Finding a Mortgage BROKER?

[Selesai]

I am hoping to buy a house later this year after my ccs are paid off. It will be my and my husband's first home purchase. We both have good credit, though admittedly we don't know the details and should probably order credit reports an scores. But we (especially I) carry lots of student debt, about $150k total. I work, DH is a SAHD. I have been warned that mortgage companies don't always "properly" consider student debt (whatever that means) so my understanding is that I need to find a broker that will really look at my finances in detail rather than superficially.
How do I find one? How do I know which is a good one? I'm thinking I should start the preapproval process just so I know how much I can expect to borrow, though of course I have some general idea.
All advice is helpful, thanks!

ETA: I also wonder how they determine income. My income from last year, was much less than it will be this year, because I didn't start my current job until August.

[1growingsprout]

my experience has been student debt is part of your debt to income ratio. they will do employment verification which consists of your payroll history, last years taxes and information from your payroll dept. the mtg co will contact your HR dept directly for info.
they will also look at your bank stmts, brokerage stmts, credit reports etc.

i would first talk to the mortgage dept at your bank and go from there.

[KnittingShaker]

If you deal with a broker (which I would suggest over a bank, as brokers have access to many products that banks don't) tell them upfront that you have substantial student loan debt. Some lenders will count the estimated monthly debt in your debt ratio (even if the loans are in deferrment) some of them won't.

If you husband has no income and has debt on his own, you might want to think about applying for the loan by yourself. You might be in a better place ratio-wise and could possibly be in a better place rate-wise.

Good luck!

[cristeen]

To find a mortgage broker, I would highly recommend asking friends, acquaintances, etc. who they used, if they liked them, and WHY. Then call them up and "interview" them over the phone before you give them any of your personal info.

Ask what percentage of your income they "allow" to go towards your mortgage payment. Many companies now are saying 50% or more. And a lot of them will push you to use it. 50% of your income towards housing is ridiculous, and in most places it is recommended that the figure be only 33% (or lower).

Ask what lenders they use regularly, are they names you recognize, or obscure companies that you've never heard of?

Ask about First Time Homebuyer's programs. In most areas, you qualify if you haven't bought/owned a home within the last 10 years. They usually have better rates.

Ask what closing costs you should expect to come out of pocket for. If you don't already know, ask if it's a buyer pay or seller pay area. In some places, seller pays for certain closing costs related to a purchase, but in other areas, the buyer does. This will effect how much money you'll need to come out of pocket with.

If you're in an escrow state, ask what company handles the escrow, and how their rates/coverage compare to other companies.

Ask how your student loans are going to effect your ability to get a mortgage. This can relate back to the first question, of percentages. Honestly, you'd probably prefer that your student loans don't effect your mortgage, just be sure you do the math on your budget, to be sure you can afford both your student loan payment and your mortgage payment (taxes and insurance), don't trust your broker to do it for you.

I'm sure there are other questions to ask, those are off the top of my head. I wouldn't give any mortgage broker my personal information unless he/she could answer those questions to my satisfaction (and did so in a personable, friendly way, you don't need a jerk of a mortgage broker).

[KnittingShaker]

Originally Posted by cristeen

To find a mortgage broker, I would highly recommend asking friends, acquaintances, etc. who they used, if they liked them, and WHY. Then call them up and "interview" them over the phone before you give them any of your personal info.

Ask what percentage of your income they "allow" to go towards your mortgage payment. Many companies now are saying 50% or more. And a lot of them will push you to use it. 50% of your income towards housing is ridiculous, and in most places it is recommended that the figure be only 33% (or lower).

Ask what lenders they use regularly, are they names you recognize, or obscure companies that you've never heard of?

Ask about First Time Homebuyer's programs. In most areas, you qualify if you haven't bought/owned a home within the last 10 years. They usually have better rates.

Ask what closing costs you should expect to come out of pocket for. If you don't already know, ask if it's a buyer pay or seller pay area. In some places, seller pays for certain closing costs related to a purchase, but in other areas, the buyer does. This will effect how much money you'll need to come out of pocket with.

If you're in an escrow state, ask what company handles the escrow, and how their rates/coverage compare to other companies.

Ask how your student loans are going to effect your ability to get a mortgage. This can relate back to the first question, of percentages. Honestly, you'd probably prefer that your student loans don't effect your mortgage, just be sure you do the math on your budget, to be sure you can afford both your student loan payment and your mortgage payment (taxes and insurance), don't trust your broker to do it for you.

I'm sure there are other questions to ask, those are off the top of my head. I wouldn't give any mortgage broker my personal information unless he/she could answer those questions to my satisfaction (and did so in a personable, friendly way, you don't need a jerk of a mortgage broker).

I respectfully have to disagree with some of these points.

If you ask a broker what percentage they use for ratios, they will very likely tell you that it totally depends on your situation. If you have excellent credit with an low loan to value and tons of reserves, the answer is likely to be vastly different from someone who is looking to finance 100% with shaky credit and shaky job stability. Tell your broker what YOUR situation is. They will be able to guide you from there. Just because they could offer you X amount, doesn't mean you have to accept it.

I would not ask what lenders they use regularly. First of all, they are likely not to answer you. All day long, loan officers take calls that are from other loan officers "shopping" them (finding out what their current rates are). It is not in the best interest of the loan officer to disclose where they get their products from.

And, on the off chance someone actually told you who they typically use as an investor, it is very very likely someone you've never heard of. Brokers use investors on a national level, even if they are local banks. If someone in CA uses a bank in Maine, you've probably never heard of them.

If you call a broker, be very upfront about your student loans, ask for a estimated itemization of closing costs and go from there. Don't give them your social unless you want your credit run.

Good luck!