Thread: Decisions need to be made.

Ok I am a 26 year old from a city just south of detroit. My wife and I have a child due in late March. We are looking for bigger houses while the market is down and while we have decent jobs/income.
My job has contract negotiations coming up the first week in april which could very well end up in a strike. My wife is a teacher and is not yet tenured which means she will be receiving a paycheck in the summer months. We have been looking in a 2 areas for the past few months in which we would like to buy. We do have a decent amount saved up currently and only owe a bit less than $20,000 on the house we own now.
I am very conservative/cheap person and don't take any risks with my money, but I think in the long run I will be mad at myself if we don't buy during a great market. Ok time for the decisions, what would you guys do in a situation like this? Would you go out and bid on the houses even though income is not 100% certain during the next upcoming months? Or would you wait until the contract is over and there is income coming up.

Cliff notes. Read the last 2 sentences in the last paragraph for the questions

Depends on how much you have saved up. My rule of thumb is to be able to live 2 years on my savings account if the worst were to happened.

When does she receive her tenure in FL? Is it 3 years?



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Its 4 years in michigan, so she has 1 year. The house is listed for 128,000 but its a foreclosure so we would actually offer a bit let. We have a bit over 60 saved up, last time i checked. Also I am unsure if we should sell our current home or try and rent it out. I am almost positive we could sell it pretty quick for about 40,000 more than we paid for it.

I agree with nitroduck. You should have enough saved to go 2 years without a job. That includes all expenses such as insurance (home/auto), utility, food, gas, car loans. If you can do that then you can get the house.

Originally Posted by shupe

Its 4 years in michigan, so she has 1 year. The house is listed for 128,000 but its a foreclosure so we would actually offer a bit let. We have a bit over 60 saved up, last time i checked. Also I am unsure if we should sell our current home or try and rent it out. I am almost positive we could sell it pretty quick for about 40,000 more than we paid for it.

if i were you, i would pay off your currant house first, then sell it, if it does not sell then rented out but sell at first chance. Have 2 years worth of payments/land taxes and etc

How much is your currant house worth? how much is your new house going to be?

Rule No.1 - Never put yourself in a financial situation you can't handle. If you cannot afford an object with current income, don't do it. Future earnings do not equate to present income.

Stay in your current house, and pay it off. Then think about renting it out or selling.

We paid around 65,000 foreclosed. I have put a kitchen in, finished the basement and recently re done both bath rooms. In out area homes have been going for around 100,000, since I have done most renovations we haven't put a ton of money into the house. The new homes we are looking at between 115,000-160,000.
I agree with your No.1 rule. I figure I will never be a rich man because I never put myself at risk with my money. I just save it.