Getting a mortgage

Would love to hear some personal experiences on this topic. This process can be fraught with issues in the best of circumstances. I would like to see how it's handled "on island".

I have what is probably a dumb question...given the housing prices in places like the USVI (or Las Vegas and California), are there different calculations for 'how much' home you can afford? Like isn't the standard 2.5 times your annual income? Well, 2.5 times the average annual income wouldn't buy squat in CA or LV.

Someone making $60k wouldn't be able to afford much if the standard 2.5 goes here and it's hard to find a decent, safe house for under $150k.

Just wondering 🙂
Brandy

Brandy,
I would throw out the 2.5x your income concept. Rates are some of the lowest we've ever seen, and that allows you to buy much more than you could previously. How much is that? It really depends on several factors: your debt to income ratio (which is where you have the idea of 2.5x your income), your amount of down payment which is your Loan To Value, and of course your credit score. This mix (and other particulars) is then analyzed to determine what type of loans are available for you, and all those ratio requirements can vary depending on what kind of loan you want, i.e. Fixed, ARM, Interest only, etc., and whether it is conforming to the underwriting requirements and loan amount restrictions of FNMA, FHA, VA, etc. You may also find some loans that the local bank will hold, called portfolio loans, that may have looser requirements, but don't count on it. Sometimes I have seen that with higher mortgage amounts, you can push the ratios some, as long as the income can easily service the other debt. The kicker in the islands is 'wind storm insurance', which can be expensive and leave less of the total amount you can use towards your principle and interest which means a smaller loan amount. All in all, it is not much different than in the States... the conforming loan limits are higher in the USVI... you really have to apply and see what you can qualify for. Each applicant is unique and different. Who knows, you may be able to qualify for more than you thought!
Edgar

We purchased our home on STX in 2002 while living off-island and found the whole process to be much easier than expected. We started by making several trips to determine which island we wanted to live on (STT too crowded and developed, STJ too remote for daily life, but STX was perfect). We then contacted several mortgage companies to find out what we qualified for and how the process worked. I highly recommend Denis Schwab of Allied Mortgage Company. Next we selected a real estate agent by looking through the local real estate magazines. All agents ARE NOT created equal. Our first agent was very experienced and well established on STX. Although she was fairly responsive prior to and during our first house shopping trip, she did not provide the level of service we were used to and she was very unresponsive when we did not make an offer on a house on that trip. We selected a second agent for our next trip who turned out to perfect. Amy Landerwilde of Coldwell Banker answered every e-mail and returned every phone call immediately. We did find a home on our second trip and made an offer the day we left the island. The negotiation process lasted a week or so (the seller lived off-island and used the house for vacations only). All the paperwork was done via Priority Mail and Amy and her staff coordinated the details on island (inspections, etc.) Although we attended the closing in person, we did not have to. We had no glitches in the whole process, which took about two months. We just refinanced our loan last month due to the rates being much lower (~2%) than when we closed in 2002. Once again we used Denis Schwab of Allied Mortgage and did it all by mail with no problems. A lot of the paperwork has to be notarized, but that is the only difference that I noted between the refinancing process for a home here in the states and via mail in the USVI.

Thanks JE. Great information. It's always nice to get a personal recommendation for this type of process and your thoughts and notes were very helpful.

I've had very similar experiences with real estate agents in the VI. Seems if you don't make an immediate offer, they simply write you off as a mainlander with dreams and stop calling. I had one write me an email after viewing 3 properties but not making an offer that said "...when you are serious, call me." Just because the first three properties you show me are not suitable DOES NOT mean I'm not a serious buyer! I was shocked and replaced her immediately. Even on a small island there IS competition.

Very different from the agents in California. They fight hand over fist for each and every deal and seem to fall on the exact opposite end of the service spectrum. They will inundate you with calls, emails, letters and any other form of communication just to stay in touch in with you.

I'm now using Dennis Murphy with Stryker Realty and he has been absolutely wonderful. We have a three hour time difference between us and he has made every effort to connect with me when he promised even when it has been 11pm island time, nights and even weekends. Anyone looking for a responsive agent, please give Dennis a call. I couldn't give a better recommendation.

Thanks again for the personal recommendations especially the mortgage guy.