Corey Grushin

If you wish to read an article regarding the finding it was published in todays Star Ledger in the business section. - Wed May 14 2008, 12:51

Alison the home you are considering purchasing is a mixed use property (commercial/residential). As long as the total number of units is not greater than 4 you will have your choice between a commercial or a residental loan. Typically you will be required to put down 20% if the property has a commercial space in it. I have to check guidelines on another program too see if a lesser amount of downpayment is acceptable. I will get back to you. - Tue May 13 2008, 21:40

Dear Denise it always better to see what you can afford than to look at properties first then find out you really can't afford them. Here is a couple of calculations you can use to figure out affordability. You don't really want to exceed a 40% total debt ratio of your current monthly income before taxes, it can be a strain. So calculate your monthly income presently and subtract the minimum payments you currently must make on all your obligations.
this number will give you an acceptable payment the bank will look for for qualifying. out of this number you should deduct the monthly expense for home owners insurance and taxes. Now if you take the remaining number and divide it by say 6 (6% interest rate amortizes at $6.00 for every $1000 borrowed on a 30 year fixed) This will give you an idea how much you can possibly borrow thus give you your price range figuring what your down payment would be. Let me know if I can be of further assistance. Good luck Denise - Tue May 13 2008, 21:30

Depending on your current housing situation you can do loans with as little as 3% down unless your a Veteran then 0% down. I don't have knowledge of the housing market there but I do have knowlwedge regarding the mortgage market. Good luck Dave. - Wed May 7 2008, 14:28

Based on the information you provided David, the original balance on the 1st mortgage was for $444,000 to get a mortgage payment of $3400/ month P & I. If this is not correct and the first mortgage was for $260,000 the monthly payment would be $1989 p & I. If I were to to assume your paying an additional $1410 per month on top of the payment due, you'll pay off this loan in 7 years total or in another 3 years if you been doing the prepay form the beginning on the mortgage.
Your HELOC doesn't figure per your information provided. An interest only payment on $200,000 at prime minus 1% or 4% is only $666.66/ month. If your payment is interest only then the interest rate on this loan is 7.2%. That would provide you with a monthly payment of $1200/month.
If your prepaying the 1st mortgage then you're throwing money away per my calculations because the savings are only minimal based on the term & the interest rate. You should be paying principle down on the HELOC. It may also be beneficial to refinance so you could save some money.

If my figures or assumptions are incorrect, please provide (original loan amounts and dates of the loan, interest rates, amount of prepayment, terms of each loan (period) - Wed May 7 2008, 08:37

David need to know the type of loan is onthe $260k loanis it fixed, an ARM, etc....What is the term of the repayment on the $260K? How much are you prepaying onthe loan/month? The HELOC is the term, "draw & interest only for the 1st 10 years, repay total in 20 years? The answer to my questions will help determine what you should do. Both interest rates are very low presently 5 % and 4% and current interest rates are about 6.25% on a 30 yr fixed without paying any points. There are ARMS in the lower 5% bracket as well. Paying off both debts may not be the best option to position your money as well unless you're able to prepay the mortgage and put money away as well. If you provide me with answers to my questions I'll gladly provide you with a "Equity positioning Analysis" so you can make a decision for yourself. - Tue May 6 2008, 14:59