Recovery Board
: RfM
Recovery from Mormonism (RfM) discussion forum.
buy a house?
This question is for those with experience in real estate.
As a solo parent with no home, the obvious answer is work and save.
The problem with doing so is that due to a combination of health problems (both myself and kids), we have so far had to rent and move around a lot.
My best solution to the problem would be to try to get a job in a city where homes are not as expensive as elsewhere, then try to find a real estate specialist who can assist with home buying in said location.
Only one hitch in my plan: My kids don't want to move away from where we currently live, which is too expensive - and jobs here in my field are hard to come by, for reasons that can't be fully explained on this site. They are in late teens and prepping for college, and have already pre-selected colleges that have low cost admission and high employment rates.
This question is for those with experience in real estate.
As a solo parent with no home, the obvious answer is work and save.
The problem with doing so is that due to a combination of health problems (both myself and kids), we have so far had to rent and move around a lot.
My best solution to the problem would be to try to get a job in a city where homes are not as expensive as elsewhere, then try to find a real estate specialist who can assist with home buying in said location.
Only one hitch in my plan: My kids don't want to move away from where we currently live, which is too expensive - and jobs here in my field are hard to come by, for reasons that can't be fully explained on this site. They are in late teens and prepping for college, and have already pre-selected colleges that have low cost admission and high employment rates.
Wherever you buy a home, there are certain minimum standards you'll have to meet.
For an FHA or VA loan, you need to bring 3% of the purchase price to the table. For a conventional loan, you'll need at least 10%. For a conventional loan or FHA loan without having to get mortgage insurance, count on needing a 20% down payment. Mortgage insurance can add a significant expense to the life of the loan, so the quicker you can get rid of it (or not need it in the first place), the better.
"Work and save" may sound like a cliche, but there's no way around it. Even with loan underwriting easing of late, there isn't anyone around offering 0% down loans or non-amortizing loans.
There are two ways to achieve your goal of requisite savings:
-- Earn more
-- Spend less
On the spend less side of the ledger, I'd suggest any of the following:
-- Sell any car with a payment and purchase a reliable beater (Honda or Toyota)
-- Move into cheaper housing. Don't be afraid of renting a trailer or condo temporarily
-- Cut eating out
-- Track your progress and set meaningful goals
-- Beware of false economies, like the insurance plan on your phone
Then, of course, earn more. Take on the scut work in your job that nobody else wants to do. Ask for extra hours. Do some work online.
A real estate specialist will not be able to help you out with the minimum down payment issues. There are some cities that have home-owner credits (Provo had one at one point), where the city will offer a credit to a new home purchaser, with the caveat that the person live in the residence for (usually) 5 years. Such programs are fairly rare, though, and you'd probably need to do some research first to see what's available.
For an FHA or VA loan, you need to bring 3% of the purchase price to the table. For a conventional loan, you'll need at least 10%. For a conventional loan or FHA loan without having to get mortgage insurance, count on needing a 20% down payment. Mortgage insurance can add a significant expense to the life of the loan, so the quicker you can get rid of it (or not need it in the first place), the better.
"Work and save" may sound like a cliche, but there's no way around it. Even with loan underwriting easing of late, there isn't anyone around offering 0% down loans or non-amortizing loans.
There are two ways to achieve your goal of requisite savings:
-- Earn more
-- Spend less
On the spend less side of the ledger, I'd suggest any of the following:
-- Sell any car with a payment and purchase a reliable beater (Honda or Toyota)
-- Move into cheaper housing. Don't be afraid of renting a trailer or condo temporarily
-- Cut eating out
-- Track your progress and set meaningful goals
-- Beware of false economies, like the insurance plan on your phone
Then, of course, earn more. Take on the scut work in your job that nobody else wants to do. Ask for extra hours. Do some work online.
A real estate specialist will not be able to help you out with the minimum down payment issues. There are some cities that have home-owner credits (Provo had one at one point), where the city will offer a credit to a new home purchaser, with the caveat that the person live in the residence for (usually) 5 years. Such programs are fairly rare, though, and you'd probably need to do some research first to see what's available.
