john the mortgage man logo
John The Mortgage Man
4838 Holly Rd. Suite 201
Corpus Christi, TX 78411
(361) 510-1420johnthemortgageman@hotmail.com
MENU

New Purchase

Before you start looking for a new home, you need to know what you can afford. You could be turned down multiple times, and you may be bidding on properties that you won’t even be able to buy. You should know which banks are likely to accept your application before you start looking for a home, because it will help you to determine your price range.

 

What Determines Your Eligibility for a Home Loan

Income is a major factor in determining how much of a mortgage payment you can afford, but there are other factors that are taken into account as well. Taxes, maintenance costs, insurance, and other expenses must also be considered. Many mortgage lenders don’t want borrowers to have a payment that exceeds a certain percentage of their monthly income. But if you have excellent credit, they may allow a payment to exceed 44% of your income.

Mortgage lenders also look at your credit history, so they’ll pull a report from the major credit bureaus. Not only can they look at your credit information, but they can also pull your FICO score. All of this information will help them to determine your eligibility, but they’ll also look at the history of your bill payments as well as the number of debts you have in relation to your income.

A higher credit score will make it easier to qualify for a mortgage. But if you’re always late on your bills, then it will be lower. The lender could reject your application, ask for a larger down payment, or charge a higher interest rate to reduce their financial risk.

The Prequalification Process for Home Loans

After you have done all the preliminaries and have prepared a financial statement, you can ask the lender for a prequalification letter. It will tell you the likelihood of getting approved for a loan based on your credit history and monthly income. It will also let you know how much you should be able to borrow, as well as the required amount for a down payment. But in some cases, a prequalification letter won’t be enough.

Many borrowers want to be preapproved for a loan, which will guarantee a specific amount. These types of home loans are more binding, because the lender has already done a credit check and evaluated your current financial situation. They’ll issue the loan after they have done an appraisal of the property, the contract has been signed, and the title has been issued.

 

Recent Changes to the FHA Guidelines

The U.S. Department of Housing and Urban Development helps people to get homes loans with bad credit, which are backed by the Federal Housing Administration. There are many benefits to these types of home loans (such as lower down payments), but you have to follow their guidelines if you want to get approved. Some of them are with regard to down payments, income levels, credit rating, and the condition of the property you’re currently buying. Not much has changed from the previous year, but there are some significant areas of which you should be aware.

Some of the changes to the FHA guidelines include:

  • Down Payments — According to the Department of Housing and Urban Development, the maximum amount of financing you can get for your home is 96.5% of its cost, so you only have to make a down payment for 3.5% of the purchase price. However, there are certain criteria for determining your eligibility. If you have a credit score of at least 580, you can get the maximum amount of financing and the lowest down payment. But if it’s between 500 and 579, you can only get up to 90% financing (which will require a 10% down payment).
  • Income — Before you can qualify for an FHA loan, you must give provide documentation with regard to your income and employment history, and lenders must verify both before they can approve it. They must also show that the income is likely to stay consistent over the next three years, and several factors are taken into consideration — some of which include overtime pay, seasonal employment, and changes in earnings over a two-year period.
  • Debt-to-Income Ratio — The Department of Housing and Urban Development requires the mortgage payment to not be above 31% of your monthly income, which is the standard debt-to-income ratio. Lenders also look at your other monthly bills, so they can adjust your loan amount accordingly. This combined total can’t be above 43% of your monthly income, but they’ll accept someone with a larger percentage in some cases.
  • Loan Limits — The Department of Housing and Urban Development raised the loan limits in both 2018 and 2019. Last year, the maximum loan amount was $679,650. This year, they raised the limit to $726,525 in high-cost areas and $314,827 in low-cost areas. But the loan limits vary from one county to another. Some parts of Hawaii, Alaska, Guam, and the U. S. Virgin Islands have loan limits that are higher than the specified maximum.
  • Property — Any home that you want to finance with an FHA loan must meet certain safety requirements. Appraisers have to look at the home for certain hazards — such as paint that’s deteriorating, radioactive materials, and toxic chemicals. They’ll also look at possible structural damage and shifts in the surrounding soil. And if it fails to meet these guidelines, the appraiser must file a report documenting the repairs that the seller is required to make before the loan can be approved.

Be sure to speak a professional for more information.

An Experienced Mortgage Lender in the Coastal Bend!

The mortgage industry is constantly changing, and it takes an expert who stays up-to-date so people get approved for home loans. Many of the changes is with regard to how lenders view credit, and John the Mortgage Man has a program that can help you get the credit score you need. We’re one of the most experienced mortgage lenders in Corpus Christi, Texas, and we’ll walk you through every step.

We’ve been in business for 23 years, and we’ll explain every detail. We have access to more products than most lenders, which will increase your chances of getting approved. We have taken people who couldn’t qualify for a loan, and we have gotten them approved.

If you want to work with one of the best mortgage brokers in South Texas, feel free to reach out to us. We would be happy to speak with you!



