unemployed but want a mortgage

**disneysteve** · 07-25-2009, 06:27 AM

I don't believe you can borrow from your 401k if you are no longer employed by the company, but I'm not 100% sure about that.

I can't imagine you would get approved for a mortgage with no current income. I also can't imagine any landlord would rent to you with no current income, no matter how high your credit score is.

And no, you can't buy a house with a CC. Even if that were possible, you don't have the outstanding credit to do it. Your 2 cards have a combined limit of 15K but you are already using $3,400 of that. Since you really should never charge more than 30% of your limit, you've only got room to charge about $1,600 more before it would start impacting your credit score.

**Joan.of.the.Arch** · 07-25-2009, 07:21 AM

I don't think you are going to get a loan to buy a house right now.

How did you use the FannieMae Homepath website to find house for $3000? The search function starts at $20,000.

**banditfist** · 07-25-2009, 09:36 AM

Without a job, there is not a bank in this nation that can/will give you a loan. You will fail to meet the most basic criteria for getting a loan: Being able to pay it back.

Rent till you get back on your feet. You are not throwing money away renting in this market.

**swanson719** · 07-25-2009, 05:41 PM

You're far better of to rent than to buy a house you think you can afford, still not be able to get a job, and then get foreclosed 9 months from now. You can't afford a house if you can't pay the mortgage.

A 780 score or not, the bank still has to run what is called a Debt to Income ratio. Right now, for you, it's 100%, because you have outstanding debt and no income. Banks cannot legally approve anything that puts you above 40% Debt to Income. That's not to say you can't get yourself there with credit cards, borrowing from retirement accounts, etc. Just that you cannot have installment accounts above 40% of your income.

You will always have a penalty if you borrow from your 401K, IRA, etc if you borrow more than the principle contributions. Even then, there are so many laws governing you can easily face between a 10% and 30% penalty for early withdrawal, on top of whatever income tax you pay on the money. Unfortunately, retirement account withdrawals do count as income if they are premature.

If you want to buy a house, that's up to you, but I would advise against it. You don't have the means.

**creditcardfree** · 07-25-2009, 06:32 PM

Please spend your energy obtaining a full time job. Think of it as the first step in obtaining a home at some point in the future. After the job, you need to save for an emergency fund and then a downpayment.

**maat55** · 07-25-2009, 08:36 PM

My guess is you are smelling the 8k and want a bite. You are in no position to buy a house at the moment. It will take more than you have just to pay the closing costs.

Owning a home comes with much responsibility, insurance, taxes, interest and upkeep will eat all your gains for the first several years. There is no reason to buy when are not ready.

You will need at least 3% down, 3 to 5k for closing, 3 to six months emergency fund and a job, just to start looking. You are better off living as cheaply as possible for as long as it takes to get there. Don't rush, just save.

**m3racer** · 07-26-2009, 08:24 AM

Major thread failure of epic proportions.

**parafly** · 07-27-2009, 05:43 AM

You have a long way to go before you are in a financial position to purchase a home.

**wincrasher** · 07-27-2009, 06:19 AM

You should really, really want a house - not just, hey I should get one because it looks like a good deal. There is alot of work and money to fix up or keep a house maintained as others have said above.

If you really want one, then you should get in a roomate situation now to cut your expenses, get a job and then save, save, save.

The $8k tax break is nothing - you can negotiate a bigger savings very easily considering the market. It won't get to be a seller's market again for several years, if ever again.

**xpirtdesign** · 07-27-2009, 10:36 AM

Car Capital

I agree when you purchase a home there is alot of responsibilities that come with it you should first find a full time job and live with a couple of people.

**Hypersion** · 07-28-2009, 01:19 AM

I'm starting grad school in the fall. I have excellent credit, no debt and over six figures in the bank but I'm unemployed. Instead of renting an apartment near the university I tried to buy a condo and have my parents sign as co-borrowers. But the loan office said I had to have a job to qualify even with my large net worth and my parents income and even larger network.

**wincrasher** · 07-28-2009, 03:58 AM

Banks are far more conservative now than in the past few years. No marginal cases will get approved.

Still a risky move for you. Consider you will have closing costs, plus the costs to sell when you are done with grad school (assume 2 years), you may not have much of a gain, if not a loss.

Consider that you are essentially in a transient mode right now. You'd do better to get a roomate or two and cut your rent down to a few hundred a month.

Aren't all your education expenses deductable anyways?

**Hypersion** · 07-28-2009, 11:51 AM

Originally posted by wincrasher View Post

Banks are far more conservative now than in the past few years. No marginal cases will get approved.

Still a risky move for you. Consider you will have closing costs, plus the costs to sell when you are done with grad school (assume 2 years), you may not have much of a gain, if not a loss.

Consider that you are essentially in a transient mode right now. You'd do better to get a roomate or two and cut your rent down to a few hundred a month.

Aren't all your education expenses deductible anyways?

I plan on keeping the condo after grad school. Right now with the market as it is it's cheaper to pay a mortgage on a condo than to rent a similar apartment. I could easily charge a roommate in my condo $700+ a month which would cover 80%+ of my mortgage payment.

I agree it's a risk but I think it's a good business risk with the market like it is.

Most education expenses are not deductible. Only tuition is deductible based upon income. Even if everything was deductible I don't see how that would effect my decision on buying a condo vs renting.

**anonymous_saver** · 07-28-2009, 12:16 PM

Why not work 20-30 hours a week and get a roommate. Then I might say it's okay to buy a home.

unemployed but want a mortgage