You'll end up paying more than $30k in additional interest by taking a bad interest rate loan now vs. waiting for a good loan program to come around. If the home is selling for $100k, then why do you figure there is $30k in equity in it? The value is what people will pay for it, so if people are willing to pay $130k for it then it's worth $130k... if people are only willing to buy it for $100k, then the value is $100k. That isn't to say with a little elbow grease you couldn't improve the property condition to where it would be worth $130k. Values in a lot of parts in Ohio are having difficult sustaining themselves, not sure about Dayton, but for example in Cleveland and parts of Columbus there are blocks & blocks of foreclosed homes. I did a quick lookup of zip codes in Dayton and quite a few say they are in a "declining market", but there are also quite a few which aren't in a declining market. So rushing to buy a home today with a bad interest rate loan, if in a declining market, might very well eat away any equity you'd figure you'd have.
The difference in interest rates between non-conforming & conforming would be 7% (because of the sub-680 score and LTV over 70%) vs. 9-10%.
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