...because it only pays off the mortgage to the lender if you die. It's better to buy regular life insurance, because the money will go to your survivors, and they can use it for whatever they need. Obviously, if you die, the house can be sold, so mortgage insurance isn't necessary.
One point about the type of loan---some properties qualify for zero down payment, depending on your income and other qualifications. If you have no money to put down, look into those.
If your kids don't want to move away, you'll just have to look for the best home you can afford in your area. I've been wanting to move for several years. I spend a lot of spare time checking the listings on the 'net. The cool thing is that you can search by zip codes, by community, or by price etc. I like realtor.com the best because you can select which criteria you want to search under.
One point about the type of loan---some properties qualify for zero down payment, depending on your income and other qualifications. If you have no money to put down, look into those.
If your kids don't want to move away, you'll just have to look for the best home you can afford in your area. I've been wanting to move for several years. I spend a lot of spare time checking the listings on the 'net. The cool thing is that you can search by zip codes, by community, or by price etc. I like realtor.com the best because you can select which criteria you want to search under.
I'm referring to MIP or PMI, which is lender-mandated (and, in the case of FHA loans, required unless you have 80% LTV on a 30-year or 90% LTV on a 15-year loan).
Life insurance does always make sense, though.
Life insurance does always make sense, though.
First thing, get your credit score.
Next, seek out a mortgage broker or a good home loan officer and find out what the current market rates are for home loans if you need to borrow. Without borrowing any money, you can get a pre approval to take to a Real Estate Agent.
Ask family, friends, etc. in the area you are looking to buy for recommendations for a good Realtor.
They will need to know your income, debt ratio, and pre approval work. Once you know what you can afford and what you can borrow you are set to look. Also, if you are a military vet, you might qualify for VA loans.
A good realtor can get you started with all your questions and advice.
RMM
Next, seek out a mortgage broker or a good home loan officer and find out what the current market rates are for home loans if you need to borrow. Without borrowing any money, you can get a pre approval to take to a Real Estate Agent.
Ask family, friends, etc. in the area you are looking to buy for recommendations for a good Realtor.
They will need to know your income, debt ratio, and pre approval work. Once you know what you can afford and what you can borrow you are set to look. Also, if you are a military vet, you might qualify for VA loans.
A good realtor can get you started with all your questions and advice.
RMM
Thanks, guys. At the moment am unemployed due to having to take time out last year for cancer treatment (all is now well) - but not being able to return to previous job, which was high stress and not great. Now seeking new work.
I already saw a real estate agent and cannot afford a home in the city where we now live through a traditional mortgage - but might be able to get into a special purchase plan for a first time home buyer program, which will cover the down payment but have to be willing to take the home being offered, which is a condo that isn't quite large enough for us - but guess it would have to do. Better to own than keep renting. This would only work once I'm able to get new full-time work.
My biggest concern is not finding work in this city.I have a university education but some gaps in employment, which is one reason finding work can be difficult. This city doesn't have a high unemployment rate, it's just highly competitive and with my gaps, it may be quite difficult to achieve a new f-t job right away. For that reason, would like to go to a different state or city where the competition is likely to be less intense and the homes less expensive - but kids just do not want to move with me, unfortunately.
Alpiner, I like your idea of taking on extra work, perhaps two jobs - whatever it takes - to save up and move on, and looking into ways to save. That's a good suggestion. Sometimes we get stuck in our thinking which is why I thought it'd be good to throw the question out there. I already own a fully paid car and I am renting the lowest cost available apt - which is still expensive where we live.
One idea, if I could get a caregiver to come in temporarily (for one year and be with kids), is to go to another city where I could get work more easily, and stay there as cheaply as possible, and work for a year to save, and then be more able to be competitive and move back with saved $ to get a home here - especially if I can't find good work here. But doing so involves two very tricky challenges:
1. Of course, being apart from kids - not ideal. They're not little kids, 19 and 20 - but one is still in high school, and not so mature and needs a very responsible helpful parent or other adult nearby due to a tendency to stray from school and responsibility. The other while more responsible, has health issues. Doing so would only make sense to me IF I found a highly responsible person/caregiver/friend to take my place and move in while I was away. The chances of being able to do that are minimal but am checking into it.
