Re: Want to buy my 1st house…Help - Posted by Carmen
Posted by Carmen on April 28, 1999 at 18:15:00:
Although I hear what you are saying, that you would like to get your equity out of the house almost immediately, this may not be as easy as you think. First, the refi companies really seem to base their decisions on your credit, and you probably won’t be able to go above 80% LTV without good credit and sufficient income. We have good credit, but since one of us is now self-employed, we still can’t refi over 80% and it’s been over a year - and that’s including the fact that we put down 10% to get in (pre-CRE days), and the comps on the homes sold since are about $20K above what we paid, since we bought a new home.
What I would do is separate my need for a home to live in from getting $20K to pay off my bills. I would concentrate on either a lease-option or finding a home to “take over” subject-to or by assuming a mortgage, as suggested below, for the home I want to live in.
Then I would concentrate on other areas to get my cash, such as flips, rehabs, etc.
At least, that’s what I would do. I would hate to get into a position where now I am the “motivated seller” because I have both an over-financed home and more bills to pay in a few months. Not only that, but your monthly payments would be substantially higher if you do manage to refi/cash out.
PS - whether and when you get married should not be based on your credit. Your credit file is completely separate from your fiance’s - it is possible for one half of a married couple to have rotten credit, and the other half have good credit - but only the person who applies for any particular credit has to show theirs. For instance, I purchased a home with my credit only (we were clearing up an ex-wife’s late payment fiasco off my husband’s at the time). My husband signed the mortgage, but not the note. The house appears only on my credit report. Of course, whomever is applying for credit has to have enough income on their own for whatever credit they ask for, whether it be a gas card or a house.