Recent Posts

Meet them man…the mortgage man.

mortgage man video

Debi CampbellDebi Campbell
17:05 13 Feb 22
John McCoy and his staff are just outstanding! Their efficiency and ability to respond quickly to any of my questions and needs is what made the... difference in me getting my house so quickly. It only took 3 weeks because of their ability to expedite m paper work quickly to those that needed it, along with my clean credit! Thank you so much for all your hard work! Each one of you!read more
Bobbie-Jo TorresBobbie-Jo Torres
19:49 07 Feb 22
Very quick and helpful. They made everything smooth and easy and in terms that I could understand! Highly recommend!!
daniel villarrealdaniel villarreal
04:19 03 Oct 21
John The Mortgage Man went that extra mile to make sure I received the best mortgage on our new home. Very satisfied. Thank You John.
Danny OchoaDanny Ochoa
17:39 16 Jan 21
John was the one who took a chance on me and my wife . Thank you so much for changing our lives and putting us in our new home . If anyone out there... needs someone to help them make there dreams come true reach out to John and the professionals mbn financial.trust me they won’t let you downread more
Herb FarleyHerb Farley
23:05 06 Jan 21
What an amazing experience! John and his team were extremely responsive and easy to work with! They made the loan process easy and never hesitated... to answer our questions. I would recommend John the Mortgage Man to anyone looking for a loan!read more
Mason ShirleyMason Shirley
18:19 04 Jan 21
Working with John McCoy was very easy and convenient. He walked us through the entire loan process with excellent communication and knowledge. We... were in a time crunch to purchase a home before the end of the year, and John worked fast to make it happen. Would highly recommend!read more
Debbie PowellDebbie Powell
05:38 21 Dec 20
John has helped me purchase 2 houses! John is easy to talk to and makes you feel like family. He is the best person you could have to help you in... this process! John will make it happen! Thank goodness he came highly recommended to me. John is truly a hero!read more
Vivian SimsVivian Sims
19:38 20 Dec 20
John McCoy has been our "mortgage man" on two purchases. Both went smoothly without a complication. The money and timeline were exactly what he... represented. I have recommended him to many looking for a mortgage. If you are looking for An honest, smooth mortgage progress, call "Jo John, the Mortgage Man". Way to go "Mortgage Man"!read more
Amando CanalesAmando Canales
20:21 18 Dec 20
John The Mortgage was a most professional experience my wife and I had a pleasant experience and were most satisfied with his service his can do... attitude was greatly appreciated.read more
Mark FosterMark Foster
11:17 30 May 19
John and his team worked diligently to make the process as easy as possible. They kept me informed and sent me step by step what they were doing so I... always knew where we were in the process. I had a very low credit score and they still made it happen! Thanks John, Troy, Allan and the whole team.read more
Rich and Bekah RobertsRich and Bekah Roberts
17:43 24 May 19
John and his team are excellent at what they do. Very friendly and helpful, yet also down to earth and realistic about your ability to attain such... and such mortgage. John will let you know if your "dreams" are a match with the reality of your financial situation. John wants you in a mortgage, but he wants you in one you can afford comfortably. I had numerous questions throughout process, and John gladly answered each and every one. I am very grateful my wife and I chose John, and would do so again if/when we have other mortgage needs. If you're ready to buy a home, you wont be disappointed with John McCoy!read more
Jeremy DeanJeremy Dean
06:16 07 Mar 19
John the Mortgage Man worked to get me and my wife into our first home this year! We had some issues with low funds, high debt and bad credit, but... John helped us to determine how much we needed to save up to get in the home we wanted. Once we got there John was able to hook us up with a lender and get us a good deal on a loan. We closed in just over two weeks from the time we found a house that we wanted! John always made us feel at ease and answered any questions we had. Very knowledgeable, very responsive and very kind! Thank you John for everything! Highly recommend!!!read more
John McCoyJohn McCoy
15:12 19 Feb 19
John made getting our loan processed very efficient and worry free. He will do the same for you!
CJCJ
19:47 20 Oct 18
12 days from application to closing, now that's fast! Great overall service, everything John said he would do, he did it. My clients were thrilled.
Frank J RosatiFrank J Rosati
19:15 20 Oct 18
John made everything easy for the purchase. He had everything covered (all the associated costs, paperwork) that I needed to close. It was a pleasure... to work with him again (this is my second time working with John) and I would highly recommend him to anyone looking to finance a home.read more
debbie powelldebbie powell
19:05 19 Aug 18
John goes out of the way for you to make sure you are informed, kept up to date, and always professional. Definitely goes the extra mile to help!... Everything is done in a timely manner. Thanks so much John! This is my second mortgage through John McCoy and team.read more
Shawn LockettShawn Lockett
21:22 23 Mar 18
This guy is a wiz!!! He knows a ton about this business and how to get things done!!! Be up front, honest, and ask him your concerns and he will be... straight with you in return and get you in the house of your dreams... He was able to take us start to finish in three weeks time!!! Awesome awesome experience!!! P.S. He will only call you with news—it’s how you interpret it is up to you... Give John a call, you won’t regret it!read more
js_loader


John McCoy NMLS #308360
MBN Financial NMLS# 1009879

John The Mortgage Man
4838 Holly Rd Suite 201
Corpus Christi, TX 78411
(361) 510-1420johnthemortgageman@hotmail.com