When is the best time to buy a house?

Hello,

For any of you that have been through this...when is the best time to buy a house, since we have all these school loans. I have heard from some people not to worry about the school loans, because the interest is lower on them, and that we should just buy a house and work to pay that off. I mean, how are we going to ever get qualified with all this debt. We don't have anyone to cosign with us? Is it better to buy while in med school or residency? Thanks everyone for your input!

[mommax3]

It is hard to answer your question because there are so many variables -- but I know that we have never had any trouble qualifying for a mortgage and we have quite a bit of debt, not only student loans, but credit cards too. We bought our first house at the beginning of med school -- my husband had some money from his grandparents, so we had a *small* downpayment. I was working as a teacher then and we had no kids. Our house was nothing fancy, but our payment was much less than rent would have been. By replacing some flooring and painting, we updated it to the point that we made about $20,000 on it when we sold after four years. We bought again at the beginning of residency, and had no trouble qualifying for the mortgage even though I wasn't working at that point and we had racked up some student loan debt by then. We didn't make as much on that house, but at least we didn't lose any money. This third time, we had a lot more debt, but my husband was making a lot more, so no problems once again. All three times, we could have gotten a mortgage for much more than we actually did -- we took a good look at our financial picture and decided what payment we would be comfortable with before we went to the lenders.

I have heard that you should plan to live in a house for at least three years if you are going to buy -- we have always lived in our houses for four years at a time. Some areas of the country appreciate faster than others, though, so it may pay off to live in a house less time than that if prices are increasing in your area.

There are others here who have gone through this process for the first time more recently than I -- I am sure they will have good advice for you.

Sally

Our experience is somewhat similar to Sally's; however, we had no money to begin with to buy a house. My parents actually put the house in their name and we made all the payments, repairs etc. We were told by some financial person that our school loans would cap if they saw how much debt we had with a house. I have since heard that it wasn't true but we didn't take any chances at the time. We sold our house for about $27,000 more than we bought it for. We were able to pay back my parents for the help they gave in the beginning and put our down on our new house for residency. If you can swing it, I think it is worth it. You aren't putting money down the drain in rent. For us, it added a lot of security knowing we had a place to live for the whole four years.

It does depend a lot on where you live though and the cost of living. We didn't have any problems qualifying for a mortgage here with all our school debt (they don't even look at it!) and Russ' meager residency income.

Robin

house

We just bought a house this past summer. My husband is a first year med student. We knew that we would be in lexington for four years due to school so buying a house was in our best interest. When rent is approximately the same as a mortage would be on a house, then buy. We had no problems getting a loan. Many banks, including the bank we used, will give med students home loans because they are in med school in good standing. The banks look at it as an investment. We did not have to pay any down payment, but about 2,000$ in closing costs. I really don't know how much appreciation we will have by the end of the four years, but have have researched that question. A national average for the past fifty years houses have appreciated at about 5% per year, that is if you don't let it get runned down. So we figure that if our appreciation is only 3% per year that is still 12,000$. We have really enjoyed our house and I feel that we did the smartest thing. Look around at different banks and lenders to see if they have any special programs for medical students or residencies. Let me know what you decide!

Thanks so much

for all of your input and valuable experience. It seems that it can be done, and as far as I see it, I would rather pay a mortgage that I may get a return out of, instead of sinking money into rent. I will let you know what we decide to do! Thanks!

If you have decent credit, it's very easy to buy a house... esp. if you are an intern/resident! You can even do it with very little money down. You just need to find a broker who deals with residents... they are much more knowledgeable about 'future' income and the school loan debt.

I would suggest asking other residents who they used as their lender and go from there! Also, there are all sorts of links on the internet about physician loans...

Good luck!
Carey

P.S. Check the FAQ section out shortly as well... I am going to add some information on this topic! ....coming soon....

physician mortgages

My spouse is a fourth year medical student. I am a grad student in Atlanta and she has applied to family practice residencies there. We are trying to decide whether to buy or rent. Does anyone have experience, positive or negative, with the speicalized "professional mortgages" out there - mortages for physicians with no down payment, no mortgage insurance required.