when to buy a house?

[tiredofit]

Hi!

well, it's been almost a year since my chapter 7 was discharged. I was able to buy a brand new vehicle since then with a decent (9.5% for 72 months) rate. I have a couple credit cards that i use and get cash back AND payoff every month. won't get in that trap again. I am in an apartment for 1 year now and am thinking about the tax benefits of owning again. I owned previously a double-wide on 1 acre that I almost let get foreclosed, but was able to sell for a $800 profit at the 11th hour, literally. It was 40+ miles away from work and I didn't want the commute etc since I was newly divorced...---> whihc led to the bk chp 7, and paying child support etc...

Anyhow, I am in a better spot now than I was, thank god, and can afford probably around a $1200/month mortgage which should be a 180$ home right? With a rate I can expect? Now, the double-wide was 900/month at 7.75% for 30 years and it was a 100k loan. What can I realistically expect when I do go buy a home? I plan on maybe doing this before my lease is up May 2008. I am a veteran btw and have never used my va loan benefits as well. I want to stay as far away from manufactured housing as possible. I don't need anything fancy, just a ranch, with a garage and driveway in a decent neighborhood. I live around Cary NC. Seems that the homes in the bottom rung around here are 170's 180's. Can I get in one of these in another year for $1200/month for 30 year fixed?

thanks..

[Beach Bum]

I would say wait at least another year or two to buy and you'll get more for your money. Plus you can better your credit scores with a little work.
We're only at the beginning of this housing downturn.

[tiredofit]

just pulled my scores last night:

experian/equifax/transunion/ mid to upper 670's.

fico: 635

chp 7 discharged august 06...

is that ok so far?? i know it will get better......

you are right about the downturn, seems selfish, but I hope things go south a lot so I can buy something nice for 180k or so instead of a 1 bedroom shack on .09 acres....

[mixxalot]

Wait 1-2 years then buy

I am in same boat. I have my student loan bill 15k left to pay as the last bill and received my discharge in march 06. Have been rebuilding credit with new accounts opened recently and my car is paid off. Save save and save more. It takes quite a few extra gotcha expenses to buy a new home than I thought. For example, the earnest money and closing costs for escrow. That can run an easy 5-20k and they want this in cash up front before they will close a loan for a new place. My buddy was pre-approved and he has crappy credit and 120k in debt. He has little to no savings and today was embarassed when we met with the broker and real estate person and they told him that no lender is going to finance him with 100% financing with 56% back end ratio of debt.

[CurtInKS]

Assuming everything goes right, we are thinking 4 years. At that point, the home we live in now, will be paid off, as well as our vehicle. Knock on wood, we don't have to buy another vehicle, the only recurring debt we'll have are my student loans. I realize they are going to hang around forever, so we are hoping in 4 years, to be able to buy a home we can all fit in, without falling all over each other.

[emoney]

From the posts it seem that most people want to jump into home ownership before they have any real saving to fall back on.
For many years I to followed that path and ended up with a hand full of sand. Only when I waited until I had over 20% downpayment and a six month emergency fund did I purchase. Now it had been a blessing and not a curse. I was able to move when I was ready and pick and chose the best deal.
regards,
emoney

[BKOnce]

Rule of thumb :: $100 paycheck, $40 ==>> morgage, $20$ ==>> food, $20$ ==>> utilites & misc. expenses, $10 ==>> medical/emergency, & $10 ==>> savings!... Ah uh oh..==>> Nothing left for me!..

[HHM]

when to buy a house?

When you can actually afford it (and I don't mean simply being able to afford the payment).

[CurtInKS]

Well said, HHM. I think so many folks look at that 30-40% guideline, and think they can afford something they really cannot. That's why we are looking ahead 4 years. Paying off out current mortgage will give us $65,000 in equity to put toward a new home, as well as freeing up that money each month, and paying off our vehicle will do the same. Have to be reasonable about what you "need" as opposed to what you "want".

[score_recovery]

To CurtInKS and to HHM:
I agree with what you two stated. Why sink the boat before it leaves the dock? If you really want a house, you gotta plan. That's my strategy to save and save and save some more. I recently began saving with a credit union--and I can already see the savings. It's money I don't see, it's money I don't plan to see, and it's not money planned into my budget. I'm thinking as it's going now that I should have over 20000 come this time 3 years from now--then I'll play around with the "thoughts" ofbuying a house. Even then, if I don't, the savings will continue. High yields tierred savings with 5% plus then increasing within every 5000 savings "ain't" a bad thing. Never enough money when planning to buy a home.

You two have a realistic point of view that many others should consider before making life-long debt decisions.

As BK's example points out, what if???????????????? Then, boom! House gone!

[tradewiz50]

180K gets you a 2 bedroom 1 bath shack in my area.

just pulled my scores last night:

experian/equifax/transunion/ mid to upper 670's.

fico: 635

chp 7 discharged august 06...

is that ok so far?? i know it will get better......

you are right about the downturn, seems selfish, but I hope things go south a lot so I can buy something nice for 180k or so instead of a 1 bedroom shack on .09 acres....

[CurtInKS]

180K gets you a 2 bedroom 1 bath shack in my area.

I'd move.

[score_recovery]

In Appalachia (the eastern part of KY), I could get a "DARNED" nice home for 80,000--3-4 bedroom, large kitchen, family and livingroom, and an attached garage with at least an acre of land. That's why I am saving now.

[tradewiz50]

I'd move.

Why? Houses in my area have gone up over 60% in the last 4 years.

Sucks for first time buyers though.

[CurtInKS]

Why? Houses in my area have gone up over 60% in the last 4 years.

Sucks for first time buyers though.

Why would I move? Because I wouldn't want to pay $800 a month, for a two bedroom shack, as you put it. I can pay $800 a month here, for 2,200sq of new construction.