Profile picture for Benjaboo

Do I need to wait to save up enough money for a down payment/closing costs?

I am looking to buy a duplex to live in one side and rent out the other.  Thought this would be a great idea to pay down my debts while giving somebody a great place to live.  Only thing is, being a recent graduate, my debt to income ratio is high and it is hard for me to save up money for a down payment.  Besides trying to find someone to gift the money to me, is there any other options? 
  • September 21 2013 - Canton
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Be a Good Neighbor. Be respectful and on-topic. No spam or self-promotion! See our Good Neighbor Policy.

 
 

Answers (13)

Best Answer

Profile picture for Tiffany Tingle
Some areas provide grants for down payment assistance. A local Realtor should be able to connect you to a loan officer who has information on down payment assistance in your area. With it being so late in the year the grant money may have already been distributed but it is still worth checking. You may even be able to find out when new grant money will be available.
  • September 21 2013
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

It would be to your benefit to have a down payment and closing costs ready to go before you start the buying process. Keep in mind down payments can go anywhere from 3.5%-20% depending on the type of loan you choose.

If you have any other questions or need a loan please contact me through the information on my profile page. 

I hope this helps and good luck!

  • September 23 2013
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

[Promotion and hotlink removed by Zillow moderator. Please see our Good Neighbor Policy for information.]
  • September 23 2013
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

[Promotion and hotlink deleted by Zillow moderator. Please see our Good Neighbor Policy.]
  • September 23 2013
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

You need some money before going into any kind of a purchase.  I would never suggest not having any money.  The good part about your plan. Owning a duplex is a great way to save in the future.  I peronally used the strategy years ago and it allowed me to get a head financially.
  • September 23 2013
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Profile picture for Benjaboo
Thank you all for the advice.  It will go to good use! 
  • September 22 2013
  • 1Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Profile picture for wetdawgs
Many people think it is hard to save because at the end of the month there is no money.   That's doesn't mean that during the month they didn't enjoy a few cappucinos, meals out, smart phone services with an unlimited data plan and cable service for 1,000,000 channels.   

What's wrong with this picture?   If the money is there, you'll spend it.  If not, you won't.   How to get the money hidden?  Pay yourself first.  Put it in an account that you can't touch easily.  
  • September 22 2013
  • 2Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

If you have not saved up a down payment and at least some of your closing costs plus reserves.. you most likely are not ready to buy...
  • September 22 2013
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

ps

you left off 2 important pieces of the full picture....your income and credit scores!

before you even try to  find someone to "gift" you the money for a down payment  - you better find out if you'd qualify for the loan in the first place.
  • September 22 2013
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Ask and see if there is a USDA program in your area I is 100% down program. 
  • September 22 2013
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

High debt to income ratio will prevent you from getting a mortgage.

Many people think that a duplex means they are going to live for free.  That is not true.  While the rental income may offset your mortgage it may not cover utilities.  Unless the rental unit has it's own heating, water heater, water meter and electric meter you are still going to pay some of those utilities plus your own.  Then you have repairs and upkeep.

If you add your heat/electric/cable/water/sewer/garbage plus heat/water/sewer and garbage from the second unit - you may be right where you are now financially.

A duplex does not yield enough income.  You need a 3 unit with all utilities separate to show a profit.  You still have repairs and maintenance to worry about.

Even if you have to get a part time job - pay down your debt and save some money before you look to purchase real estate.
  • September 22 2013
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Other options?/
Yes

Come up with a plan to save money -  and stick to it.
Pay down those debts before thinking of taking on more debt.

Plan to save money - even if you have to take a 2nd job to do so..........if it's hard for you do to that - what will happen if you buy a home and it has a major problem? If you  don't have any cushion to fall back on, what would you do?

No matter how much you think it will cost to own a home...............it will always cost more!

You say you're a recent graduate.........you're young................plan for the future...........one day you'll get where you want to get!

Best wishes............
  • September 21 2013
  • 2Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Profile picture for Ofe Polack
The best advice I can give you is to meet with at least two mortgage brokers and seek their guidance.  Good luck!
  • September 21 2013
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.