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05.28.08, 16:43 PM General Topics
33 replies
so...i have 90k in savings, hhi is 61k...what can i afford in terms of house?credit is pretty bad but we dont owe anything anymore...tia [ Reply | Watch | Flag ]
General Topics 05.28.08, 04:43 PM Flag
 

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I wouldn't buy now, frankly. Keep those assets liquid. [ Reply | More
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General Topics 05.28.08, 04:44 PM Flag
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ITA. Someone in your situation shouldn't gamble in an unstable market. Wait it out a bit. [ Reply | More
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General Topics 05.28.08, 04:46 PM Flag
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np: what does this mean, your situation? [ Reply | More
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General Topics 05.28.08, 04:48 PM Flag
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Someone with low income and bad credit who would be really screwed if the housing market tanked after they bought. [ Reply | More
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General Topics 05.28.08, 04:50 PM Flag
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61K - low income? [ Reply | More
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General Topics 05.28.08, 04:51 PM Flag
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Sad, but true. [ Reply | More
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General Topics 05.28.08, 04:58 PM Flag
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Poverty for a family of four in NYC is 45K. [ Reply | More
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General Topics 05.28.08, 04:58 PM Flag
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where did you get that stat? the average income in nyc is 55k so that seems strange [ Reply | More
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General Topics 05.28.08, 05:11 PM Flag
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That is the fed stat [ Reply | More
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General Topics 05.28.08, 05:18 PM Flag
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um. yes, it's low income [ Reply | More
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General Topics 05.28.08, 05:03 PM Flag
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In NYC? Yes, given the price of real estate. [ Reply | More
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General Topics 05.28.08, 05:05 PM Flag
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not really. if she can afford what she buys and she has a steady income, she's fine. [ Reply | More
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General Topics 05.28.08, 04:53 PM Flag
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I think that if she had a good credit score, she could get a great deal in this market but if she's got bad credit, no bank w/ lend (b/c no bank is taking risks) or if a bank would lend, the interest rate would be high. [ Reply | More
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General Topics 05.28.08, 04:49 PM Flag
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What's your monthly take home? [ Reply | More
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General Topics 05.28.08, 04:44 PM Flag
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childcare expenses? any debt? [ Reply | More
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General Topics 05.28.08, 04:45 PM Flag
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no childcare expenses, no debt [ Reply | More
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General Topics 05.28.08, 04:53 PM Flag
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i'd say somewhere between 300k and 400k. depending on the actual rate you get. good luck. [ Reply | More
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General Topics 05.28.08, 04:55 PM Flag
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^^^wait. probably closer to 300k than 400k. what's your monthly take home? how many dcs? [ Reply | More
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General Topics 05.28.08, 04:56 PM Flag
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monthly i would say anywhere from 5 to 5.5k, one dc [ Reply | More
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General Topics 05.28.08, 05:05 PM Flag
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can't be 5.5 if your hhi is 61k. at most it's 5100 and that's without any deductions. but you might be able to do something in the 350 range. [ Reply | More
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General Topics 05.28.08, 05:08 PM Flag
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some months it might be 5.5, others it is 4.9...so i am averaging it out [ Reply | More
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General Topics 05.28.08, 05:10 PM Flag
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so let's say you are netting 5k. is that before or after taxes? before or after health insurance? (i have a similar income and i'm trying to figure out how much of our deductions you have as well). basically, on 5k net we can easily put 2k or even 2500 towards a house. so assuming something like 700 per month to pay for 100k borrowed, on 2500/month you can borrow under 350k. so i'd say that you can safely get a 300k mortgage, plus your down payment puts you at about 375k purchase price. and i'm not saying this is what the banks will loan you, but this is what you can probably afford to pay. good luck. [ Reply | More
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General Topics 05.28.08, 05:15 PM Flag
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I'd say closer to 250K. We got a mortgage for 350K when out HHI was 140K (combined and we did have childcare) and it was tight. [ Reply | More
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General Topics 05.28.08, 05:15 PM Flag
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^^^ and that is provided that you use all 90K for downpayment and closing costs so that your actual mortgage is under 200k [ Reply | More
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General Topics 05.28.08, 05:21 PM Flag
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Do you know your credit score? If your score is anywhere below 650 then you should really just concentrate on getting your credit score up, IMHO. Rules are more and more tight to get a mortgage now and even if you can get one, you'll get a much higher interest rate w/ a poor credit score. [ Reply | More
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General Topics 05.28.08, 04:46 PM Flag
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dh's is high 500'd...mine is low 500's...a vast improvement from below 400 where we were! [ Reply | More
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General Topics 05.28.08, 04:54 PM Flag
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I'd give yourself one more year. use one credit card and buy groceries on it and pay it off every single month. This will help to improve your credit score. Pay every single bill on time and check your score in a year. If you don't add any new debt and keep everything paid off, I think your score will improve a lot. Congrats on pulling it up from 400K. Can I ask, though, how you've got 90K in savings but had such poor credit? Mostly, poor credit comes from not paying on time and if you had money in savings ,how did that happen? [ Reply | More
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General Topics 05.28.08, 04:57 PM Flag
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np: i'd go and get preapproved for a mortgage. there's a fee but you'll have an idea of what the banks will loan you. then start looking. the difference in mortgage can end up being a lot to pay but you'll probably still be looking in the same ballpark. [ Reply | More
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General Topics 05.28.08, 05:03 PM Flag
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honestly...we paid the debt we incurred due to my being very ill by selling our apt and banking the profit... [ Reply | More
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General Topics 05.28.08, 05:04 PM Flag
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That's a good story, from a credit point of view. My father told me you can essentially plead your case at the credit agencies. Find out if you can raise your score. You had a one-time hiccup, you made a sound decision, and you are on your way to a lifetime of healthy financial management -- and good health too, I hope. [ Reply | More
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General Topics 05.28.08, 05:06 PM Flag
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dh wants to wait...he is closing on a sale of property he has in europe and is getting about 50k euros for it...that will give us another 70k approximately to put own on a house [ Reply | More
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General Topics 05.28.08, 05:09 PM Flag
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I agree with the above advice to work on improving your credit instead of buying. But, the rule of thumb (for when you ARE ready to buy) is to get a mortgage of 3x HHI (180K for you), assuming no other regular payments, like credit card debt. Add your down payment, and that's what you can afford. [ Reply | More
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General Topics 05.28.08, 04:52 PM Flag
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OP: Buy Personal Finance for Dummies and Real Estate for Dummies. These are both excellent books. They will help you a lot. [ Reply | More
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General Topics 05.28.08, 05:04 PM Flag
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