Howdy! SO and I are trying to increase our home buying power and were entertaining ideas to decrease our debt to income ratio so we can qualify for bigger homeproperty financing. We've got about $140k positive equity in our current home (value ~$300k, ~$160k remaining note). My personal FICO is ~770 and SO is about the same.

Target new homeproperty budget $450k to $500k (max)

Current Monthly mortgage $1,300

Vehicle#1 monthly $800, remaining note ~$10k

Vehicle#2 monthly $600, remaining note ~$14k

If we took a home equity line of credit for the payoff of the two vehicles, we would need about $25k which would be repaid after we sell our home (minus interest only payments due in the mean time) $140k – $25k ($115k remaining)

I'm figuring high on closing costs ~$20K, leaving ~$95k for a down payment on the new homeproperty.

I used an online mortgage calculator to get this estimated total monthly payment including home insuranceproperty tax = $1,950

$450k home value

$95k down payment

$355k loan amount 3.8% interest rate 30yr conventional

With all of that said, we would ultimately be taking our monthly vehicle payments and rolling that into a larger monthly mortgage payment. Has anyone done something similar or is there a better option to increase our buying power? I'm worried that if we attempt to buy a home that is more than a lender would allow because of our current monthly debt to income ratio, on paper we wouldn't be able to afford the new home or be granted the financing.

submitted by /u/CinderChop
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