My girlfriend and I are going to be moving in together within a year or so. We originally intended on renting an apartment until we were a bit older, then purchasing a home. I was looking on Craigslist and started to inquire about purchasing a home. After talking to two other coworkers, they said they would rather buy a home outright at my age and with the options I have. They told me why pay for an apartment when you show next to nothing for renting, when for a few hundred dollars more, you could buy a home and make monthly payments, and build up credit and show you have something.
At my current position, I make 1,400 dollars a month, and my girlfriend makes 1,000 dollars, but will soon be making more when she gets on the phone (shes a travel consultant). I have around 25,000 in school loans, and she has 10,000. In the next year, we both plan on putting money into a joint bank account, hopefully putting in several thousand when within the year timeframe.
My questions, given the opurtunity, would you purchase a house at 21/22 years of age? My credit is damn good, being at 730, but can be better. After looking on Craigslist, I’m sure we could afford a house in the 50,000-90,000 dollar range.
What would things be to look for:
Credit Score?
Downpayment?
Rent to Own Status?
Mortgage, rates and what not?
Actual house, condition, anything else?
it’s all about personal preference. I prefer renting (and yes, I owned a home as well). I prefer renting because I can’t afford to pay someone to fix shit when it breaks!! I’d rather call my landlord and have him do it (like my garage door opener that broke a week after I moved in!).
Now, if I had the extra $$ (or knew how to fix shit myself!) I would probably rather own, but at this point, I’d much rather rent.
I would say own… my best advice to you is go to a mortgage broker you trust and tell them the exact situation. They will tell you how much you should save so that you will be ready to buy a house, and they will also tell you a ballpark of what you can afford. Of course in the end you have to make sure everything is feasible for you. But this will give you a better idea of what you need to do.
not knocking your salary at all, but with that number I might wait till it gets just a little higher for both you and your girlfriend.
You will also fall into the first home buyer program, so you will have some extra savings with the interest rate. Like I said though, talk to a Mortgage broker, the consultation is free and it will give you a great idea on what you need to do to buy your first house. If you need a reference to one, let me know.
Edit: If you are handy you could do what me and bob did. Buy a duplex and rent out half of it. This adds another source of income for when you get a mortgage.
Thanks for the info Whitey. I know we are not in the best situation, but we are still improving. After a year or so I think we would have adequate money for a downpayment, but not other things such as furniture, and other luxuries. I’m pretty good at fixing stuff around the house, and would not mind the challenge of a fixer upper.
Could you give me the reference you were talking about as well.
His name is Ray Dietz… office phone number is 412-369-9500. give him a call and tell him that John White sent you. He will set up a time to do a consultation for you. It never hurts to start now… there is no charge so there is nothing to lose. We did this months before we even started looking just so we knew what we could do when the time came.
You definitely do not want to spread yourself to thin.
if you keep your credit there you have more than high enough credit. There are loan programs out there that will bring a mortgage payment comparable to a rent payments (you will have more other shit to deal with tho)
buying > renting in any situation as long as you can afford to buy
EDIT: there are programs where you wont even need a down payment (80/20 loans), ask about them and see how the rates are…if i get back into being a mortgage broker ill let you know (company i worked for had some issues gettin off the ground so i left)
-if someone will let you rent to own, its usually worth it…its basically building equity b4 you buy
I agree, personal preference. But as far as your monthly income goes, you could easily afford a house, in my opinion. I bring home $1,760.00 a month and my rent is $600.00 a month. Then I have a consolidated credit card payment which is $245.00 a month, car payment is $408.00, insurance $116, plus all utilities, and my freaking cable bill is $130 a mth. My point with just telling you all that is, you can do it! You can get a house for alot less than that. Im the ass thats getting a one bedroom townhouse for that. Good luck with your decision
Buying a home, as long as it’s reasonably priced, cost as much as renting plus your building equity. If you’re a first time home buyer you can get an FHA loan, which requires little down payment, I think I only put down 6K, closing cost and everything on an 80K home. Mortgage is nearly the same as rent, alittle higher due to the escrow for the damn taxes…
depends on what you mean by cheap, get a good home inspecter before you buy and you will know what your getting into before you purchase a home, my 80K home in Bridgeville had no problems, aside from some small plumbing issues, plus it came with a home warrenty. Most of the time its all about area, you can buy a nice home for cheap in one area, or a shit home that cost you an arm and a leg in another, do your research before you consider purchasing a house…
I am currently doing a rent to own in Coraopolis. I just moved in, so I cant share any personal experience yet. But I am doing a land contract, over 5 years. So I am building up equity, plus, when I go get a home loan, I will have 5 years worth of payments to help me qualify for the loan. The house I am in was just built, I am the first person to live here, and I only pay $800 a month. Its a 4 bd, 2 1/2 bath home, with a two car garage. I couldn’t pass the deal up.
Buy as much home you can afford now. Your payment will stay the same and hopefully your income will increase over the years. Buying can be cheaper than renting. If you rent a place for x numbers of years and decide to move, you’ll have nothing to show for the years of payments. Buying on the other hand you’ll have equity and apprection built up.
I bought my home when I was 25 years old and it is payed for now. Granted, its not a exceptional home, but it’s mine.
do not put the house in both names it will save u a headache later if things dont work out i have a friend now who bought with his girl the deed in both names and the mortgage in his things didnt work for them and he cant get her out legally she owns it too so hes living with his parents praying she doesnt default on the loan but i would buy if i were you