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Rent. Do not buy. You are so far from being qualified to buy that it's not funny. Forget the mortgage brokers, use common sense.
Rent. Do not buy. After you do this commute for a year, you will NOT choose East Windsor as a permanent residence.
Rent. Do not buy. You don't have nearly enough cash, you have too much debt, you are choosing the wrong place to live.
Rent. Do not buy.
+1...just because you can make the numbers work per the mortgage brokers doesn't mean you should do it.
That is a ridiculously long commute. I was doing an hour and half to Manhattan one way from Morristown and that wore me out after 3.5 years. I moved to Jersey City recently because I was so worn thin from the commute.
If you are doing 3% down, you are paying more upfront fees, a higher rate and PMI. Save up for the 20% and if you REALLY need a house, I would even go as far as NOT paying down the student loan debt in order to do this (ut NOT the credit card). Even if it takes you a few years, the rates will not be that different figuring in you will get the better rate, no PMI. You pay 1% upfront and are required to have PMI for 5 years (at around another 1%) with an FHA loan. Since you will probably only keep the house for slightly longer than that, you are really paying more than 1% more for the entire loan than if you had 20% down (not to mention the difference in the stated rate).
Ask the person telling you that you can afford this how much they will make if you get a loan from them. Then you will see why it is such a good deal (for them)
I'm not going to address the finances other then the fact that buying a house without a 6 month cusion is not a good idea. You never know what curve ball life is going to throw at you.
I know you've said you've commuted 2 hours per day at one time and you were a bit miserable. You will now be losing another 5 hours per week with a 2.5 hour commute. I commute 3 hours per day. It's expensive and it leaves very little social time. I really would recommend that you rent for a year and do this commute before committing to ownership. It sounds like you don't have kids now. If you do have kids, you will never get to see them. I know from personal experience.
Once you buy that house you will have to hold onto it for a while or you will lose money if you decide it was a mistake. That's a big risk to take. Health and happiness are much more important than owning a home for the sake of a low mortgage rate.
Good luck. I know you'll like NJ better than Staten Island.
First, I would see a financial advisor, not a mortgage broker or realtor who has skin in the game
... you need to get rid of the 9K car ($750/month, I hope is two cars).
... work on your credit card debt. If your rating is 700+, you should be able to lower your interest rate
... I know your jobs are secure, but one of you should look for one that's somewhat close to the other. 2.5 hours each way will hurt your marriage and your kids (assuming you have kids).
Meanwhile, rent and go on a money diet and pay off the loans.... and SEE A FINANCIAL ADVISOR!
Student loans are not looked at as "Bad Debt" if he is up to date on his payments. It shows responsibility of the borrower to pay off high debts.. he has a 700+ credit score therefore it show he is credit worthy... he WILL get a good rate.
My credit score is 720 I only have a school loan of 16k, lease a car, and a 3k credit card and still didn't qualify for the lowest. The credit card is seen as bad debt. That should really be paid down first. MOrtgage lenders also gave me a range way higher than I know I could afford comfortably.
My credit score is 720 I only have a school loan of 16k, lease a car, and a 3k credit card and still didn't qualify for the lowest. The credit card is seen as bad debt. That should really be paid down first. MOrtgage lenders also gave me a range way higher than I know I could afford comfortably.
They did the same thing to me, especially Weichert's mortgage brokers (went to two different ones). "OH, you can easily go up to $xxx for a home, you have a good salary, you will qualify. " I went by monthly payment, and those monthly payments were way more than I was comfortable with. I bought late in life and I needed a number that would allow for the payments I have to make on loans for my daughter's college, and then that I could still make payments on in retirement. The guy at Wells Fargo LISTENED to me and ran conservative numbers with what I wanted to pay. Then I knew my price range and only looked at places within my price range, nothing else. Sure, there were wonderful, fancier, bigger places I would have loved, but I didn't want to be a prisoner of a huge mortgage payment. I found something, moved in two years ago, and I'm happy with my little place. Mortgage/taxes/insurance/maintenance are not much higher than my last rent.
They did the same thing to me, especially Weichert's mortgage brokers (went to two different ones). "OH, you can easily go up to $xxx for a home, you have a good salary, you will qualify. " I went by monthly payment, and those monthly payments were way more than I was comfortable with. I bought late in life and I needed a number that would allow for the payments I have to make on loans for my daughter's college, and then that I could still make payments on in retirement. The guy at Wells Fargo LISTENED to me and ran conservative numbers with what I wanted to pay. Then I knew my price range and only looked at places within my price range, nothing else. Sure, there were wonderful, fancier, bigger places I would have loved, but I didn't want to be a prisoner of a huge mortgage payment. I found something, moved in two years ago, and I'm happy with my little place. Mortgage/taxes/insurance/maintenance are not much higher than my last rent.
GOod for you!! I'm still looking and undecided on what area. Hopefully sometime in the next two years I will have that 20% down ready to go. I would consider the 3.5 FHA loan as well. I"m definitely not looking for anything extravagant either. I'd rather have a smaller place and know that I could manage it.
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