SubscribeSuccessful Home Ownership I – “Qualify” vs. “Afford”
Author: Evan Vanderwey
Website: http://www.lansingmimortgage.com/successful-home-ownership-i…
In my many appointments with hopeful homeowners to be and with those hoping to make a transition to another home or purchase a second home, I often draw a simple distinction between two words—qualify and afford.
The word qualify is my word. As the lender I need to make sure that I can “qualify” the borrower for the loan and ultimately the home that she wants.
The word afford is the customer’s word and is often ignored in the lending office. This is the process whereby the potential borrower determines what she is able to pay each month based on her income and other bills and lifestyle habits.
Let me give you an example of the conflict:
A couple recently applied for a mortgage and said they could afford a payment of $1750 per month. She was employed full time making around $39,000 per year her husband was between jobs. He had been off for 6 months and had three prior job changes in the past two years including one complete career change 15 months ago. His salary in his most…
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