Hi everyone--I just joined tonight and am trying to get a few answers for some financial questions I have. The question on this forum is about getting a "second" home/mortgage. Four years ago, we relocated for a job my husband took in a town 2 hours from our old home. We rented out our home we owned to some wonderful tenants who are still there and plan to try to purchase that home late next year. We were lucky enough that my mom had bought a home in the community we now live in but had decided to move in with her boyfriend, so we took over renting the home. Well, four years has been quite some time, obviously, and we would like to purchase the rental home instead of still paying rent.
Our original home is worth about 140-150K and we own 49K on it with those payments being covered still by the tenants, making our monthly mortgage $335 on that home, but like I said, they pay for that, taxes, insurance, and some extra towards the final cost of the home (in our contract we have it set that they cover all expenses and repairs in the home and we knock $ off the amount they will buy the home for at the end of the deal). Our current rental that we are looking to buy would be 65K (taxes a year run about $2100 here), which is all my mom wants for it. We curently pay $678 a month to my mom (funny figure lol), and I was just wondering if it was worth looking into to buying or if we should wait or getting our CC debt down before doing anything, but I know our monthly payment would be less than what we are paying now. I will be putting 5K toward CC debt here in about a month from his bonus.
Background: Two major events happened that put us in this position--one was a natural disaster which took a lot of our funds and also we are working very hard to get out of credit card debt that incurred when we were in school while having our first child and the economy tanked causing our scholarships to diminish and once we left to go back to our home, my husbands job was no longer there, we are sitting at about 28K in CC and 15K in a car loan. I only use 1 CC any more and it is paid off immediately, so the CC habit has been broken for a few years now, we just can't seem to catch up from what we did incur during that time. We do have student loans, but we are back in school, so we do not owe at this time on those (he is in his masters and I am getting my 2nd bachelors. He is looking at joining the army as a chaplain which would cover some of that cost and I will be going into public service which will get rid of a bit of the debt). Our current income is 60K with a possible job promotion (keep your fingers crossed for him) and I will begin substitute teaching here shortly, bringing in a couple hundred extra a month, but that won't be "reliable" money and will just be straight for debt. Right now, getting a full time job for me is not an option as we still have 2 little ones at home and daycare would cost more than my check would be anywhere around here.
His current scores: EQ 693, EX 662, and TU 666; I only have my EQ and it is 652
I have also been looking into a consolidation loan for the CC debt but so far no luck and would like to get from under our car and get something bigger as I need something, but not really having much luck there either and I am not willing to take on any more debt...any suggestions would be much appreciated! Thanks!
(Oh and for those wondering why we want to buy now after waiting four years--we have a grandparent who said if we don't decide we want this home, he would buy it from my mom and so we are feeling the "crunch" to make a decision, so that's why we are exploring the options now!)
