WWYD.....house

[frugalmama]

We've been trying for the last 2 months to find a new home, and it's not going well. Our budget is extremely low {$30k}, and most houses here seem to sell about $45k. Add in the fact that any house needs to be near a bus line as I can't drive due to vision problems, and it's become nearly impossible to find anything and get it before it's purchased. I really don't know where to go from here, and our household is about to come to blows over all the stress from house hunting.

 

FYI, renting is NOT an option. We have terrible credit & low income, which is all rentals here seem to look at. We live in a college town with a high amount of rentals. Rent would be equal or higher to staying were we are plus we'd have a much smaller space. Plus we are sure to have to pay for repairs as my mom is blind and tends to mark up walls with her wheelchair.

 

Option A is to buy a rowhouse for $12-$20k in a not great part of town, and I do mean really not great {I have lived in some rough areas but this is about the max I'd do}. We would have plenty of space, but no yard {not that it would be safe to spend time in the yard anyways}. House would be paid for, and we would go into this with the goal of it being TEMPORARY and put funds back into the pot for purchasing another house elsewhere. However if my mother passes away {she is in poor health}, it would likely become permanent.

 

Option B is to catch up the mortgage on the house we are currently in, and stay there. Said house has several roof leaks, is very drafty, and really not in good condition. I have concerns as to both termites and the foundation. We would have to take money from the housing fund to stay here, as our income is not enough to cover all bills {and yes we have lowered them as much as possible}. Again, if my mother passes we would have a loss of income and not be able to make ends meet. We could likely stay here for several years taking money from the housing fund to keep us afloat. We are on the Section 8 rent voucher list but have been told it will be 3-5 years before our number comes up.

 

Option C is to do some hybrid of the two - catch up the mortgage enough to stay here, but keep looking for another house. The longer we stay in this house, the smaller the house fund gets.

 

And I need to decide in the next 30 days what to do and do it.

 

I really don't know what to do.....but the stress of this is just making me sick.

[Impish]

I guess my question is, how can you sell the current house w/out doing the repairs?

 

Fwiw, here 30k would get you a vehicle. So, you're actually lucky in the sense that buying a home is even a possibility. So, you def have more hope and possibilities!

 

If you stay put, put the repairs needed in, and work on fixing your credit, you could end up in a far better situation, so I'd be inclined to stay put, and put those measures in place.

[Moxie]

Option A would be off the table for me. Safety aside, you would be stuck with a house you couldn't sell. All your money would be tied up.

 

I know you said renting isn't an option but owning is so expensive. Things wear out and you are on the hook.

 

Do you belong to a church? If so, could you look there for someone who would rent to you?

[lmrich]

I would not live in a unsafe area. Are you planning on walking away from your home that you owe money on? I would not do that either.

[Excelsior! Academy]

I believe in cash only. That said I will NOT compromise safety. I would rather live tight and pitch pennies until they cry than live in an area that is unsafe for my children to play outside. I know you said your credit is not great, but even a minimal mortgage is worth safe children and restful sleep.

 

Option 3.

[frugalmama]

Are you working with a realtor? I ask because I was just looking at zillow.com, and it appears that there are many houses in your price range that meet your requirements. I would think that a realtor would be able to point you in the right direction.

 

Don't give up. There's something out there for you.

 

We are working with a wonderful realtor, but I am doing most of the work myself. The big issue is finding one within walking distance of the bus line and in a decent part of town.

 

Since you're local to me - do you know anything about good parts of SA other than the NE side? I really have never been anywhere else in SA other than Downtown and the NE side. I know a little about the south side but not much.

[Wolfmeis]

We're in the middle of this now, so you have my fully sympathy. What we ended up doing (we walked from a crazy nice neighborhood) was buying a house in a safer-than-others area for really cheap because it needed a lot of work. We took "sweat equity" to a whole new level.

 

It used up the remainder of our housing fund, but it's going to be good when we get in there.

