Rent: $2,000
Utilities: $180 PEPCO, $110 Washington Gas, $165 City of Rockville, $75 Verizon
Childcare (for 2 kids): $2,000
Student loans: $185
Credit card payments: $280
Car payment: $317
Insurance (life/renter/auto): $185
Cellphone: $140 (for both)
Food: $800
Gas: $240
Savings: $125
Clothing/incidentals: $100

Take home after taxes: $7,000

Anonymous wrote:You can't assume that you will be able to refinance within a year to a better deal. What if interest rates go up?

Also, if you need to move in 5 years, the transaction costs may eat up any financial gain you accrued through owning.

Yes, yes and yes. OP - home owning is NOT the be all, end all of financial success. I'm sorry for your hardships, and you'll be able to get back on your feet financially, I'm sure. But owning a home at this point is not going to do it.

Why are your utilities so high? Can you break those down for us? How many square feet is the house and how much is each bill?

You can't assume that you will be able to refinance within a year to a better deal. What if interest rates go up?

Also, if you need to move in 5 years, the transaction costs may eat up any financial gain you accrued through owning.

Anonymous wrote:ALSO, your math doesn't add up. Borrowing 300k could easily make your mortgage payments $2000/month once you add in taxes and insurance. I see no way that you'll pay LESS than renting if you buy a $350k house. And you don't even have the $50k to put down.

I agree. Sounds like they are in too expensive of a rental. Need to move farther out and spend a year or two saving money and repairing credit.

ALSO, your math doesn't add up. Borrowing 300k could easily make your mortgage payments $2000/month once you add in taxes and insurance. I see no way that you'll pay LESS than renting if you buy a $350k house. And you don't even have the $50k to put down.

"The myFICO.com Web site illustrates the variation in loan pricing across the tiers of credit. The difference in the monthly payment for a $300,000 loan between the highest and lowest scores is nearly $300, which over 30 years adds up to more than $100,000. That's money better invested in your retirement account than spent in servicing a home loan."

Read more: http://www.bankrate.com/finance/mortgages/how-credit-scores-impact-your-mortgage-rate-1.aspx#ixzz39FS25VxD
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There is so much wrong here.
First, you have terrible credit. With only $12k saved, how do you think you will be able to have a 20% down payment and get a lender to finance the remaining 80%? Currently, you would be able to "afford" a $60k house. congratulations.

List your budget. Do you have kids w/ daycare expenses? Two incomes? Is there a 2nd job you can take on for a while?

Have you ever owned a home? Expenses like repairs, maintenance, replacing a washing machine, air conditioner, roof, etc come along and what are you going to do then.

Only buy what you can afford on a 15 yr fixed mortgage with 20% down. Figure out from there what you can afford.

Score of less than 680, I don't know of any banks or credit unions that would touch you.

Find a cheaper rental further out, save some money like you NEED IT, make a longer commute and keep your eyes out for a great deal. You will be renting for a while.

You need to be in a cheaper rental so you can save for a downpayment.

What is your HHI?
List your budget for all of your expenses.

Yep, that's what we are looking for. A townhome/condo under $350K in MD (Rockville, Gaithersburg, Silver Spring, North Bethesda, and Bethesda).

There's plenty of options out there.

At current rates, with $5k down, a $2000/month PITI would buy you a $300k house. Those are going to be slim pickings, old, and in suspect school districts (and you need to buy something you can be happy with for long term, b/c you will be there for a long time most likely).

http://www.zillow.com/mortgage-calculator/

Renting is far cheaper in DC area. Only buy if you are really sure you will stay put for like 10 years, and can benefit whenever they raise rates and interest rises.

I can't figure out your math at all. How much do you think this modest town home is going to cost? It sounds like you think your mortgage payment will be $1000/mo-that doesn't buy much in the DC area. Are you remembering to factor in property taxes/insurance/PMI? Those will add several hundred dollars a month to your payment.

Anonymous wrote:We need to figure out a way to buy a home here. Between the rent and the bills we pay we will never be able to save money until we move into out own home.

I know it sounds crazy but we pay $2000/month in rent and $400-$500 in utilities.

I have crap credit (591 FICO) and we have about $12,000 saved.

I want to see if I can swing buying a modest townhome that we can live in for 5 or so years and build some equity and not have so much money flying out the door to our landlord.

HELP!

So... what are you asking here? Are you looking for some way to buy a house without a down payment? Because no one seems to have that information for you. It's frustrating, but you have to live on the edge and save until you can afford a down payment on a home. It may or may not be more expensive than renting, depending on the type of home you buy. We live in a fairly new house and our maintenance costs have been very low thus far.

I find it hard to believe with your credit score that buying is less expensive than renting. In the same neighborhood? That doesn't add up. Well, it does in many cities, including an investment property I own, but not in dc. In all seriousness, spend a year or two saving money and improving your credit. If you're unable to save money with the rent you're paying, it may very well be that you need to move to a less expensive apartment.

Anonymous wrote:I'm assuming your stellar financial reasoning has gotten you to the point where you have a 591 FICO. Perhaps you should start listening to people who manage their finances more successfully?

The clear consensus is that you cannot afford to buy.

We are in this situation because our child became sick, nearly died, and we had a crazy high deductible AND had to see a bunch of out of pockets. It got out of hand, for a span of two months, over 2 years ago.

The debts are paid but are on the credit report for the next 5+ years.

At this point, according to the credit repair person we went to, nothing but time will repair it.

And we already pay all utilities, renter and flood and sub pump insurance, and $2,000 in rent.

Most of the townhomes/condos we are looking at have utilities included in the HOA costs and come with appliances included.