(Closed) Advice Buying Home While in Graduate Med School

posted 8 years ago in Home
Post # 32
Member
1747 posts
Bumble bee

@medbride:  I think you are smart…

In 4 years you will move for a job opportunity. With the housing market, I would not add any extra stress in unloading a house or dealing with renting it out. After graduation your student loans will kick in and you will still have to pay that 30 year mortgage rather you live there or not. 4 years is a short time, it’s much better than the alternative of paying 26 more years on a house you may or may not live in.  

Post # 33
Member
2417 posts
Buzzing bee
  • Wedding: August 2015

Although I understand what you are saying about throwing money into a whole, I think renting an apartment and having mainteance covered is much more practical in your situation. If you aren’t sure you want to live in Portland forever, owning a home for 4 years isn’t going to get you much equity and with this economy it may be extremely difficult to sell down the road. I just moved out and had thought about buying a house but realized renting made much more sense when I thought about repairs and utilities.

Post # 34
Member
3109 posts
Sugar bee
  • Wedding: May 2018

Everyone is just giving you the advice you asked for and you are all caps, bold yelling at us.

Do whatever you want as that appears to be what you’re going to do. Why are you asking for advice when you’ve made a decision already?

For the record, your wish to establish equity in 4 years is nothing but a dream.

Post # 35
Member
1695 posts
Bumble bee
  • Wedding: March 2012

@RawHoneyBee:  Also remember that it is harder to get approved for loans now than it used to be.  You need to show stable work history, low debt to income ratio and good credit. 

I just bought a house not too long ago.  The experience I had compared to my friends that bought several years ago is very different.  They wouldn’t even CONSIDER my husband’s income because he hadn’t been working at his job long enough (12 months).  So just consider these things.  Talk to a bank. 

ETA: My husband had been in the “same line of work/career (engineering) for five years, but because of being at his job for only one year, they didn’t include his income when approving our mortgage.

Post # 36
Member
3650 posts
Sugar bee
  • Wedding: January 2000

@RawHoneyBee:  So, with a mortgage comes the responsibility of paying it off.  You don’t have that with rent. YOu are banking on a condo riaisng in value. How much do you think you will have to pay for a real estate agent fee to sell it? Wha tif that wipes out all of the equity that you believe you’ll acrue in this short time? Will you have cash to walk out of the deak to pay it off?

Only if buying a condo is significantly cheaper that renting would I even CONSIDER this in your situation.

Condos traditionally do not rise in value at the same rate as single family homes, in the mdiwest anyway. On top of traidition, the condo market is overbuilt in many cities. I don’t know wher eyou are (didn’t catch that if you told us somewhere.)

Seriosuly re-think this plan and RUN THE NUMBERS of selling it. 

Post # 37
Member
3650 posts
Sugar bee
  • Wedding: January 2000

@RawHoneyBee:  How much of that $33,000 in rnet would end up in equity in your house buying plan? Do you know?

Post # 39
Member
1747 posts
Bumble bee

@RawHoneyBee:  You are getting feedback from experienced people. I am a Bank Manager and I have been for the past 7 years. I run a 70 million dollar location. I am experienced. You have at least one other poster here that said she works for the bank too. To be honest but not harsh this is all silly. I doubt if you will be approved anyway. EVERY bank asks for a minimum of two years tax returns and a current pay stub (within 30 days) to show your average income for the past 3 years. You sound a little unreasonable to want to buy a house on student loan debt. That’s not a job! You don’t even have work history. 12 months is not enough work history for me to loan 100k. I would personally turn the loan down.

Post # 40
Member
1695 posts
Bumble bee
  • Wedding: March 2012

@RawHoneyBee:  I was trying to tell you that I didn’t think you’d get approved for the mortgage, based on my experience. 

They banks we talked to were VERY strict about work history.  My husband has been in the same profession since 2005.  But he was in his most recent job for the last 12 months only.  They refused to even consider his income/credit, etc.  He isn’t even on the mortgage.  Just me. 

I’m not trying to dissuade you from whatever your decision will be.  Just wanted you to understand that.  Yes, the interest rates are low right now (we got a GREAT interest rate), but there are a lot of other fees that come into play that you need to consider–like insurance and taxes. 

Good luck.

Post # 41
Member
3460 posts
Sugar bee
  • Wedding: May 2012

@Soladylike:  @greenviolets:  Really?  Interesting. 

So for a personal digression, my husband is thinking of applying to new jobs, possibly in a new field.  He’s been in the same field for 7 years, current job almost 2.  I’ve been in the same field for 5 years, but was underemployed with a part-time position for 2.  By the time we’d apply (next spring at the earliest), I’ll have been in my job for over a year.

We anticipate putting approximately 50% equity into the home (all of our paid off condo plus some extra on the side).  The remaining 50% is less than 2.5 times both our annual income.  We would have another 30% of the value in investments we don’t really want to liquidate, plus maybe another 20% in retirement money.  (I also have student loans, less than 8% the value of the home.)  Are you telling me…that even with having these assets, we would not be able to get a mortgage unless Darling Husband stays at his job, and that it would only be calculated on his salary?  Wow.  We pretty much figured that by dumping that much equity into our downpayment (plus the fact that we have this much saved at our age) we’d be ok when we went to look for a mortgage next year.

Post # 43
Member
1747 posts
Bumble bee

@kay01:  Retirement assets do not count. If the amount financed is less than 2.5 times your income you should be fine. With really good credit I have seen loans approved for a little over 3 times your annual income. I don’t like to see people extend themselves too much but IF they have a financial plan and access to other revenue streams to pay for the home if one of them lose their income then it’s okay. An underwriter will ALWAYS request the LAST two years tax returns and your most recent paystub to see your YTD income. If DH takes a new job in a different field his income may not be stable and future income predictions based on his past performance is null and void in a new industry. Of, course this is my personal opinion blah blah blah and I do not in any way represent myself as a financial consultant or affiliation with any financial organization during my personal time.

Post # 44
Member
1747 posts
Bumble bee

@RawHoneyBee:  I wonder if I have only been working in my career for 1 year previous to full-time med school, but have previous continuious work.

I’ve stayed in the same line-of-work regarding healthcare. I was a CNA at 17, and worked for 2 years while going to school. I’m a nutritionist now, I previously worked at a gym but not for long due to family issues.

Before  that, I worked as a waitress, which was excellent pay for a few years! I’ve had long-term jobs ever since I was 14, and even before that if you want to count working for my dad’s business. I’m 21 years old now. Thank you for helping.

As far as my reported money that I make, I’ll only have 1 year of “good” starting out pay. I was only previously making approx. $20,000 (aside for waitressing which wasn’t reported to the T). 

Ok, based on what you said you do not have any continuous work history. Minors usually do not file tax returns. So from the age of 18 to 21 you do not have consistent work history on any job for more than 2 years. You also stated that with your waitress position you did not report your tips to the IRS (which is illegal so never say that again:0)). Your last 2 years tax returns are what a loan is based on. I read the post very well. So you will need to provide 2010 and 2011 tax returns with your YTD paystub to substantiate your 2012 income.

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