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So, it appears that we are going to be relocating to another state for a job. Up until now, when we have moved or been transferred, we have been lucky enough to either sell our old house within weeks or have a home buy-out, so we have not had to worry about carrying two mortgage payments until now.
We live in an area that was not very hard hit by the bubble, but enough so that we will be lucky to get back what we originally paid for the house three years ago. Since then, we have had to replace all of the mechanicals, appliances, and regrade the entire yard to head off water infiltration into the basement. Needless to say, we have sunk a lot of money into this place we'll never get back. I'm worried about selling due to the economy, the fact that we'll be listing close to the holiday time in a COLD, snowy state, and that the house next door (the only house for sale in the neighborhood, which is highly desirable) has been vacant for 16 months due to several factors.
In addition, I really do not want to have to rent when we get to the new location as we do have kids in school that we don't want to have to change schools again when we buy; we'd like to be able to move down with a house at least under contract so we can enroll them where they'll be going permanently. Which leads to my question: will we be able to buy another house before we sell this one? Since bank mortgage rules have changed since we bought this house, we don't know what is possible. What factors do banks/mortgage companies take into account in these situations, or must the total of both payments still be below the debt ratio requirements? Any other advice? Thanks!
Both mortgage payments would be counted against your income as well as your other monthly obligations such as minimum credit card payments, auto loans, student loans, etc...
In today's lending environment, you either fit or you dont... no exceptions made like in past years.
So, it appears that we are going to be relocating to another state for a job. Up until now, when we have moved or been transferred, we have been lucky enough to either sell our old house within weeks or have a home buy-out, so we have not had to worry about carrying two mortgage payments until now.
We live in an area that was not very hard hit by the bubble, but enough so that we will be lucky to get back what we originally paid for the house three years ago. Since then, we have had to replace all of the mechanicals, appliances, and regrade the entire yard to head off water infiltration into the basement. Needless to say, we have sunk a lot of money into this place we'll never get back. I'm worried about selling due to the economy, the fact that we'll be listing close to the holiday time in a COLD, snowy state, and that the house next door (the only house for sale in the neighborhood, which is highly desirable) has been vacant for 16 months due to several factors.
In addition, I really do not want to have to rent when we get to the new location as we do have kids in school that we don't want to have to change schools again when we buy; we'd like to be able to move down with a house at least under contract so we can enroll them where they'll be going permanently. Which leads to my question: will we be able to buy another house before we sell this one? Since bank mortgage rules have changed since we bought this house, we don't know what is possible. What factors do banks/mortgage companies take into account in these situations, or must the total of both payments still be below the debt ratio requirements? Any other advice? Thanks!
Hi Dolphin40,
Lenders will hold both mortgage payments against your debt to income ratio. One possible option is to rent out your current home to offset that mortgage payment. You'll need to go with an FHA loan on your new purchase in order for this to work.
I know you say you don't want to rent, but these days, if that's the WORST compromise you have to make for this to work, I'd say you are doing quite well!
We just went through this, you will either need to sell before you buy, have a signed buyout agreement from his company or be able to afford both payments. We moved during the summer and decided to rent because waiting for the old house to sell would have the kids starting school at the old location and transferring in the middle of the school year. If you will be transferring in the middle of a school year anyway, you may just want to wait for the house to sell.
You could look for houses in your new location that are for sale with the option of renting. Make sure it isn't one of those "Rent to Own" scams, but sometimes if a house has been on the market a while and you explain your situation some sellers may work with you...especially coming into the winter moths when home sale slow drastically.
You can always rent in the school district you plan to buy in. Having been bitten once by buying a home you couldn't keep long term, I'm surprised you're so eager to risk the exact same thing all over again.
You can always rent in the school district you plan to buy in. Having been bitten once by buying a home you couldn't keep long term, I'm surprised you're so eager to risk the exact same thing all over again.
It all depends on the area we're looking in: when there are several elementary schools and middle schools there is no way to guarantee you'll still be within a particular school's boundary lines.
As far as buying a home for the long term, all of our moves have been job-related (transfers, new companies, etc), and every time we get somewhere, we are in it thinking it IS for the long term. However, you just don't know for sure. Also, when your employer pays for all of your buying and selling costs (other than down payment), it makes it easy (or rather a no-brainer) to buy right away rather than waiting just "to see" if we'll actually stay somewhere. We currently own our 8th house, and have not yet had a problem selling nor had we lost money - until now. So, yes, we have been extremely lucky (or spoiled, depending on your particular POV) and now have to adjust to the new real estate/mortgage realities.
As far as buying again, we'll be renting until we sell our current home.
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