Member
spaceycj
Posts: 10
Registered: ‎04-02-2009
Where to begin? What can I afford? Help with Plan of Attack?
[ Edited ]

Okay - my husband and I are ready to start the adventure of home-buying (for the 1st time).  He is a stay at home parent to our 6-month old daughter (no child care costs).  I am an attorney (for a child welfare agency).  Husband has historically spotty credit history, no income, and only $2K in a truck loan.  We have no idea what his credit is going to look like, but plan on tackling that in the next week or so. 

 

Ideally, we want me (only) to be on the loan, and both of us to be on the deed.  I know that the truck may be used in calculating my DTI (since I'm 100% of the household income).  We live in Alabama in a very low cost of living area.  The houses we really like are listed in the 130s-150s.  We were thinking about a FHA loan and there are areas near us that qualify for a USDA loans as well.  We own a 2b/1b (700sq ft) mobile home which we will be renting for $460 a month to a friend (after paying lot rent we will net $350 a month).  We own the mobile home outright (through an inheritance), but don't own any land.  We hope to buy a "real" house in about 6 months.

 

Should we work on paying off the truck (husband's debt) first?

Should we pay off the credit card with the highest use ratio first?

Should we pay off the lowest balance first?

Should we pay off the highest interest rate first?

 

Here are my facts:

EQ Fico (10/13/12) - 689

TU Fico (10/13/12) - 692

 

Credit Utilization: 61% (yeah, I know its bad) ($15,700/$25,500 - mostly from school) $9K @ 11%, $1,700 @ 13%, & $5K @ 19.9%

one 30 day late in 1/2008 & one in 9/2006 (family member had a credit card in my name; I closed it when I found out about it.  I didn't prosecute, so the lates stayed on my CR).

Car Loan: $5K (Husband & Me) @ 4.5%

Car Loan: $2K (Husband) @ 7.9%

Student Loan: $47K (paid down from $60K) @ 3.5%

Total Debt Payments per Month (minimums only): $1,325


Gross Income Per Month: $4,300 (expect 10% raise by end of year)

Steady Employment for 5 Years in Field

Down Payment: $10K (savings + gift from my parents)

Emergency Savings: $1K (getting 0.95% interest)

401(k): $25K