2) Ensuring that I don't expend greater cost by moving away (flights) and have a cheap place to stay while away - ideally with a friend, who would take me in for a very low cost - in other words, not spending the newly earned money to the point of not having enough savings as a result.
The one positive to taking a job elsewhere, is keeping career momentum by continually working in my field, rather than staying here and if unsuccessful in my own field, having to take whatever else is possible (most likely more than one other type of job = less pay and less of a career move).
I already saw a real estate agent and cannot afford a home in the city where we now live through a traditional mortgage - but might be able to get into a special purchase plan for a first time home buyer program, which will cover the down payment but have to be willing to take the home being offered, which is a condo that isn't quite large enough for us - but guess it would have to do. Better to own than keep renting. This would only work once I'm able to get new full-time work.
My biggest concern is not finding work in this city.I have a university education but some gaps in employment, which is one reason finding work can be difficult. This city doesn't have a high unemployment rate, it's just highly competitive and with my gaps, it may be quite difficult to achieve a new f-t job right away. For that reason, would like to go to a different state or city where the competition is likely to be less intense and the homes less expensive - but kids just do not want to move with me, unfortunately.
Alpiner, I like your idea of taking on extra work, perhaps two jobs - whatever it takes - to save up and move on, and looking into ways to save. That's a good suggestion. Sometimes we get stuck in our thinking which is why I thought it'd be good to throw the question out there. I already own a fully paid car and I am renting the lowest cost available apt - which is still expensive where we live.
One idea, if I could get a caregiver to come in temporarily (for one year and be with kids), is to go to another city where I could get work more easily, and stay there as cheaply as possible, and work for a year to save, and then be more able to be competitive and move back with saved $ to get a home here - especially if I can't find good work here. But doing so involves two very tricky challenges:
1. Of course, being apart from kids - not ideal. They're not little kids, 19 and 20 - but one is still in high school, and not so mature and needs a very responsible helpful parent or other adult nearby due to a tendency to stray from school and responsibility. The other while more responsible, has health issues. Doing so would only make sense to me IF I found a highly responsible person/caregiver/friend to take my place and move in while I was away. The chances of being able to do that are minimal but am checking into it.
2) Ensuring that I don't expend greater cost by moving away (flights) and have a cheap place to stay while away - ideally with a friend, who would take me in for a very low cost - in other words, not spending the newly earned money to the point of not having enough savings as a result.
The one positive to taking a job elsewhere, is keeping career momentum by continually working in my field, rather than staying here and if unsuccessful in my own field, having to take whatever else is possible (most likely more than one other type of job = less pay and less of a career move).
In Canada, first time home buyers can get a home for 5% down in a program backed by our government. Many get in trouble by buying too much house because of the low buyin. My advice is to buy quality but maybe smaller than you think you need. Build equity for 5 or 10 years and then, if the market value of your home has risen, move upmarket.
Ron Burr
Ron Burr
I avoided PMI with a second loan. There is also a point as far as how much you've paid back on your loan where you can have the PMI dropped. PMI is a huge waste of money.
If you're handy perhaps look for a fixer upper to find a more affordable house.
Get information on home property tax rates in different counties. Some are much lower than others. Do the same with quotes for homeowner's insurance. I saved on both car and homeowner's insurance when I moved to a different county.
Good luck.
If you're handy perhaps look for a fixer upper to find a more affordable house.
Get information on home property tax rates in different counties. Some are much lower than others. Do the same with quotes for homeowner's insurance. I saved on both car and homeowner's insurance when I moved to a different county.
Good luck.
Is the PMI dropped automatically once you have a certain level of equity in your home? My equity is probably close to 50% right now.