You set a time for Pat and Kris to come in for the loan application. You are in the process of going thru the loan application. This is the time where you need to ask appropriate questions relating to their financial situation, current and future, that will help you as a loan originator create an appropriate loan scenario for Pat and Kris. Thru interviewing Pat and Kris, you determine that they are planning on being in the house a maximum of 7 years. As a teacher, Kris has a contract for $45,000 per year. Pat being self employed shows on tax returns and income of $30,000 per year. They have currently monthly debt of $823 per month that includes a car lease and credit card bills. Kris also has a Student loan for $42,000.00 that is in deferment for the next three months. It will have a payment of $323.00 per month when out of deferment.

What would their maximum loan payment be based on the parameters provided based on a maximum debt to income ratio of 43%?

What would their maximum loan payment be based on the parameters provided based on a maximum debt to income ratio of 43%?

$6250 monthly X 43% = 2687.00

Please answer the following questions in your response: 1) What items/documents should you ask them to bring in?

2) What types of additional questions should you ask Pat and Kris?

3) What is an example of an illegal discriminatory question to ask Pat and Kris regarding their age?

4) Math Breakdown:

What would their maximum allowable debt be based on a maximum debt to income ratio of 43%?

The lender has maximum qualifying ratios of 28% for housing to income and 43% for total debt to income. What would their maximum loan payment (PITI) qualify Pat and Kris for (after taking into account their other monthly debts)?

Using the following numbers to answer the question "Would Pat and Kris be able to purchase this house?" (explain your reasoning)

-761 Principal and Interest

-150.00 Monthly Homeowners Insurance

-165.00 Monthly Taxes

-121.00 Monthly Private Mortgage Insurance

*Don't forget to take into account other monthly debt obligations.