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We arent low income though? We both make decent salaries. Not great but over 100K together isn't bad is it?
Depends on how much houses cost where you are. Typical $600K starter homes that need a bunch of work might not be very affordable with only $18K down. With $200-$300K down it's doable.
There are a couple of things. You're being responsible and trying to have a good down payment to make sure you don't get foreclosed on. A lot of people buy homes not thinking about additional expenses, and they don't consider that being "pre-approved" for 700k on an income of 65k a year probably isn't a good thing.
The other thing is that you're right in the doughnut hole where you're not eligible for much in the way of government assistance but don't make enough to be able to bankroll a large down payment. It depends on where you live of course; 100k a year is a lot in some areas, while in others, a family making 200k is solid middle class.
Unfortunately another factor in borrowing for a house is credit score, people comfortable with debt can have better credit scores than people who pay everything cash.
We arent low income though? We both make decent salaries. Not great but over 100K together isn't bad is it?
If you are making a combined income of $100k and have only been able to save $18,000, you have other problems then not being able to afford a house. You have not learned how to budget your money. I work with buyers all the time who make under $50k combined income and can afford a modest house of about $175-200k at 3.5% down for FHA or 3% on conventional.
Where is all your money going? How many times do you eat out a week? How many times are you buying a $5 coffee at Starbucks? You need to sit down and really budget your life and then you'll see where the extra money is going.
I have friends who can barely fill their gas tank buy a home. We both have steady income and 18K down, and with down payment, closing costs, moving expenses etc....we could be out almost all of our money. How do people with no many afford it?
Because they spent all their savings closing on their house years ago. Now look where they're at
You need to speak to someone who sells mortgages like a mortgage officer at your local bank. Don't worry about what your friends do! They could be house poor. Not your problem. Sounds like you need to do some research on financing a home.
How is your credit? That is a biggy.
Meet with a Loan Officer and see what they can do for you with your income and credit.
Yes, some people become "house broke" because they spend all of their money on the actual buying of the home and do not realize that with a home comes taxes, repairs you cant budget for , and a lot of maintenance.
BUT buying a home is a lot smarter than renting, especially here in Portland. Renting a home, is basically taking a pile of cash and handing it right over to the landlord and and watching their bank account increase while yours just washes away.
It is throwing away hard earned money that you could be investing towards an actual home that is YOURS.
If you need a good loan officer let me know! As a realtor I have a few options if you need some help-
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