700,000 Home, 200K paid on current home - DESPERATE HELP!!

MD4U · Joined: 07 Jun 2006 Posts: 1

Hello all,
im really glad i found this forum.

i saw this amazing home that i really want to buy.
i currently own really old house that is about $340K in value, and I've paid about $200K so far.

I saw this home that is worth $700K and at the moment im only able to pay approximately $2000 on a new home (i can rent out the old one because i dont want to sell it due to sentimental issues...)

i've looked into the following:
40yr mortgages, selling my old home and using its equity, renting it for slightly more than its current mortgage to help pay for the mortgage of the new home.

i am just about to give up, but i really think there is some way i can get this new home that me and my family are in love with. there must be a way...please advise...

thanks in advance
MD4U!

kevin · Joined: 29 Jun 2005 Posts: 3

Have you thought about selling your home, using that money for downpayment and then getting either a 45 Yr. Loan or a 1% Option Arm? How's your FICO score? Another thing you can do, is get 100% financing on the new home, keep the old home and make income from the rental. To get the lowest rate and payment though, you're best chances are putting a downpayment. On a loan of $500,000 you minimum payment would be $1608 no impounds.

Haplo · Joined: 20 Jan 2005 Posts: 2422 Location: Springfield, IL

You're setting yourself up for a *big* issue if you go that kind of route.

If you can only afford a $2k/mo payment then you should *not* purchase a $700k home, especially in a no-money down scenario. What are you going to do on that adjustment period with the option arm? How about the taxes? The taxes on a $700,000 home in certain areas around here could be as much as $15,000-$20,000.

I have an appointment to get into now, but I'll talk more in a bit.

The Wizard · Joined: 02 Apr 2006 Posts: 48 Location: So. Cal

THANK YOU
Haplo

It is nice to see a true professional that respects and cares enough about this person to tell them what will happen once the fun of having a brand new house wears off and reality sets back in.

Haplo · Joined: 20 Jan 2005 Posts: 2422 Location: Springfield, IL

Aha! Here's that link I was lookin for.. (Sweetems? What Link? chow)

But basically I said most of it previously. You're buying too much house and my bottom line question is what do you plan to do in 12 months? 24 months? 60 months?