Carguy asked:


Hey all, I am a college student and I am looking at buying a house next year instead of renting. My parents and I are looking at houses but worried about being able to get a mortgage. Heres some info/comments/concerns.
I have 30k for a down payment.
2. My parents will cosign.
3. My parents own their home.
4. They have a home equity loan on the house, due to my dad being layed off a few years ago due to the .com bust.
5. Right now I do not have a “steady” job, I restore cars for customers, paint vintage arcade games for a museum, and also build cars to sell.
6. My monthly income varies from 500-5000 a month, it all depends on how much work I agree to do, and I would be able to do a lot more if I had a garage to do the work in.
7. For equity I have one vintage car that is worth 35k and a Muscle car that will go for 80-100k.
I would have about 5 roommates, and the going rent in the area is 500/month. Homes in the area are anywhere from 300-500k. What I would like to do is have a mortgage payment in the 2000-2500 range (or less) (which is equal to 5 roommates at 500/month) and then I would pay for the taxes/upkeep/insurance. I would keep it for 5 years.

I would really like to be able to buy a house in the area because the appreciation rate in the area is 18%, and I would really like to come out making money.

Whats my chances of being able to get a mortgage?

Kathryn

Juhani Tontti asked:




This article can handle only some of the many questions and I strongly recommend, that before you will sign anything, you go and meet the federal reverse mortgage counselor, who can tell, what is the best solution for your special needs and whether the reverse mortgage loans in general are the solutions for you.

1. I Own A Home But Have Modest Monthly Income.

Do not worry! The reverse mortgage loans have been developed to help American seniors age 62 and over with their financial problems. The basic thing, how these loans work is, that a senior can get cash against the value of his home. The key requirement is, that the home has equity left against which the senior can borrow. If he has an old mortgage, it must be paid away with the new reverse mortgage loan.

This all means, that the amount of your other assets nor your monthly income has no meaning in this case. The source of the cash is the home equity, which you have already paid and want to use now, when your situation has been changed.

2. If I Do Not Pay, Can The Lender Get My Home?

The reverse mortgage loans work in the way, that you will not loose your home. When you take the reverse loan, you have to take a mortgage insurance. That is a compulsory insurance, which covers the expenses in that case, that your home value, the selling price, is smaller than the sum of all reverse loan expenses.

However, when you as a borrower will remain the owner of the home, you must take care of all the normal expenses, like taxes, insurances, utilities, fuel plus other expenses and to keep the property in a good shape. If you do not take care about the taxes or insurances and do not keep the home in good condition, your reverse loan can be due and payable.

3. Can I Refinance The Reverse Mortgage Loan?

To refinance the reverse loan is wise, if the home value has increased, the interest rates have dropped or the maximum limit, which you can borrow, increases. However, check the costs of the refinancing. As a rule we can say, that the benefits, savings, must be twice as much as the costs of the refinancing.

4. How Should I Use The Money?

These loans are planned to be flexible. The guarantee is always the equity of the home. Actually you can decide how you take the money, as a lump sum, as monthly payments as a credit line or as a combination of all these. And, this is important, you decide, how you will spend the money. You do not have to report that to anybody.

5. When Do I Have To Pay All The Costs?

With the usual mortgage, you have to pay back every month. With these loans everything will be paid back at the closing of the loan. So if you have usual mortgage left you will pay that away with the reverse mortgage loan and in this way your monthly disposable cash increases!

Miguel

MadameJazzy asked:


What is a home equity loan? What is equity? Put them simply. What are the different types of mortgage loans? Make it as simple as possible, trying to buy a house in the future. Trying to get educated.

QUINCY