Does this mortgage payment sound realistic?

Loan Amount: $140,000
Interest Rate: 3.5%
Down Payment: $0 – 100% financing

Our mortgage lender is actually related to my husband. He told us that our monthly payments, including taxes and insurance, will be around $750/month.

I used this mortgage calculator: http://michaelbluejay.com/house/figurepayment.html and it estimates that the payments would be over $1000. We simply can’t afford that. On the same website, when I entered our income, it said we could only afford a $126,000 loan if my husband works 40 hours per week. He actually works 60, and at that point it says we could afford a $150,000 loan and that the payments would be around $920 including insurance and taxes. Uh…that doesn’t quite add up.

I’m not sure what to believe. We’ve already made the offer on the home, it was accepted, and the closing date has been set. We’re so excited about this house, but people keep telling us that monthly payment sounds too low.

What should I do?