Stressed Out/Home Buying/Lease

[Cherokeekid88]

Ok.....So last October, My girlfriend and I moved out of our parents house and signed a 1 year lease at an apartment that is literally 1 mile from each of our jobs. Well, as you guessed it, our lease is about up. Our original plan was to have a house lined up to live in after our lease was up....well that hasn't happened yet. We got a letter today saying that we have 15 days to let them know if we are vacating and 30 days to let them know if we are renewing our lease.....needless to say that isn't enough time to find a house and know if we are gonna be able to buy it or what not....we really don't have the money for a down payment right now due to things that have come up (gf had to have the head gasket and new valve seals replaced on her XJ, and I had to have all four wisdom teeth removed as well as getting braces) and used a bug chunk of our savings....we had planned on getting engaged before we bought a house but again, that didn't happen.
We had planned on going to get pre qualified for a mortgage loan tomorrow morning but as I am aware they are only good for 3 months and would be a waste if we can't find a place to live before our lease ends.

so basically here are my options:
Option 1: Go get pre qualified, give our realtor our pre qualification letter and let her start digging for houses for us and pray that something happens in 2 months and that we won't go in over our heads with it. Also, won't have hardly any money for a down payment, so payments would be higher and pay on PMI longer.

Option 2: sign another year lease at our current apartment and really start saving like madmen and by next spring, really get the ball going and start the search.

Also, if we go to living here on a month to month basis, our rent would go up by $400 a month and is just not worth it. Also, living with my parents wouldn't work because they live in a condo with no room and her parents have a house but would be miserable.

My girl really wants to get a house, we have been together 6+ years and its all she ever talks about. I know that she is irritated and I really want a house but my gut instinct tells me that we need to wait and not rush into it.
I also understand that the housing market is a buyers dream right now, but I'm afraid of the dream turning into a nightmare and us regretting moving so fast into whatever we could get and then the housing market not turn around for a couple of years and us be stuck.

I am 24 years old and she is 23. we are both VERY new at this and I still think we are adjusting to living on our own with our own bills and responsibilities.

I know a lot of you on here might be going through something similar and I could really use some advice on what is the smartest thing to do.

Also, if we wait till next year, I will have my braces paid off and will free up some extra money

 

[Lurch]

my gut instinct tells me that we need to wait and not rush into it.

Go with your gut. You guys are YOUNG. Interest rates aren't going up any time soon. Wait a year, or two, save up for a nice down payment. Also, make sure you want to be going in on something as long term as a mortgage with a girlfriend...

 

[WB9YZU]

I would resign the lease.

Meanwhile, put that money away for a down payment.

Also, there is no reason you can't look into preaproval and properties.
It will give you both an idea of what you are getting into financially, legally, and what you are looking at in a house you can afford. Don't sign, just look.

 

[Lowrange2]

I couldn't agree more. Resign the lease and look for a house.

 

[Cottontail]

Option 2 is my suggestion...and my wife is a realtor in TN dealing with the exact same situation. A young girl (mid-20s, boyfriend, lease is up in August) and they have been touring houses for about 8 weeks and only have found fixers or HUD homes that aren't what she is looking for.

You could also check with the realtors, get on craigslist, pick up a magazine at the grocery store and look at finding a house to rent. Best of both worlds. You don't have a house payment, but you have the benefits of being in a house.

 

[Foothill]

Renew lease or rent a house. Continue to save for down payment. Housing market and interest rates aren't going to leave you in the dust anytime soon. Home ownership is a big responsibility. Renting a house is a good option.

 

[mako my day]

Well, I'll be........ Some good advise here!
Sometimes I wish I never bought, and just rented....Sometimes.

 

[jeannies_driver]

Sign the lease, you will ALWAYS find someone later to take it over once you leave if that's the issue.

Go see what your bank/broker will approve you for in terms of a mortgage. "Anyone" can get pre approved, but it might be at 20% interest with 50% down. Make them tell you what you can get.

If you haven't done it yet, go check your credit as well before the bank. Most mortgage brokers/Realtors will even do it for free in hopes to get your business. If your credit isn't over 620(?) anymore they won't even bat an eye when they tell you they won't give you a mortgage.

 

[tbburg]

Definitely Option 2. Don't rush into buying the house. Save for the down payment like yo said, and just deal with the fact that you may have to buy out your lease. It's expensive, but cheaper then going month to month, as you probably won't be getting out for at least 6 months, and probably clear through the end of the lease. (If you've never done it before, surprise! Closing a real estate contract can sometimes take 3 months.)

A bit of personal advice.
If you get to the point where you're buying a house with your girl, and haven't married yet, sit down with your girl and a good attorney and put EVERYTHING in writing. 'Sounds messed up, but neglect that little step, and break up, you(and she) will not only loose the house, but you'll both loose your asses as well.

 

[Cherokeekid88]

Thanks for the advice guys. We talked it over and we are DEF staying for another year and just gonna save like crazy. We already have a couple thou saved up, so it can only go up from here.

I think what I am gonna do is try and get a ring and get engaged and try to get married sometime next year that way, all is well with the world.....I really want to marry her, but we have just put it off because of the money situation.

Thanks again guys.

 

[Cottontail]

I think what I am gonna do is try and get a ring and get engaged and try to get married sometime next year that way, all is well with the world.....I really want to marry her, but we have just put it off because of the money situation.

If you really want to get married, do it. Money shouldn't be an issue. A marriage licence and justice of the peace is what, $100? You don't have to spend $20,000 just to get married with a fancy party and expensive clothes.

I cringe everytime I watch "House Hunters" and see a boyfriend/girlfriend combo buying a house. Before my wife and I got married when we bought vehicles we didn't even put them in both names. It was either hers or mine.

You are smart to rent one more year. Good choice.