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[quote=Anonymous]I know you probably hate to hear this, but it doesn't sound like you are financially ready to buy. There is nothing wrong with renting, I promise.

1. Don't borrow First, there are negative tax implications. When you pay back a 401K loan you do it with post tax dollars, despite the fact that you paid into the 401K with pre tax dollars. Then when you take the money out during retirement you have to pay taxes all over again. Second, you obviously lose out on investment money, Third, risk of termination. What happens if you lose your job? The entire loan is due w/in 60 days. Since you have nothing in savings this would be impossible.

2. Buying with no savings is irresponsible. Houses are expenses. We are first time home buyers. Our first money into the house we had a plumbing issue (couple hundred dollars) and a car repair $800. Then we had to buy lawn equipment since we never had a lawn before $200 lawn mower + rakes, brooms, pruning stuff, weed killer. With an HOA you are likely going to be under more pressure to have your yard looking nice.

3. Honestly, I think that PITI is too large for you income. We make double what you do and pay $2500. Granted we have a kid in daycare, but I wouldn't personally feel comfortable wiht a higher payment. Are you going to be able to contribute enough to your retirment with that high of a PITI? If you borrowed from your 401K for the house you probably need to be adding MORE than normal into your 401K to make up for the loss investment income from the loan. Is this going to let you put money into savings?

4. A Higher down payment will reduce your risk of default. People that put down less than 5% have a 16% chance of default. Why? Because if one can't be fiscally responsible enough to save up for a larger down payment or aren't financially stable enough to have the ability to do so then they are not financially stable or fisically responsible enough to buy a house. [/quote]

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