Does it make sense to take out a student loan to help make larger down payment on a home?

Answers:2   |   LastUpdateAt:2012-10-27 08:02:03  

Asked at 2012-09-12 03:30:06
My husband and I have a combined income of $ 160,000 a year and are planning to buy a house in the Boston area . Housing is very expensive here , and a two bedroom apartment goes for between $ 400 to 450.000 . We currently have about $ 30,000 to be used for the down payment. My dilemma is that my graduate school is offering me $ 20,000 in student loans over the next year and a half (I'm on a full scholarship ) at the rate of 6.8 % . I do not need them for their expenses , but does it make any sense for them to take to help with the costs of houses ( down payment, closing costs , or even furniture / decor ) . We will not have 20% less , but we are close to not having to pay PMI for long. MedlinePlus MedlinePlus Besides that I have $ 10,000 in student loans ( mostly variable rate , just consolidated at around 2.48% ) , we are completely debt free . We bought the car in cash , and not expect to have to replace in the short term ( a Honda 2005) . Our debt-to- income is very low and our credit is great . I am also eligible for $ 17,500 in loan forgiveness for a few years , as I am a special education teacher urban . It is also important to note that we work very safe and there are no plans to make major changes , such as Special Ed teacher for Boston Public Schools . MedlinePlus MedlinePlus What do you think ? We would like to buy soon , to take advantage of the market and the tax credit .
Answer1tylikAnswered at 2012-09-27 10:43:03
Posted this before. Mortgage lenders do not like when you borrow for a down payment . Increases its debt and could lose the mortgage , then go for an FHA loan since all you need is the 3.5 per payment , but you still need cash 6% for closing costs MedlinePlus Why take a loan of 6.8 when you can get a mortgage for 5% MedlinePlus Talk to a mortgage broker and let them work all the numbers for you . MedlinePlus I keep thinking that their wages will struggle with monthly payments 4k MedlinePlus In addition , the monthly condominium maintenance required
Answer2laporishaAnswered at 2012-10-27 08:00:37
Schoolteachers in Boston can afford a mortgage of $ 400k ? Wow . I 'm in the wrong profession . MedlinePlus MedlinePlus Anyway , even with the extra cash loan you will not have 20 % down. You need $ 80,000 plus closing costs to hit the magic number . MedlinePlus MedlinePlus Do you think Boston has been done with the housing crisis ? Everything leads me to believe that we are near a bottom yet, and the actual background can not happen until the government stops giving away billions to banks. MedlinePlus MedlinePlus Personally, I'd keep saving my money and not try to get a house until I had a 25-50% down. But I am conservative and have no job security the Washington -backed government . MedlinePlus MedlinePlus Do yourself a favor and go talk to three or four different banks / mortgage brokers to find out exactly how much you need and what your payments . Please , please do not enroll in an adjustable rate mortgage or balloon payment as you have no guarantee that they will re -qualify to refinance in the future. MedlinePlus MedlinePlus Good luck
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