[ChristyB in TN]

I like to solve problems one at a time. I would:

*Catch the house up and stay put. Moving is expensive and at least you KNOW the issues with your house. I bet my cat that another $30,000 house will have more problems than the one you have now.

*treat for termites. It is only going to get worse if you don't.

*one repair at a time, don't get overwhelmed, just do one at a time.

*work on that income, not expenses. You have an income problem.

*don't let little things get in your way and don't try the "geographic solution" because the problems tend to follow you.

[elegantlion]

I really don't know what would be best for you. :grouphug: I don't know that moving to another fixer upper, even without a mortgage, is going to lessen the emotional load.

 

With poor credit and low income, financing down the road may be a hardship, so I truly understand about wanting to invest this money into some stability long-term.

 

I would consider the long-term implications of staying and fixing up where you are. Are you upside down on the mortgage or just behind? Could you sell it and invest your money into another home? Walking away from a home is going to negate your chance to get financing down the road as well, I think. I haven't looked into any financing lately.

 

As much as it seems like you must make a decision today, I would try to not think about it for at least 24 hours to clear your head, find some peace, and look for a solution.

 

My other concern is that even if you find the perfect home, negotiate a deal, and set up a move, can you close in 30 days? Bank owned homes can take longer to deal with, much longer in some cases. You could be 60+ days and that is heading into holiday season where everything runs slow.

 

You really are playing the odds if you are close to be foreclosed. I would not want to be evicted and have no place to go, even with money in the bank. Short term housing, ie hotel, can eat in your savings a great bit. Storage for your stuff can be expensive, and are you able to physically move things? Do you have help to move?

 

Lots of tough decisions, I'm sorry, I don't think there is a one solution fits all in this case. I do wish you peace as you make these decisions. :grouphug:

[LucyStoner]

Option B, in the absence of increased income is a a recipe for homelessness. You are in foreclosure on that home, right? Once you are caught up and have sunk the rest of the money into keeping up the mortgage payments, you would end up right back in foreclosure.

 

Option A seems risky as well but it will not leave you homeless down the line. Is the area truly unsafe or is it undesirable? There is a difference. I live is a dicey location but we are not moving because it is unsafe, just not very nice and one needs a high tolerance for drug dealers and petty crime.

 

Owning at least something outright, given your long term disability and income situation seems wisest. Can you relocate to an area or state where you can get a livable home for $20,000? Can you move to an area with more readily available affordable housing? In my area, a hh of 3 with disability payments could get a subsidized place on a busline in less than 18 months, maybe even 6 months.

Edited October 15, 2012 by kijipt

[LucyStoner]

*work on that income, not expenses. You have an income problem.

 

 

It is my understanding that the OP and her mother are the only adults and both are disabled.

[frugalmama]

Option B, in the absence of increased income is a a recipe for homelessness. You are in foreclosure on that home, right? Once you are caught up and have sunk the rest of the money into keeping up the mortgage payments, you would end up right back in foreclosure.

 

Option A seems risky as well but it will not leave you homeless down the line. Is the area truly unsafe or is it undesirable? There is a difference. I live is a dicey location but we are not moving because it is unsafe, just not very nice and one needs a high tolerance for drug dealers and petty crime.

 

Owning at least something outright, given your long term disability and income situation seems wisest. Can you relocate to an area or state where you can get a livable home for $20,000? Can you move to an area with more readily available affordable housing? In my area, a hh of 3 with disability payments could get a subsidized place on a busline in less than 18 months, maybe even 6 months.

 

It's undesirable and often unsafe. If I move there, one of my first goals will be to get my concealed weapons permit.

 

Relocating to another area is an option - but I really would hate to leave here. I've lived in this city for 11 years, know it well, and what places to avoid. I also have a wonderful thyroid Dr. here, and that is quite hard to find.

 

I would consider the long-term implications of staying and fixing up where you are. Are you upside down on the mortgage or just behind? Could you sell it and invest your money into another home? Walking away from a home is going to negate your chance to get financing down the road as well, I think. I haven't looked into any financing lately.

