Question

I would love some advice. We are currently renting a 5 bedroom 2 story home and pay $2380 for our rent payment. Our lease is up in June and if we continue to renew another year they will raise our rent to about $2500. The house we are renting is okay. It’s HUGE for us and costs a lot of money to keep cool, we live in the Miami area so it gets hot. The company that owns it sucks. Says we have to pay for a lot of things out of pocket which is frustrating. We were looking at the possibility of buying a home when our lease is up. We found a one story home with 4 bedrooms and liked the lot and moved forward with the process. Well. because we have a lot of debt our DTI was pretty high. They didn’t say it was a no but it wasn’t a yes either. Then they offered us a different one story and said that if we were to go forward with it they would pay off anywhere from $12, 000-$14, 000 of our debt. No strings attached. They would literally right us a check at closing since we didn’t have a realtor that they would pay they would pay us instead. They are a major housing company so it’s not anything scammy. That’s huge for us. That would free up so much more money a month that we could throw at our snowball. Our mortgage payment would be around $2600 a month but we would also spend less money in our energy bill since we are cooling a smaller house. We would also need to come up with about $5000 to put down and we only have about $2000 left from our taxes that we were going to pay off some more debt. I guess my question is what would you do? It seems too good to pass up that incentive. We would finally be able to get some traction to really throw at our debt and work our snowball. Also if we are to buy this house for the first year everything is under warranty so we wouldn’t have to come out of pocket for anything major. ETA: The housing company just said they they would be able to take $2000 instead of the $5000 for the down payment. Also if we were to continue renting in this home the rent will increase each year. By the 3rd year we would be paying over what the house mortgage would be.  

Answer 1

Wow that is something I would do 100%

Answer 2

Seems silly to go to a smaller home and pay a bigger rent payment. I would find a cheaper place to rent even if it's tiny and pay down your debt with the money you save and then look for a house to buy and spend that huge chunk of money each month toward buying.  

Comments

@snub28 Unfortunately there isn’t anything in a safe area for less. Safety is my number one priority.  

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@tribasic that seems so crazy! Safety is very important yes, I totally agree. Our mortgage payment is $1200 a month where we live. Your rent is twice as much.  

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@snub28 I’m jealous. I wish it was that low here.  When we lived in California we paid $2508 to rent a 3 bedroom townhouse on a military base.  

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@snub28 I see that you’re from AZ, us too, but we used to pay 2k in rent and our mortgage is about 2. 5k as well.  

Answer 3

If it’s the same as rent I would consider it

Answer 4

Sounds like a no brainer! I would buy the house!  

Answer 5

Be careful that they are just not rolling that “free payment” into your mortgage. I have never heard of a mortgage company offering to pay off 15k of debt for free. There has to be something in it for them.  

Comments

@wade8826 We already asked that. That’s what we were afraid of and they said no.  

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@wade8826 They are still making money on the sale of the home. This would be the money that they would typically pay a realtor but since we don’t have one they are able to do this as an incentive.  

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@tribasic have you asked them what’s in it for them? No smart business just gives people 15k without some type of incentive. I would definitely make sure that you have a contract drawn up that says you are not responsible for paying it back.  

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Is it the mortgage company that’s offering the incentive or the seller?  

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@wade8826 The seller is offering the incentive. I’m assuming because this model isn’t their most popular they are trying to sell them all before they move to the next development.  

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@tribasic I would definitely make sure you have a written agreement to protect yourselves and before you put an offer in. I would hate for you to get to closing only for them to either not pay you or pay you less than they originally agreed.  

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@wade8826 Yeah we are definitely going to make sure it’s in writing. Of course!  

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@wade8826 yeah u need to see this in writing. it seems weird. I’ve bought and sold several homes and as stated above they don’t just give away $12-$15k. I understand what ur saying about the discount about not having realtors involved, but the point of not having realtors involved is to save that $12-$15k so it does seem a little fishy. so just be extra careful.  

Answer 6

But you just moved there a year ago & hubs is active duty AF? Is this your forever home? Try to find something smaller to rent & maybe take a financial Peace U class. Did I see that you have a Pelaton?  

Comments

@northeaster Gedert We moved to Florida in June. We’ve taken FPU. No the house we buy would not be our forever home but would be a house we would live in for the next 4 years. We have looked and there isn’t anything much cheaper in a safe area. Yes I do have a Peloton.  

Answer 7

Be sure to still have an inspection done and an appraisal. Title search. Still use a lawyer.