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Answers (5)
- Troya C
- Contributions:2
Thank you to everyone who has answered thus far. We have decided that renting is too risky at this point. We are looking into either staying in the home or doing a short sale. Due to the house comparisons in my neighborhood dropping 35-50% we won't break even.
I appreciate the feedback and hope that we can move forward soon.
I appreciate the feedback and hope that we can move forward soon.
- William Dawes, "ewpdawes"
- Contributions:24
Good afternoon Troya! Thank you for using Zillow as a means of making an educated decision! There are many educated and experienced people here who can give you some 'food for thought.'
With regards to your desire to purchase another home: Can you afford another housing payment? If we can document that you have trully outgrown your current residence (increase in family size since purchased as documented by a birth certificate, etc) then you can potentially purchase another home for $0.00 down using the USDA Guarnateed Rural Housing Loan (if you are buying in an eligible area for this type of loan program). The key to this is documenting that you've outgrown your current residence.
Unfortunately, in order to have a 2nd FHA Loan you would need to document 75% equity in your current residence, which it doesn't appear you have...based on this a 2nd FHA Loan is out of the question. The only other option aside from USDA then would be a Conventional Loan.
However, the big issues here are: 1) Documenting that you've ougrown your current home (if you choose to go with a USDA Loan), 2) Verifying that you have sufficient income to afford two housing payments (with any Loan), and 3) As Andrew pointed out below, the risk associated with this decision.
There are a lot of variables and 'what ifs' in this situation. Andrew did a nice job of explaining a few of them. This is a decision that will require much consideration on your part as a family. You have to take into consideration 'what's the worst that could happen' and make sure you have a financial plan to handle all of these issues.
I wish you the best of luck and hope that you are able to move your family into a more comfortable living arrangement soon!
With regards to your desire to purchase another home: Can you afford another housing payment? If we can document that you have trully outgrown your current residence (increase in family size since purchased as documented by a birth certificate, etc) then you can potentially purchase another home for $0.00 down using the USDA Guarnateed Rural Housing Loan (if you are buying in an eligible area for this type of loan program). The key to this is documenting that you've outgrown your current residence.
Unfortunately, in order to have a 2nd FHA Loan you would need to document 75% equity in your current residence, which it doesn't appear you have...based on this a 2nd FHA Loan is out of the question. The only other option aside from USDA then would be a Conventional Loan.
However, the big issues here are: 1) Documenting that you've ougrown your current home (if you choose to go with a USDA Loan), 2) Verifying that you have sufficient income to afford two housing payments (with any Loan), and 3) As Andrew pointed out below, the risk associated with this decision.
There are a lot of variables and 'what ifs' in this situation. Andrew did a nice job of explaining a few of them. This is a decision that will require much consideration on your part as a family. You have to take into consideration 'what's the worst that could happen' and make sure you have a financial plan to handle all of these issues.
I wish you the best of luck and hope that you are able to move your family into a more comfortable living arrangement soon!
- Rudi Hofmann, "LUXURY HOME LOANS CA"
- Contributions:7435
Troya- I suggest listening to Andrew. I also do not believe you are in such financial position to safely take on this type of risk...... Best wishes, Rudi
- Andrew Adams, "203K Specialist"
- Contributions:9349
Personally think it is way too risky.
What happens if the folks you are renting to stop paying? Do you have enough assets to carry the property while you go through the eviction process?
What if they decide to damage the property on the way out? Do you have assets to repair the property?
No one knows if that would happen but it certainly could happen and unless you are prepared for the worst case scenario...it might be better to double up!
What happens if the folks you are renting to stop paying? Do you have enough assets to carry the property while you go through the eviction process?
What if they decide to damage the property on the way out? Do you have assets to repair the property?
No one knows if that would happen but it certainly could happen and unless you are prepared for the worst case scenario...it might be better to double up!
- Bob Willett, "SacRELender"
- Contributions:194
That might be a good idea, but there are many considerations that will go beyond the scope of this forum. You should get with a good lender in your area who is willing to explain all of your options considering your current and expected financial situation.
What should we do, second home purchase w/ FHA, upside down first home?
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