 

My other concern is that even if you find the perfect home, negotiate a deal, and set up a move, can you close in 30 days? Bank owned homes can take longer to deal with, much longer in some cases. You could be 60+ days and that is heading into holiday season where everything runs slow.

 

You really are playing the odds if you are close to be foreclosed. I would not want to be evicted and have no place to go, even with money in the bank. Short term housing, ie hotel, can eat in your savings a great bit. Storage for your stuff can be expensive, and are you able to physically move things? Do you have help to move?

 

Lots of tough decisions, I'm sorry, I don't think there is a one solution fits all in this case. I do wish you peace as you make these decisions. :grouphug:

 

We are not upside down thankfully, but just behind. We did fine until my dad passed away, taking with him his VA check. Then they cut my mom's Social Security and took medicare out, and now her check is equal to the mortgage, which doesn't work well.

 

Most bank owned homes here are closing in 5-10 days. I have a possible buyer lined up for my current home {he's buying under value, but above what is owed}. My backup plan is to go ahead and sell to him, but with an agreement that we are allowed to rent for X amount of time from him.

 

It is my understanding that the OP and her mother are the only adults and both are disabled.

 

This. My mother is in a wheelchair and blind, I have vision problems preventing me from driving as well as auto-immune issues. My daughter has ASD.

[elegantlion]

I

Most bank owned homes here are closing in 5-10 days. I have a possible buyer lined up for my current home {he's buying under value, but above what is owed}. My backup plan is to go ahead and sell to him, but with an agreement that we are allowed to rent for X amount of time from him.

 

 

 

 

This may be your best option. If you're seriously considering it I would move forward with this now. Once you actually go into foreclosure there will be a lot more fees presumably and a different department probably, and more headaches.

 

That would get you out of the house without a foreclosure, give you time to look for a more acceptable property without the rush of closing quickly.

 

 

I would think it would be to his advantage to have a renter that would be there through the holidays maybe and give you time to look at the beginning of the new year.

 

Again, best wishes as you make these decisions.

[Susan C.]

I noticed the house Kinsa posted has a window A/C unit. I am guessing that it costs quite a bit to run that in San Antonio? I am wondering if you could trade a higher electric bill into more house with central heat and air?

 

Also, I would get preapproved for a loan. With poor credit, your interest rate might be higher. It would help you to know what your new payment would be if you move.

[Caraway]

If your vision prevents you from driving, I don't think you should be carrying a gun. :001_huh:

 

:grouphug:

[ChristyB in TN]

It is my understanding that the OP and her mother are the only adults and both are disabled.

Okay, I am with you now. There are programs in place, you just have to find them. Start making friends, get on some local message boards, find out what is out there for you. I am in a group consisting of people from our local agencies, non profits, churches, etc and we exist to find help for people falling through the cracks. We get together once a month and share the issues we can't solve and see who can. Sometimes we go to a business or individual and just ask them for resources. We just found someone to pay for day care for a year for a 2 year living with a single dad not making enough to pay for day care but too much to qualify for aid. This sort of group may exist in SA, start with Facebook, then move on to churches, then start researching. I hope you find what you need! Lots of love to you. :001_smile:

[frugalmama]

If your vision prevents you from driving, I don't think you should be carrying a gun. :001_huh:

 

:grouphug:

 

I can see just fine for most things :D and you'd never know unless you asked that I have a problem. My issue is with telling depth / distance - I can't tell how far ahead of me a car is unless I can see pavement between me and it. I physically can drive, but have no business being on the roads in this busy city.

[TranquilMind]

frugalmama;4399570]FYI, renting is NOT an option. We have terrible credit & low income, which is all rentals here seem to look at.

 

 

 

Option B is to catch up the mortgage on the house we are currently in, and stay there. Said house has several roof leaks, is very drafty, and really not in good condition. I have concerns as to both termites and the foundation. We would have to take money from the housing fund to stay here, as our income is not enough to cover all bills {and yes we have lowered them as much as possible}. Again, if my mother passes we would have a loss of income and not be able to make ends meet. We could likely stay here for several years taking money from the housing fund to keep us afloat. We are on the Section 8 rent voucher list but have been told it will be 3-5 years before our number comes up.

