Thursday 11, March 2010
Which Is A Better Way To Finance A Home As A First Time Buyer With Poor Credit?
Photos were posted on 16 Nov 2009 at 7:35pm
I am a first time home buyer with poor credit. I would not get approved on my own. A friend has offered to either buy the home and I do a rent to buy contract with them or we could be co- owners. If we are co-owners would they base the approval ammount and intrest rate on his credit? If he has bought a home in the past but I have not- would I get the first time home buyer tax credit if we are co-owners?
It is better for you to wait until you have a down payment, You would be paying interest only and still have to pay property tax and repair any problems that happens.Find an apartment save your money until your credit is repairs. Then the home will be in your name only,
This may not be the answer that you want to hear, but if you have poor credit, you should not buy a house, regardless of tax credits. Your friend would not be smart to get himself into this situation. You should work on improving your situation. Home ownership is expensive. You have tons of start-up cost and without significant savings, you could get yourself (and your friend) in trouble quickly if you add to your debt.
Maintenance, appliances, lawn care, furniture, insurance, taxes, moving expenses, lock changes, cable installation, deposits, closing cost are a few of the things that need to be considered.
Just remember that if you do go thru with this it can backfire if you don’t keep up on every single payment on time for the next 30 years. That is quite a commitment and you never know what will come up in life- loss of life, medical problems, etc. You cannot for tell the future and to possibly ruin someone else’s credit would not be a good thing.
He would get the credit if he is the primary. Now if he decides to give that to you that is his decision, but I think if he is doing you a favor he should get that credit and not you.
I think this is a huge mistake and I think you should rent and save up your money and work on improving your own credit overtime.