Ephemera

Tuesday, September 05, 2006

Million Dollar Houses

In case you’ve ever wondered “What do people have to earn to be able to live in a million dollar house?”
I did some calculations based on my experience as loan officer. Lending guidelines were from First Horizon.
Here is the summary of what is required:

Summary
The approximate minimum requirements for the purchase of a house valued at $1.25 M are as follows :

1 Yearly income $320,000, verified by CPA or attorney for prior 2 years.

2 $ 142,328 in cash. includes pre-paids, down payment, 6 months verifiable reserves, etc.

3 Credit Score: 700 or higher 680 may be possible, but more out of pocket and interest expense.

4 Not much other debt!
Less than 1500 in other monthly debt payments (not including present house, which it is assumed would be paid off) You need to have less than 45% DTI, and less than this max would be preferable.

Monday, September 04, 2006