Should I buy a home or should I wait?

[Fern]

If lenders have learned any lessons from the sub-prime fiasco, you would never qualify for a mortgage. You can't afford it right now. You have next to no savings and quite a bit of debt.

[Credit Girl]

I would suggest that you wait. I am not a real estate expert or anything but I think that if you worked a little while longer and paid off more of your debts that you'll be in a better position to buy a home. Also, just on a side note I saw your 24 hr expenses and I was just wondering if you ever thought about looking into Costco's offer with 24 hour fitness. If you are a costco member, they offer a plan with 24hr fitness that works out to be just under $13 a month which is much nicer than the $25 a month that I am also paying...

[JenniferG]

Thank you all for you suggestions. Just a Quick update I have decided to hold off at least a year, (probably two) so I can build up a sizable down payment and adequate EF.

The main problem right now that I am having is that my income fluctuates drastically. I get paid bi-monthly and my last paycheck was 2800 dollars the one before that was 1800.With such dramatic income fluctuations I find it hard to decide how much to allocate each month to paying off my auto/student loan, put towards an EF, and towards a down payment on a new home.

My mother and I are going to be visiting San Francisco in March so I also am sitting aside a little money from each paycheck for our trip. I have also been researching budget friendly restaurants and sites to visit while were there. Hopefully restaurant.com will run another 80% off sale so I can get some gift certs to use while were out there.

Since my original post I have paid my Credit card down and have $300 dollars remaining on that. I hope to have that paid off by the end of this month.

EF is now $750. ( Whatever money I get back on taxes will also go to my EF) Once I get 3k into my EF I will allocate all additional OT money towards my savings for a new home.

Checking account buffer $500

I haven't paid any extra on my auto or student loan.


Something else I have done to save money is open and ING account with sub accounts. The money is there if I need it but isnt as "liquid" as my primary savings/checking account. I have set up an automatic plan where money is withdrawn from these accounts twice a month.

ING accounts:
Emergency Fund (150 out twice a month) + additional OT money
New Home (100 dollars twice a month)
Vacation (30 dollars twice a month) *adding additional money ($50 a paycheck due to upcoming trip)
Furniture (30 dollars twice a month)
Car (30 dollars twice a month) this is mainly to pay for quarterly insurance in a few years I'd like to bump this up to 50 twice a month to help cover upkeep.
Christmas money (15 dollars twice a month)

I know this system isn't for everyone but this has been working for me, if the money isn't in my primary account I don't spend/miss it.

[jIM_Ohio]

Thank you all for you suggestions. Just a Quick update I have decided to hold off at least a year, (probably two) so I can build up a sizable down payment and adequate EF.

The main problem right now that I am having is that my income fluctuates drastically. I get paid bi-monthly and my last paycheck was 2800 dollars the one before that was 1800.With such dramatic income fluctuations I find it hard to decide how much to allocate each month to paying off my auto/student loan, put towards an EF, and towards a down payment on a new home.

Thank you for update

best advice for handling money and making it work for you, instead of you working for money is to do 2 things

1) set aside a fixed amount based on smallest pay amount ($1800 in your case)
2) take any overtime or bonuses and set them aside immediately.

For example in January I get paid 3 times. I am taking my extra paycheck and opening a CD with it once it comes on the 16th. It is a bonus, as budget only needs 2 monthly checks to pay bills with each month.

[JenniferG]

Thank you Jim. I guess I have been doing what you suggested in a way by having a set amount of money each money being automatically debited from my account into my online savings account.

[cschin4]

If you are planning to stay in the area and have a stable job , I think it is reasonable for you to start looking for a home. HOwever, be very careful not to buy MORE home than you need or can afford. YOu do not want to get yourself into a position of living check to check and just surviving to pay for your house. You want to make sure you have money left to enjoy life, to travel, eat out, buy somethings you want and so forth, go out with friends. You don't want to be saddled with an albatross of a home that is sucking up all of your income. And, owning a home costs a lot of money, you will need to buy yard equipment and so forth, mowers and many other things you probably haven't thought of yet.
Also, I am curious, why would you choose to buy a home versus just living in a nice apt or condo since it is just you? Or, have you always dreamed of owning?
Anyway, I do think you should go ahead and start looking but getting your finances in order. And, from this point on, nobody here wants to see any unpaid CC debt, you always need to pay those in full at the end of every month or don't use them. Good luck.