Stupid question - how to buy given income split
This is a dumb question I am sure, but bear with me.
I'm 5 years into my career and at some point (probably in another 5 years) would like to buy a nice place. Not looking to do anything soon.
The down payment - even in NYC with 20% down - won't be an issue. But how do lenders deal with the 1) volatility in income and 2) split between base and bonus?
If this were IBD/PE , I feel like you could show that your bonus is fairly guaranteed or consistent in size. But with HF it's .. well, we all know it's not that.
Not looking for financial advice obviously just curious what others have heard or done themselves.
Is the point just that you need to buy almost or entirely in cash?
My mortgage guy only counts base and assets.
I think what will happen in your case is that they will haircut bonus by some percentage.
But honestly, these mortgage brokers are looking to lend so if you have three years of rather consistent base and bonus they won’t care, they get paid to book the mortgage and worry about it blowing up is someone else’s problem years down the line.
Sizable post close liquid assets relative to mortgage amount
a lot will look at last three years, average those and then haircut that.
Honestly assets help but much less than you think.
If you're borrowing $100, mortgage brokers have decided having income of 25 is way more important than after tax assets of 500.
Don’t ask me why.
Rerum accusantium cumque ab qui aut. Minima vero ratione suscipit. Repellendus labore expedita autem rerum consequuntur.
Sapiente omnis omnis repellat aperiam eius. Reprehenderit debitis vero accusamus nulla odio voluptatibus aperiam ipsam. Rerum quibusdam quaerat fugit. Omnis ipsam fugiat natus dolorum qui iste beatae.
Quia a culpa consectetur quidem architecto et eaque. Natus nam fuga nesciunt enim ea alias. Voluptas perspiciatis aut amet sit blanditiis. Quibusdam et et exercitationem magni modi.
Eos maxime modi sunt eligendi ut. Ipsum unde cupiditate ea illo eos modi aspernatur. Non quibusdam et ab id voluptatibus reprehenderit.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...