How much income for loan ?

At least 400k with absolutely no other debt (no car payment, student loans, CC, etc)

i would think closer to 1/2 mil. most of it has to be salary as well.

When I inquired about a mortgage two weeks ago, Bank of America's pre^qualification was exactly four years' salary. I have no other debt.

The loan-to-value ratio didn't seem to matter; neither (bizarrely) did the monthly maintenance of any apartment I might be looking at.

was it salary or salary + bonus?

It's salary bonus.
If strictly salary, you can get away with 300k (plus 100k in bonus)

ab_11218, if you're asking me, about BofA, when asked about my income I only told them my salary. The ratio of bonus to salary at my company is very small, and to be conservative I decided not to consider it at all.

4 YEARS SALARY ? Could you explain please

MIB, well, he didn't phrase it like that, but the amount I could borrow was exactly 4 times the amount I gave him for my annual salary. My credit rating is on the high side -- over 800 -- so that probably helps.

My situation is a little irregular: I'm looking to buy an apartment in the city now, have someone live there until I'm ready to move back, and then move in. You'd think that that would reduce my borrowing capacity, but the figure he gave me was *without* a tenant (and thus presumably with the presupposition that I'd be paying the mortgage with my income).

And my income, while documentable in English and on US tax forms, is earned outside the US. Maybe BofA is anticipating a collapse in the value of the dollar and thinks foreign-currency income is more stable!

I've been with BofA since I was in high school -- more than half of my life -- but I don't think that gave me any unfair advantage as I was talking to a mortgage specialist out on the west coast, not a face-to-face interview in my local branch.

I didn't really get the chance to ask him how he arrived at the number. It wasn't enough for me to buy even a 1-BR in the neighborhoods I was interested in, so the conversation sort of ended with, "I'll be saving my cash for another few years and will probably look into this again at that time."

Good morning MIBNYC,

Each individual's financial picture is unique and therefore you can't really get an answer to your question unless you are thoroughly Prequalified by a Mortgage Banker. There's no specific formula for saying how much annual income is needed to qualify for any given loan; there are too many variables both in your unique financial qualifications and those of the property you wish to purchase.

Your best bet is to meet with a Licensed Mortgage Loan Originator and get prequalified. Loan Originators who work for either Mortgage Banks or Mortgage Brokerages are Licensed; LO's who work for the regular depository institutions are only regiesterd. Thus you get incomplete information such as was pointed out about the BofA website and it's qualification analysis.

Trevor Curran
NMLS #40140
Mobile: 516-582-9181
Office: 516-829-2900
Fax: 516-829-2944
PowerHouse Solutions, Inc.
185 Great Neck Rd, Suite 240
Great Neck NY 11021
Licensed Mortgage Banker NYS Dept. of Financial Services
NMLS#3528

@Triple .. that was very informative and thank you for really taking the time to explain it. I am also saving up my cash to possibly come to the table with 70% down and see how well i do with a Mortgage Banker.

MIB, no problem. Since 20% down is the standard, I too had been hoping that a high(er) LTV ratio would work in my favor, and that my upper purchasing limit would be closer to 5 times my down payment, but it doesn't work that way; salary is what they base it on. Your savings + what they lend you = your upper bound.

Of course, your figures for both salary and down payment are much, much higher than mine, but the fact that you've got 70% down probably won't save you if the remaining 30% is too high a multiple of your income.

i dont think the old advice of 2-3x salary is as true as it used to be. when people use to say 2-3x salary, interest rates were around 5-6%/year. with interest rates at 3.4-3.5%/year, 3-4.x salary is probably more doable and realistic now depending on other factors.