We need a house...how can we make this work?

luvbunnies42 · #1 (**permalink**) 04-17-2008, 01:42 PM

Hello, I'm a newbie to the site.I look forward to reading even more information and hopefully recieving some advice and valuable resources from the site.
My husband I have been looking to buy a house.Problem is they are either utter crap and need way to much work, either in a bad area, or over priced for what we want. We've recently found a house we really like in the area we like. We went and looked at it and it needs more work then we thought.It now has mold and some issues we can't do ourself.We also have a 15 month old and lack time to do this.

We're trying to find a way to buy the house.Curently not to flip but we need a house of our own.We know some of the work that needs done already and we know we are going to need contractors to fix up some issues before we could even move in. I was wondering if anyone knows of any loans or places for assistance with home repairs.We are first time home buyers.We don't want to get in over our heads but we really like this house and it was appraised 40,000 higher then they are currently selling it for.But, at the state the house is in there is no way they are still getting what that are asking for.Especially since there's no furnance, no appliances, and it's trashed. The house was foreclosed on and still even has a few things of the previous owners/tennants inside.

We even looked in habitat for humanities new program that helps families with home repairs.We barely qualify and are at the maximum you can make for help. We've been looking for houses for too long now and are out of space in our apartment and had lots of problems with this place. Most recently an apartment fire that we were fortunate not to lose anything due the firewall and renters insurance. The bottom line is we didn't qualify for FHA and some other assistance due to making to much as well as other factors.They say there is help out there for families like ours.But, where? I'm not jepordizing our family by living in the ghetto with drug deals, shootings, and all the issues down town.We live in the suburbs and thats where we plan to stay.We can't move further out either due to high prices of living with a major tourist attraction in the area.Property taxes are insane there.

Does anyone have any suggestions? Our family has been through crap lately and all we want and need is a house.

AllThingsPersonalFinance · #2 (**permalink**) 04-18-2008, 08:52 PM

Quote:

Originally Posted by luvbunnies42

Hello, I'm a newbie to the site.I look forward to reading even more information and hopefully recieving some advice and valuable resources from the site.
My husband I have been looking to buy a house.Problem is they are either utter crap and need way to much work, either in a bad area, or over priced for what we want. We've recently found a house we really like in the area we like. We went and looked at it and it needs more work then we thought.It now has mold and some issues we can't do ourself.We also have a 15 month old and lack time to do this.

We're trying to find a way to buy the house.Curently not to flip but we need a house of our own.We know some of the work that needs done already and we know we are going to need contractors to fix up some issues before we could even move in. I was wondering if anyone knows of any loans or places for assistance with home repairs.We are first time home buyers.We don't want to get in over our heads but we really like this house and it was appraised 40,000 higher then they are currently selling it for.But, at the state the house is in there is no way they are still getting what that are asking for.Especially since there's no furnance, no appliances, and it's trashed. The house was foreclosed on and still even has a few things of the previous owners/tennants inside.

We even looked in habitat for humanities new program that helps families with home repairs.We barely qualify and are at the maximum you can make for help. We've been looking for houses for too long now and are out of space in our apartment and had lots of problems with this place. Most recently an apartment fire that we were fortunate not to lose anything due the firewall and renters insurance. The bottom line is we didn't qualify for FHA and some other assistance due to making to much as well as other factors.They say there is help out there for families like ours.But, where? I'm not jepordizing our family by living in the ghetto with drug deals, shootings, and all the issues down town.We live in the suburbs and thats where we plan to stay.We can't move further out either due to high prices of living with a major tourist attraction in the area.Property taxes are insane there.

Does anyone have any suggestions? Our family has been through crap lately and all we want and need is a house.

Congratulations on being in the market for a home.

First, I would recommend that you are debt free before buying a home, particularly a first one. For me, debt free means owing nothing except your mortgage payment monthly.

Second, do not buy a first home that you will have to re-hab to make liveable. Get something that is move in ready. Your next home could be on fire or splitting apart in an earthquake when you are signing the closing papers and it would be okay. But for now, stick with something that is 100% clean and polished. You have a baby who doesn't need to be around alot of dust and mold. You are also short of time to affect repairs yourself. Where would you get the cash to do all of this? Not from your new home. It is not a piggy bank.

Third, you are wise to consider the taxes. All the extras (taxes, HOA, PMI, etc.) will lower your borrowing power.

Fourth, do not buy into the home mortgage deduction eutopia too heartily. It is an overblown falacy for most. Generally, you will only hear the lenders talking about it as a motivator to get you to borrow to your limits of income. They use it to sell the sizzle of home ownership without taking into consideration the tax implications for you. If you were to ask them tax questions, the same people who say "deduction! deduction! deduction!" will be quick to divert you to an accountant for competent advice.

Last thing, make a budget to include your new mortgage. You need to know how much more you will be spending for things that are not now issues. Trash, taxes that rise each year, surprise HVAC expenses, roofing, foundation work, all those kinds of things. With a house, it's all on you. That's why you buy a house that is 100% ready to go.

My wife and I have an older home that we enjoy tremendously. But, with an older home comes just the type of unforeseen costs that I mentioned. Right now, we are looking at about $10k to fix a problem in our basement. You don't want to move into your re-hab taj-mahal and need to put that kind of money in something.

Hope this helps.

All Things Personal Finance...And Then Some

luvbunnies42 · #3 (**permalink**) 04-18-2008, 11:22 PM

First, thank you for all the advice.Part of our problem is we can't afford a "new" home due to being middle classed income and my hubby being the main provider.The area we are looking at is horrible for housing at the moment.Many homes are over priced and are more then what my mom paid for her house 3 years ago and definitly not as big.Which is the smallest we can really go for a house.We also have a relaitor that is a friend of ours and no longer shows houses to many people.He has been great about helping us out and even telling us if the house is really not worth the time and effort.We also have an account who runs numbers for us.We plan to escrow taxes and other things in the mortgage payment.We have one more payment on the car and we only owe a little bit on the credit card. *Less then 3 hundred dollars*

I also wanted to update this a bit.Since I posted this we have heard from someone who we know that flips houses and his father (someone my hubby occasionally works for) owns a mold restoration bussiness. They are trying to help us out.My husband has known them for years and we were told there is another way to do this and they plan on doing the work that at the most should take about 2 months to fix the issues. We are looking into more and I'm leary about all of this.I don't trust people easily and am worried about not being able to get a house.We are running out of time though and our current apartment situation isn't working. Thanks again.When I know more I'll be back to ask a few more questions.

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