions about the general mechanics of a loan or want some help determining what is important to ask when you are trying to place a loan?

You can close this loan though. You could go as far as using NO DOC.

You cannot use a home purchase loan to payoff debt. They must buy the home then look into doing a refinance using appraised value which is scary because they will not really have the equity. They could do a 115% or a 125% but those lenders will want 12 months ownership before using appraised value.

Your credit score is high enough to get the loan closed though. However, tell me about where the income comes from. If employed give me a 2 yr job history.

George is right it is not very smart to dip into retirement but it is doable and you do not have to pay the penalty as long as it is funds used to finance a home.

No Closing Costs... Well you could have the seller do a concession for 3% or less and have that put into the purchase contract so she does not pay the closing costs out of pocket. There is always closing costs on a loan but what you see on TV is a lender charging a higher rate to offset the amount of the closing costs the LENDER is paying for the borrower. You can do the same thing by charging a higher rate and doing a lender credit back to the borrower out of your yield spread...

But, what kind of money are you looking to make. You need to make something.

Also many lenders will require LIQUID assets. An IRA is not considered a liquid asset. You can use a bank account or a 401k. But, since you are seeking SISA you can just state the amount so you can do this deal.

You will need an ALT A program or Sub-Prime. There are several who will do it.