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Old 06-14-2009, 10:16 PM
 
36 posts, read 93,434 times
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My wife secured a job in another city (Houston), and she was the better paid of the two of us. Pretty much a latteral move for her in terms of salary. I'm in the earliest stages of my own job hunt (now that we know it's Houston), but I consider myself quite employable. I imagine I'd have to be in town to do the interviews and such. We have about 20% of our target home value in cash. Our original plan was to do a short term lease, then buy once I do have a job, but it appears that the owners are not so willing to do month-to-month -- six months with increased rent is what they would like. Which scenario in your opinion would be the best use of our cash? Also, are they realistic? And, yes, we both have excellent credit.

- Rent for six months (approximately 10K), then buy with as much down as possible -- double move, $10K less for downpayment. Extended stay is quite expensive and not appealing, especially if my job search takes longer.

- Buy right away with as little down as possible (FHA), and use only my wife's income for calculations and the application process. What's the smallest % down these days? There should be plenty of cash left to feel safe at least a year or two.

- Do as above, but refinance as soon as I have the job and >20% in cash?

- Another option?


We've already visited the town, selected the school, the neighborhood and subdivision, and looked at the different types of houses, so it may be possible to do just one more trip to look at the house before we close. Also, the houses that we would buy are about twice the value of the houses that we would rent. Thanks

Last edited by djt79; 06-14-2009 at 10:58 PM..
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Old 06-15-2009, 10:15 AM
 
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It's possible that HOA restrictions preclude the homeowners from offering the home for less than a six month lease. In my HOA a copy of all leases must be presented to the mgmt company, and they can (and do) fine for short-term rentals.
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Old 06-15-2009, 04:56 PM
 
Location: Denver, CO
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I don't see how renting for 6 months is costing you $10k? Should save you money, since the rent should be cheaper or the same as the mortgage payments.

FHA requires 3.5% down.

I'd rent, who knows if your wife's job will work out in the first 90 days.....
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Old 06-15-2009, 10:26 PM
 
36 posts, read 93,434 times
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Thanks for your responses.


There's got to be a reason. We offered to cover their relisting cost (one month worth of rent), and we'd be taking over immediately after the current occupants move out, so I don't see how they'd lose, other than July may be a more favorable time to start a lease than September or October.



$1500 x 6 = $9000, plus moving expenses. Maybe an apartment would work for less. I'll call those in the school zone to check if they would do month-to-month, but if 3.5% down is possible, then we'd probably do that, and move directly into our own house, even if the rate is higher, then refinance at the earliest opportunity.
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Old 06-16-2009, 08:24 AM
 
Location: Denver, CO
3,133 posts, read 9,902,380 times
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Quote:
Originally Posted by djt79 View Post
Thanks for your responses.


There's got to be a reason. We offered to cover their relisting cost (one month worth of rent), and we'd be taking over immediately after the current occupants move out, so I don't see how they'd lose, other than July may be a more favorable time to start a lease than September or October.



$1500 x 6 = $9000, plus moving expenses. Maybe an apartment would work for less. I'll call those in the school zone to check if they would do month-to-month, but if 3.5% down is possible, then we'd probably do that, and move directly into our own house, even if the rate is higher, then refinance at the earliest opportunity.
I still don't follow your logic. If you don't rent, you still will have a mortgage payment, right? In the end, it's still costing you money either way if you rent or buy. I'm suggesting to rent a place that is cheaper than a mortgage payment would be, hence SAVING money and scoping out the area while you make sure the job situation works out. Housing prices aren't going to be going up anytime soon, so time is on your side.

Moving expenses aren't much, you could pay for it with the first month of savings (mortgage $1500, rent $1000=$500 savings a month).
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Old 06-16-2009, 02:21 PM
 
36 posts, read 93,434 times
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That's a possibility we're looking at right now. The reason we're considering buying at this point is that we've already selected the subdivision, and it's a matter of finding an individual property, and there are already a few that we like. It's going to be a very narrow search, either right now, or in several months.
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