All Forum Posts by: John Burke

Quote from @David M.:

@Joseph O'Sullivan

Don't forget that the tsp repayment will be counted against your DTI when looking at conforming loans.

This is not true for conforming/conventional, FHA, VA or USDA loans.
https://selling-guide.fanniemae.com/Underwriting-Borrowers/L...
Loans Secured by Financial Assets

When a borrower uses their financial assets—life insurance policies, 401(k) accounts, individual retirement accounts, certificates of deposit, stocks, bonds, etc.—as security for a loan, the borrower has a contingent liability.

The lender is not required to include this contingent liability as part of the borrower’s recurring monthly debt obligations provided the lender obtains a copy of the applicable loan instrument that shows the borrower’s financial asset as collateral for the loan. If the borrower intends to use the same asset to satisfy financial reserve requirements, the lender must reduce the value of the asset (the account balance, in most cases) by the proceeds from the secured loan and any related fees to determine whether the borrower has sufficient reserves.

Note: Payment on any debt secured by virtual currency is an exception to the above policy and must be included when calculating the debt-to-income ratio.

Quote from @Mike Gratzmiller:

looking for advice on Points buy down... Loan of $162,000 (SFH) is currently at 6.275. I'm being told I have the option to buy it down to 5.75. How many points would that be? Do you think it's worth the $$ to do so... approx $3,150 to make that move.

Appreciate any and all advice... I'm a first time buyer.

Here's what I show my clients to help them decide if buying down the rate makes sense.
In your scenario, the difference in your PI payment @ 6.275 and 5.75 is $54.71. Your cost is $3,150 so your break even point is $3,150/$54.71 = 57.57 months or just under 5 years.