 

 

 

 

I don't understand. You cannot rent because you say you have terrible credit and low income. So, how can you buy a house, since credit is a factor? You mention a house fund, so maybe you have cash for a house? Then how do you qualify for Section 8?

 

I'm really confused here and I know a lot about buying and selling.

 

I do know that you need to buy a house in a good area, not a bad area. You are throwing your money away if you purchase in a bad area. Location is everything. Buy the worst house in the best area.

 

Not sure if you can do any work, but if you can, look for a house that is being auctioned off. Those are some of the best deals I have found.

 

I'll read on now and maybe my confusion will be cleared up.

[TranquilMind]

 

My other concern is that even if you find the perfect home, negotiate a deal, and set up a move, can you close in 30 days?

 

What happens to the house you are in now if you do buy another? If you are behind on your current mortgage, you will get sued for the balance, and if I am not mistaken, the bank can come after the new house as an asset to cover its losses. It might even be fraudulent, since you put money into a new home while not paying your mortgage (unless it is not your money?).

[frugalmama]

I don't understand. You cannot rent because you say you have terrible credit and low income. So, how can you buy a house, since credit is a factor? You mention a house fund, so maybe you have cash for a house? Then how do you qualify for Section 8?

 

I'm really confused here and I know a lot about buying and selling.

 

I do know that you need to buy a house in a good area, not a bad area. You are throwing your money away if you purchase in a bad area. Location is everything. Buy the worst house in the best area.

 

Not sure if you can do any work, but if you can, look for a house that is being auctioned off. Those are some of the best deals I have found.

 

I'll read on now and maybe my confusion will be cleared up.

 

My mother has a small fund {$30k} thanks to my brother's life insurance. Section 8 here doesn't count things like this if you are on the wait list - it's only counted if you are receiving assistance.

 

By auction are you meaning the foreclosure auction? Or another type of auction?

 

What happens to the house you are in now if you do buy another? If you are behind on your current mortgage, you will get sued for the balance, and if I am not mistaken, the bank can come after the new house as an asset to cover its losses. It might even be fraudulent, since you put money into a new home while not paying your mortgage (unless it is not your money?).

 

We are hoping to sell it, but otherwise we will do a deed in leiu of foreclosure and give it back to them. The bank won't have any losses as the house is worth 85K, and we only owe 70K.

[sbgrace]

I would not move to an unsafe area. If you do you are very likely stuck there forever or you walk away and lose the money put into it. It may get worse and I couldn't/wouldn't be living scared.

 

I like the idea of selling to your buyer with a rental agreement from him for x time period. Outside of that I think I would stay put I think while keeping my eyes open for the right situation. I would take care of termites but the rest...well, you'll find that or worse in future homes probably? Maybe you can do cheap stuff to up the energy efficiency. Does your daughter get SSI for the autism diagnosis?

 

Do you have the house price in cash or you pre-qualified for a mortgage? If you have cash for the home you can look at foreclosure auctions. Around here you have to have cash up front so that eliminates most buyers.

[TranquilMind]

frugalmama: My mother has a small fund {$30k} thanks to my brother's life insurance. Section 8 here doesn't count things like this if you are on the wait list - it's only counted if you are receiving assistance.

 

So your mother is buying a house?

 

By auction are you meaning the foreclosure auction? Or another type of auction?

 

 

No, foreclosure auctions are pretty messy, with financial obligations to handle. I meant estate auctions, actually. They are paid off houses that are sold at auction because they need to move quickly. There aren't any heirs, or the heirs need to be done with the estate and close it.

 

 

We are hoping to sell it, but otherwise we will do a deed in leiu of foreclosure and give it back to them. The bank won't have any losses as the house is worth 85K, and we only owe 70K.

 

 

Well, there might be losses if there is massive deferred maintenance, and loads of work needs to be done to sell it.