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To Buy or Not to Buy

I earned 65,000 a year and have $30,000 in credit card debt.  Should I pay off my debt before I even start the process?  Is it possible to still be approved with that amount of debt?  My credit score is around 700.  
  • May 18 2014 - Chicago
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Answers (16)

Yes I agree.  Once you are comfortable with your monthly payment then and only then is it a good idea to purchase a home.
  • June 10 2014
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Good Evening "To Buy or Not to Buy",

The time to buy is when you are comfortable with your monthly expenses and have room in your budget for a mortgage, home insurance, and taxes each month.  Plan on a small percentage of savings each month as well for emergencies or home repairs. 
 
Mortgage lenders work on a debt to income ratio as well as your credit score. 
Those ratios are based on debt, amount of income, and credit score. Consult a mortgage lender for this question. 

The market is definitely improving and prices in many areas have seen increases.
Ie: the prices in our local areas have seen increases in double digit percentages in some cases.

Wishing you the best,

D. Roberts, Realtor/CRS/Certified Residential Specialist
  • June 10 2014
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Always speak to a reputable lender and get pre-approved when considering to purchase. Weight out your options of buying vs. renting....sometimes it may be best to put off getting that home until your debt to income ratio is favorable for purchasing.
  • June 10 2014
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Profile picture for joe hoffman17
I would definitely recommend paying off some of that debt beforehand even if you don't take care of all of it before you start the process.
  • May 30 2014
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The interest rates on your credit cards is undoubtedly higher than current mortgage rates. That said, it would be fiscally responsible to knock out your credit card debt before taking out a mortgage. 
  • May 30 2014
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If you have money for a down payment under that debt, I would speak with a local lender.  They can see the whole picture and make the correct decision.
  • May 20 2014
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You should pay down that debt. That is 'way too much money to owe on your credit cards for your income.

All the best,
  • May 20 2014
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Profile picture for Evelyn S. Fred
Best to speak with a lender first and see what your credit will get you in buying power.

That said, If I were you I would pay down the debt first.  By doing so your debt to income ratio is lower thus affording you a more affordable/comfortable monthly debt (mortgage).

Good luck and let me know if you need lender referrals.  I work with a group of great lenders!
  • May 19 2014
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Before looking to get pre-approved, I would always ask yourself if this is a decision that is in your best interest. If it is, then I suggest looking into it further. However, if you believe that this can create more of a burden on you, seek to pay off current debts before embarking on new ones. 
  • May 19 2014
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Find a Lender and go get preapproved, you never know until you ask!
  • May 19 2014
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Profile picture for USMortgageRanger
Lets us first look at your total monthly obligation along with how much you are paying for rent. I am inclined to say yes as you will pay less for housing and can used the additional funds to immediately start paying off you credit cards.  I can be reach via my profile for a free no obligation consultation.
  • May 18 2014
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You could buy with your situation, however when I look at your income to dept ratio I would advise not at this time. I would suggest you make a plan with a time frame in which to pay off half of your debt. Once you have mastered this large task, then contact a Realtor and then make your goal to be a proud home owner.
I which you the best!
  • May 18 2014
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Profile picture for Matt Laricy
I would pay my debts before taking on new ones.
  • May 18 2014
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Profile picture for daveskow
It's possible .... Get pre-approved to know for sure
  • May 18 2014
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Qualifying with 30K in credit card debt is more about the monthly payment than the balances. The monthly payments reduces the amount of a mortgage you can afford. Speak with a lender before paying anything off so he/she can determine whether the credit card payments would stand in your way in terms of affording the property that you want.
  • May 18 2014
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You need to speak with a couple of lenders to see what you might qualify for. Then speak with a couple of agents to see what you can get for that $$$. Then decide if you feel ok paying a mortgage and paying off debt. My web site has some lender references.
  • May 18 2014
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