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Question: 30k income, no debt, can i qualify to buy a house?

(Posted by: wh002oo8 on 2009-07-01 17:58:39)

My husband and I have a short annual income. However we do have 2k savings on the side, and are expecting a baby on the way =]. We are wondering if we would qualify to buy a house of 120k or much less! We are looking for a single home detached 3bd 2bth. For closing costs, and down payment we are planning on using the 8000 tax rebate that president obama is giving out to first time home buyers, the way we are doing it is through CHFA, a lending dept in the state of CO. Any positive advice, feedback, or how we are standing?

Posted by: Jerry S on 2009-07-01, 18:03:25

I think the rule of thumb in some states is you can buy a house that is 2.5 times your income.

Posted by: J L on 2009-07-01, 18:03:33

I would say just do it, get a cheaper starter fixer upper though (nothing too bad just something with 2-3 bedrooms and smaller for now... then after baby gets bigger and you save more money sell the house and upgrade)...

Posted by: sassy2 on 2009-07-01, 18:07:24

You need to base your eligibility on net (take home pay) not gross. At 30k the most a lender will give you is 90k. You want 120k house then you need 30k down payment plus another 6k for closing costs. You do realize that is a loan you are getting from CHFA. You need to find out home much they are charging you for the use of the 8k Even with that you would have a total of 10k, Still not enough for a 20% down payment.

Posted by: KelKat on 2009-07-01, 18:21:29

If you really have ZERO debt (no car payment or any other amount going out every month) you can qualify for a monthly mortgage payment including Principal, Interest, Tax and Insurance of around 40% of your gross monthly income ($2500 per month x .4 = $1000). Some underwriters will go a bit higher. The principal and interest on a 120,000 home with 3% ($3,600) down will be approx $740 per month. That would allow you roughly $260 per month for property tax and insurance which will vary greatly depending on where you live. The only issue will be the fact that you need to have your down payment at the close of sale but you may not be able to get your rebate back for some time.