Reply to 670 score, 16k, want to borrow 700k

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[quote=Anonymous][quote=Anonymous]Is there any hope for me?
670 is lowest credit score. I anticipate one more score increase in august.
I have 16k I can put down. I earn 175k and have st loan car note and kid costing about 1700 month in payments.

I have a crazy high rent 4500k that ends Friday
(Yea) . If there is any hope of my being approved for a mortgage I’d like to stay month to month a buy no later than Sept. A move to would like eat 1/2 of my 16k . [/quote]

You may or may not manage to be approved. I can't speak to that.

And of course, there are many on DCUM who are very, very conservative financially, so you'll get a lot of "OMG NO TERRIBLE you need $200k cash to do that!!" on here, I'm sure.

I'm a bit more willing to take financial risks (we have a HHI $185k, and we have a big mortgage ($4k PITI) plus pay a lot for childcare ($2500, about to go up to $4k) which many on DCUM would say is CRAZY and doesn't leave us with much other money, but we are fine with it.

However - I do not thing this is a good move for you.

1) Closing costs in DC are very high. Honestly, I don't think you'd be able to cover them with your $16k. Even if you could manage to squeak by, you'll have literally 0% down.
2) You have no cushion. You need an emergency fund. You should be working up to 3 months expenses. I would not buy a house with less than that put aside. Things break when you own a house, and they need to be fixed right then - if the AC craps out in the middle of summer, what are you going to do? Or the hot water heater? Even a place that's pretty "turnkey" has stuff come up. 
3) It's clear that you do not have good money habits if you're living paycheck to paycheck on $175k. You need to learn to live on a budget and save. How are your retirement savings? Do you have any idea where you money is going? Make sure you're at least putting enough towards retirement to get your full employer match. Let's say that's 5%, that means essentially you're saving 10% for retirement, that's a good place to start. That leaves you with a take home pay of, what, roughly $9k? Break that up, and make some sacrifices to save:
$1700 - debt payments
$2500k - housing expenses (yeah, you need to rent a while longer, I'm also including utilities, etc)
$1k - food
$1k - emergency fund savings
$1k - house fund
$1k - clothes, entertainment, spending money, travel
$300 -  gas
$500 - other

This is just a sample - but you've got to figure out where your money is going and get a handle on your savings. If you're saving $2k a month, that means your expenses are $7k a month, and your emergency fund goal should be $21k. If you split your $16k in half, $8k for emergency fund, $8k for your house fund, in a year or so, you'd have a solid emergency fund and enough to cover your closing costs and put maybe a percent down. THEN you can think about buying a house.

Also - moving should not cost $8k!! This is what I mean by you need to get a handle on your spending - money is clearly just flowing through your fingers.[/quote]

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