The news of the month in Louisville real estate is the upcoming date of April 30th. With the tax credit opportunity coming to an end, those looking to cash in the $8,000 (first-time homebuyers) or the $6,500 (existing homeowners) need to move quickly.
My loan specialist friend, Rodny Davidson, sent me this piece from the Wall St. Journal does a good job explaining the requirements that a borrower should expect when talking with a loan company about qualifying.
To qualify for a mortgage, you will need a job and at least two recent pay stubs. You also will be asked for two years of W-2 forms, proof of other assets and either your tax return or a form allowing the lender to get your return from the Internal Revenue Service. That means that items that reduce your adjusted gross income, like business expenses or IRA contributions, can reduce the loan for which you qualify.
Then there is the appraisal challenge. With home prices still falling in many markets, an appraisal below the purchase price puts the deal in jeopardy. That is because a low appraisal means the buyer must come up with more cash or the seller must lower the price to keep the deal alive.