Is my mortgage lender asking for too much?
I am looking to buy a home maybe in 1-2 years. I don’t want a hard pull on my credit yet for the lender to run a credit report until I am closer to seriously looking. I just want to know where I’m at in terms of price. My lender said he can do a manual calculation to give me a ballpark of how much I can afford, but asked for w2 forms, tax returns, bank statements, pay stubs, copy of drivers license, and how much down payment I want to put. But does he really need my license, or social numbers on the w2 forms? Should I cross off the social security number on the w2 and not give my license just yet? And should I take these docs in person or email?
- Karen LLv 71 month ago
No, he isn't asking for too much. He is asking for the things he needs to give you an accurate estimate. Since he does this as his job, he naturally wants to do it right or not at all.
You, however, are asking for something you don't need at this time. Indeed, asking now how much mortgage you're good for is only partly useful a year or two ahead of time. No one knows what interest rates or anything else will be in 2 years.
There are plenty of online mortgage calculators, good enough to give you a good idea what price range you should be looking to pay for a house. Those are more than enough at this time.
In fact, you barely even need any kind of calculator. Take 1/3 of your gross pay. Your mortgage, property tax, house insurance, and any other loans you have to pay for (car loan, etc) had better not take more than that. Or 1/4 of your take-home.
- L. E. GantLv 71 month ago
Probably -- he most likely doesn't want to do the calculation since it will be a while before you actually take out a mortgage, and things will have changed by then. The thing is, he/she doesn't know what the mortgage rates will be two years down the line. Or that you will still be employed where you are now -- YOU don't know what your salary will be in two years' time!
Basically, use a mortgage affordability calculator on-line, especially if your bank has one. Minimal fuss, and it will give you a meaningful ballpark figure of how much you might be able to borrow. Then take a quarter of that and you'll have a good idea of how much you'll need as your initial equity (the cash you need to bring in to the deal).
Add the two together and there's as much you can afford to pay for a house.
- MaxiLv 71 month ago
In 2 year times your circumstances will be different to know, so stop wasting your time now doing this....... if you want a ball part figure you already know what you earn now x3 is likely what you will get as a mortgage loan, plus your deposit so it gives you a rough price you could afford right now...2 yrs time it will be completely different as you will have 2 yrs more savings and likely a higher salary
- TavyLv 71 month ago
Asking far too much, all you need is a rough figure. In 2 years time, your circumstances could change, house prices could drop. There is no need to give all that info now.
Try another lender.
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- SCATTY cLv 61 month ago
If you aren't looking to buy for two years, then it's fast too early to get possible lenders involved.
Just make sure you keep you credit good; that you earn enough and that you pay if off as many loans etc as possible. You also need to save, save, save.
Then when you are ready to start house hunting approach a lender