Time to buy, 1 yr out, tax credit , but how?

[BRAUNSTEN82]

Me and the Gf filed a 7 and discharged july 08.

i got a 670 and her a 630

about 3k to put down

looking at houses in a area with houses selling for 70-80% of value. $50k-$90k

Really want to get something before Dec for the up to $8k tax credit.

So where should i go to get this done. Or what am i going to need to do.

I have a rent to own option (good but not great), but that doesnt get me the tax credit. I was told if i can get them to put my name on the deed with them that would qualify me for the credit. Or if i had a family member who already owns get financeing on a house for us and put me on the deed that would qualify for the credit.

I know it seem alot to do with the credit and alot does, seems stupid not to take advantage of free money and start building a home.

[Logan]

You won't get a loan only one year out.

Lgan

[BRAUNSTEN82]

what about the private lenders, or the other options i listed with the deed?

[oldhack]

what about the private lenders, or the other options i listed with the deed?

Private lenders -- aka, conventional -- are even more strict, and likely to require four years out of bankruptcy.
As for the $8,000 credit, everyone involved in the purchase MUST BE ELIGIBLE for the credit to qualify -- e.g., any co-signer or co-purchaser must also be a first-time homebuyer and using the home for a primary residence for three years -- and the law specifically disqualifies transactions between/among close family.

[oldhack]

what about the private lenders, or the other options i listed with the deed?

Private lenders -- aka, conventional -- are even more strict, and likely to require four years out of bankruptcy -- unless you have a huge down payment and, essentially, don't need a loan.
As for the $8,000 credit, everyone involved in the purchase MUST BE ELIGIBLE for the credit to qualify -- e.g., any co-signer or co-purchaser must also be a first-time homebuyer and using the home for a primary residence for three years -- and the law specifically disqualifies transactions between/among close family.

[BRAUNSTEN82]

i had a agent tell me i could get the cosigner or them get the loan and put my name on the deed, as long as it was me requesting the credit it would go.

So noone has got a loan with less than 2 years.

[Logan]

i had a agent tell me i could get the cosigner or them get the loan and put my name on the deed, as long as it was me requesting the credit it would go.

So noone has got a loan with less than 2 years.

Read this.

http://www.irs.gov/pub/irs-drop/n-09-12.pdf

[BRAUNSTEN82]

Thanks for the link

Well that says with a co signer i even if not first time buyer that i can still get the credit, i called and the officer wasnt sure about if a family member got the loan but i was on hte deed, so there are going to have Ms Glendening call me back today, and i will let everyone know what they say. Ofcourse the link is out of date, because its $8k now and a different repayment.

But again has anyone got a home earlier than 2 yrs after a 7

[monkatom]

I am working with a private lender ( hard money) not convetional. the interest rate will be high about 10% and it will include about 5-7 points. So yes you can get a loan out of BK sooner than 2 years but expect to pay high fees and a high interest rate. You may be able to do USDA if you meet income and location criteria and have a hardship reason why you filled I believe. BTW I was discharged May 08 and am going through a foreclosure now.

[BRAUNSTEN82]

I am working with a private lender ( hard money) not convetional. the interest rate will be high about 10% and it will include about 5-7 points. So yes you can get a loan out of BK sooner than 2 years but expect to pay high fees and a high interest rate. You may be able to do USDA if you meet income and location criteria and have a hardship reason why you filled I believe. BTW I was discharged May 08 and am going through a foreclosure now.

what lender and what type of down payment

[monkatom]

I have two mortgage brokers in San Diego that can help me so they say. I am also putting 50K down on a 150K condo so 33% down and my other factors like income, etc are great. I have not finalized anything as I am still in my home that is being foreclosed and want to continue living rent free. I may not even go this route as I have had someone offer to take out a HELOC for us which will be a lot better rate and zero closing costs.

[Flamingo]

Me and the Gf filed a 7 and discharged july 08.

i got a 670 and her a 630

about 3k to put down

looking at houses in a area with houses selling for 70-80% of value. $50k-$90k

Really want to get something before Dec for the up to $8k tax credit.

So where should i go to get this done. Or what am i going to need to do.

I have a rent to own option (good but not great), but that doesnt get me the tax credit. I was told if i can get them to put my name on the deed with them that would qualify me for the credit. Or if i had a family member who already owns get financeing on a house for us and put me on the deed that would qualify for the credit.

I know it seem alot to do with the credit and alot does, seems stupid not to take advantage of free money and start building a home.

Trying to buy a home for the first time, just out of BK, just to take advantage of a tax credit for which you probably are not qualified is a bad way to get yourself back into deep trouble. You will pay high fees, PMI, high interest even if you are able to get some sort of mortgage which just offsets any tax credit by far. You state above that it "seems stupid not to take advantage of free money and start building a home..." True, but but less than a year out of BK is not going to get you anywhere. You need to let some time pass, work hard on your credit by paying everything on time and not applying for too much credit in the next few years to show creditors that you are building a base for solid credit and will not revert back to the previous ways that tossed you into BK. There are folks out there who want to buy a home for the first time who have excellent credit and may even have a hard time getting approved for a mortgage in this economy.

Also, these homes are down in value and probably need a lot of repairs made to them. Where will you get the funds for repairs? More credit? You certainly cannot get a home equity line! You need to work hard over the coming years at your credit and save some money and then start looking at the housing market. The money you can save during that time will be your help and answer to a lot of things.

Best of luck to you!

[HHM]

Ahh, nothing like buyer frenzy to motivate a BAD decision.

[BRAUNSTEN82]

Understandable statements , but i filed bk because a business i own went south and had a 5 year lease at $4k a month, i had good credit before and have a good job now, but dont have anywhere good to live.

It seems stupid to rent, that rent money doesnt go to equity for me or toward paying on a home for me. It just lost money and equity for someone else. So to say i would lose money by buying doesnt make sense. Im losing just as much money by renting. If i have to pay 10% interest and only $25 goes to principle, that is $25 more equity im getting than ifim getting renting. I buy now with a crap rate and refi later. Still build a small equity and own the home and still get tax credit, which can go to either repairs or paying on principle. Sound smarter to buy now. I have a list of medium size homes on a acre of land that sold 2-5 years ago for $80-100k that i can buy from $45 -$65k, and appraise for 65-90k. military town. I pay $600 for rent for a house worth $60k a mortgages for 60k with a 10% has about a $600 payment.

[lrprn]

It seems stupid to rent, that rent money doesnt go to equity for me or toward paying on a home for me.

You are looking short-term, not long-term.

Let's take an example - you rent a house for $600/month for two years after your bankruptcy is discharged. That equals $14,400. Then you buy a house with a decent mortgage rate of let's say 6.5% for a 20-year mortgage for $50K. You can control your tax hit during the rental time by adjusting your withholdings. Total payout for the house - prinicipal and interest = $375/month; property taxes $58/month; homeowner's insurance $25/month for a total monthly payment of $480.00 for the life of the loan. So over 22 years, you pay $14,400 + $115,200 (total paid for the house over 20 years) = $129,600.

The alternative - buy the same $50K house now but at a 12% interest rate. Total payout for the house - principal and interest $550/month; property taxes $83/month; homeowner's insurance $25/month for a total monthly payment of $660/month. Over 20 years, you'll pay $158,400 for the same house. That's a difference of $28,800.

Overall renting first saves you $28,800 - not an insignficant chunk of change.

Obviously you are going to do whatever you think is best for your personal circumstances. But at least make the decision understanding that you are better off financially in the long run if you rent for two years first to get a better interest rate on the home loan.