Should be wait and buy or move now and rent?

Question

Which do you think would be better? My husband needs to build more credit so renting would help us afford a better home a year from now.. but buying now we wouldn't have to worry about it being "someone elses home".... I'm stuck.

Answer 1

Renting is like throwing money away, if you can afford to purchase don't wait. Make sure of what you are buying. Don't just buy a house because it looks good. You must consider the location, is it where you want it, if you have kid, are the schools in the area good ones. How long will it take you to get to work. Make sure to get a termite inspection even if it is a brick house there are parts that are made of wood. The roof, plumbing, air condition, heating are also things that should be looked at, these can be costly if repairs are needed. Depending on where you live flood insurance maybe needed. Then there is the mortgage, low fixed rates are the best. If you don't have any credit this is not a bad thing, it is better than having messed up credit.
That be said the housing market right now is the best investment out there you save money by paying your mortgage, this is like money in the bank. Also the value of the house goes up building on top of your savings. Just make sure you can afford it don't buy a big house that you wont be able to pay the mortgage. Add everything up before your final decision. Monthly mortgage, taxes, water, insurance, association fees, etc

Answer 2

Wait a year and work on building your credit. You can do small things now to not only build it, but improve it (unless you have perfect credit, this is always beneficial). Pay down (or off) as many credit cards as possible, but don't close them. Lots of available, open credit is a plus, lots of maxed out credit very negative. Check your credit history and send dispute letters to any creditors who's claim you don't agree with, and a bonus is that some of the older claimants will simply drop the claim rather than proving you owe anything. For any other claims, contact the ORIGINAL company you owe money to, NOT the collection agency, and tell them you will pay them, not the collection agency. Sometimes this works, sometimes not, but it's worth the points. Most importantly, pay ALL bills on time and keep them current, this will make a significant difference. You can save a lot of money by getting a good mortgae rate to begin with. Good luck!

Answer 3

It is always better to buy if you can. You probably don't want to buy the best home you can afford, anyway. Decide how much of a monthly payment you can afford. Then subtract about 20-30%. That is the maximum you want to your monthly payment to be. Now, pay the full amount you can afford each month, with the extra going toward your principal. Typically, in one year, you have actually made only one payment towards your principal.

So, if you have a $1,000/month house payment, after one year you have paid roughly $1,000 off on your house, while you have paid the bank $11,000 interest! But if you decided you COULD afford a $1,000/month house payment, but only finance a house with a $700/month payment, and still pay $1,000/month you will pay off $4,600 of your principal in the first year, paying $7,700 in interest.

This is HUGE! After that year, your husband will have done more to build his credit than he could have renting. You can refinance the house and get a lower interest rate. A lower interest rate means a lower house payment - but DON'T lower how much you will pay. You can actually pay off a house in 10-12 years this way, less if you increase your monthly payments in a few years. I guarantee this can get you into your home of your dreams MUCH quicker than getting the best house you can afford right now.

Answer 4

First things first. Get pre-qualified to see how much you can afford. If it isn't good enough then wait. I think buying a home is the best investment you could ever make. You could always start with an ARM or intrest only loan and then refi later to a fixed rate. That would get you in the door. When you pre-qualify they will also tell you if you should wait till you fix your husbands credit. Just be honest with them. I agree - by renting you are gaining nothing.....good luck.

Answer 5

I'd say BUY...and now is the perfect time to buy with the housing market taking a dip...definitely a buyers market right now... a house is always a good investment, and you are almost always turn a profit... if you rent you are basically throwing your money away...if you can afford it, I'd definitely buy... we have recently bought our second home, we made a nice little bit on the first one so we were able to upgrade a bit on this...it's kind of a scary proposition at first, but well worth it!

Answer 6

My wife and I have the same problem we rent and we want to buy because we are tired of the slum lords out there that take the money and out very little into the place to keep it nice.

However, we have asked ourselves if living in this area is where we want to be 5 - 10 years from now. With her job and the promotions that are on the table and my line of work we have decided to hold off just a while longer before we go out and buy.

Answer 7

Your answer is in your question. Building good credit is THE MOST IMPORTANT THING YOU CAN DO. If your husband needs another year to do so, and then you can buy a better house, there's really no question at all. Believe me, I know PERSONALLY, and my dad taught me that from way back in the 1960's when I was a teenager, and he was "right as rain" then, and he still is. And it's always "someone else's home" till you've paid the mortage off, so, not to worry. God Bless you.

Answer 8

This is a complex question. A home is 2 things: a housing expense and a real estate investment. The housing market is in a decline. This results in a buyers market. The bottom may not be near, so buying now should only be for a long-term holding. Refer to the link below and good luck.

Answer 9

we are in the exact same boat. i'm so tired of renting and having my landlord take his time to fix things. we could buy a house right now but we wonder if we should wait until our credit is a bit better. we have opted to keep renting for a bit more so we know we will be able to get the house we really want. of course one of reasonable price, don't wanna go overboard with the first house. start small and work your way up. wish you the best.

Answer 10

We have been looking at houses for the last four months because we had a contract on our property. It didn't work out but what I saw was this. It is a buyers market NOW. But, people selling haven't seen the light yet and won't drop their prices so they've been sitting on their houses. Even though it's a buyers market, your apprehension is wise. Like one answer said, a year is nothing. Take that time to find out what you really want in a home. I didn't realize what I wanted until we started looking. And we looked at at least 40 houses.