My husband and I will be looking to buy a house soon, within the next two years. We are relatively young, recently out of college, lots of student loan debt, some credit card debt (~5k) and we own nothing. I do have about 5k set aside for a down payment and I am still adding to that fund.
Are we being realistsic about owning a home on the next couple of years?
2007-10-21 10:50:11 · 7 answers · asked by Mrs. D 2 in Business & Finance ➔ Renting & Real Estate
I think you are well on your way! Keep socking it away and at the same time pay down your debt. Most importantly keep a consistent job for the next two years as that is one of the big items mortgage lenders look for along with the credit score and debt to income ratio. There are all kinds of lender programs available for you out there that can incorporate the seller paying for your closing costs.
2007-10-21 12:47:24 · answer #1 · answered by rick 2 · 1⤊ 0⤋
As long as your income is there and you are able to pay off your expenses or pay on your expenses you are building credit everytime you make a payment on time. Make sure that you are early or on time for your rent payments every month-this is not negotiable! 1 late can kill the deal you need at least one year of on time. Pay off any bill that you can and don't buy anything right before you close on the property! IF you can get to a 20% downpayment you will be better off and save a little money each month not having to pay MIP (mortgage insurance Premiums) Also remember that the down payment is only part of what you will need! there are closing costs too that will have to be paid. Sounds like you are on a good track right now and if you keep your credit pure! You will get your house. Treat your credit as Gold it is in someways. Today even some employers will pull credit and use it to decide which person to hire or promote. Heh you would too-If someone is in a bad spot financially I probably wouldn't want them handling part of my business either? See?
2007-10-21 11:01:37 · answer #2 · answered by helprhome 5 · 1⤊ 0⤋
Nope.
You might qualify for an FHA mortgage, but even with that, you'll still need 10% down. Unless you're buying a really cheap and crappy house, that means you need at least $15,000. And you're going to need another $5,000 for closing costs which includes a year's worth of taxes and homeowner's insurance.
Debt, never good. Whatever your total income is, your debt shouldn't total more than about 8% of it (not counting the house you're looking to buy). I don't know if student loans show up in your credit report or only if you don't pay them.
2007-10-21 12:16:38 · answer #3 · answered by Marc X 6 · 0⤊ 0⤋
Yes, depending upon your income. Obviously, if you are both unemployed then the answer is no.
Try to reduce that credit card debt little by little.
And yuo should hold off on buying a new vehicle until after you get your mortgage for your first home.
Try to get your debts as little as possible. Work on paying off your car and you crdit card debt. It will be much more likely for you to get approved for a mortgage if the only debt you have is your student loans.
Good luck!
2007-10-21 10:56:40 · answer #4 · answered by Anonymous · 1⤊ 0⤋
ok I worked part time on minimum wage and still managed to save for and buy my own house...live cheaply.. save EVERYTHING..
I am dead serious when I say live cheaply.. I mean eat alot of soup.. eat less meat... dont get coffee out.. (coffee and drinks in general have the highest markup $)...cut off internet/cable.. its ok to live with only 2 channels.. in the long run its better..
dont eat out.. take cheap lunches from home to work.
PAY OFF DEBT.. - your bank will look to see how you manage debt.. if you are making MORE than the minimum payment they will prefer that than somebody making minimum payments only..
pick up and return for deposit ALL pop cans you see... 5 cents adds up.. every little bit counts..
you can do it.. I did.. I have since sold that house and moved to an acreage (10 acres, 2500 sq foot house) and I have NEVER made more than $9.25 a hour (which is my current wage...) most of my work has been minimum wage...
2007-10-21 11:03:57 · answer #5 · answered by Anonymous · 2⤊ 0⤋
Off hand I would say yes! But it all boils down to your age, down payment, collateral, the state you live in.
Why not try to find a rental property that will apply some of your rent to increase the down payment.
But be careful of all the cheats, scam artist, and just plane crook's. Protect yourself and good luck.
2007-10-21 11:00:21 · answer #6 · answered by ra16297845 3 · 1⤊ 0⤋
Well, it would be much smarter to pay off your debts first. If you can afford to pay off that debt, think of how much that will free up each month? Pay an extra $500 PER MONTH toward your debts until they are paid off.
Good luck
2007-10-21 10:55:55 · answer #7 · answered by Anonymous · 2⤊ 0⤋