Tuesday, July 15, 2008

"I Can't Afford to Rent, So I Gotta Buy" WTF?

Yep, that was the essence of a recent email exchange! See below.

Initial email:
Frank, My husband and I are interested in this house. We are currently living with my parents until we can get on our feet. We just moved from Prince William county to Fairfax county/Loudoun county line. I saw this house and was very interested in it. Now I will tell you we (my husband and
I) do not have great credit and do not have very much to put down, like I said we are just getting back on our feet. My husband had a heart attack last year. I was wondering what kind of first time home buyer option we might have, considering our credit isn't very good? please e-mail me at [removed] Thanks Linda

Hey Linda, What about renting till you can save more? Buying with no money down
is possible but the fees are outrageous (yes sometimes they get rolled into the loan, but they are real fees).

Watch my video on the myths of buying. It is much much cheaper to rent. And no it isn't throwing money out the window.
It was my first video on youtube.franklyrealty.com

Linda's Reply:
Thank you for your time. We are not going to rent, because we will not be saving money that way, rent around us is way to high. Thats why we moved in with my parents because our rent increased over 1000.00 for a 2 bed room apartment. I have 2 small child who are looking forward to have their own house and their own yard. Thank you for your time and thoughts. We will find someone else who can help us.

Final Frank Reply:
Buying in this area is almost never cheaper, when comparing 2 identical places, sorry.
Even after tax breaks renting is 20 to 30 percent cheaper.

The thought that somebody is buying because they can't afford to rent blows my mind. You will find out sooner or later.
And anybody that tells you otherwise is trying to trick you put of money. Best of luck.

Final Analysis
Wow, isn't that amazing. Bad credit, no money... so the solution... buy a house! It is the level of entitlement that some people feel in regards to home ownership. It is a a shame. And sure enough, some shady agent will help them find a 'dream home"and they will be foreclosed on in 9 months.
Written by Frank


BaneFromMaine said...

I disagree. Rent is overpriced in my state. I rent a falling apart 1974 mobile home for $600 a month when I could get a much larger house and a mortgage payment of only $400 (real estate prices are rather low here) a month if I had better credit. I have poor credit in the first place because my income is low and my rent is too high and I can not afford to cover all my expenses. It has nothing to do with entitlement. I'd be perfectly happy to rent if it actually made sense but payments this high only damage my credit even further. A mortgage with a lower monthly payment would mean that not only would all my bills get paid on time, but I would also be investing in something I would own. No I can not just take on an extra job, my husband already works two low wage jobs and I work part time teaching piano lessons when I'm not caring for our kids, and no I can not find a lower priced rent, I am already in the cheapest dump we could find. I realize this is an old post but reading it really made me angry....

James said...

I agree with you treblegnome.

I'm in the same shape. Rent keeps jumping all around yet the places to rent are getting worse and worse. This must be one of the advantages of hard working Americans with Capitalism.

My fiance and I were about to get financed to buy a house at $450 a month until the housing market and credit crashed. Now we have to rent for $550 and up. We are jumping from rental to rental as the prices to rent never stay the same for a year.

Where are all of us poor people going to go?

Anonymous said...

There is far more involved in "owning/buying" a home than the mortgage, taxes and insurance. There is an incredible cost associated with maintaining, refurbishing/remodeling/keeping the house marketable. When ALL costs are considered, if you can't afford rent, you can't afford to buy or own your own home.

Anonymous said...

I know this post is super old, but I feel like venting... so idc if anyone reads it or not. Where I live (VA) EVERYTHING is based on credit. It's so frustrating. I can't afford to keep renting the this apartment because with electric, renters insurance, the rent, and all the costs of living we pay approximately $2,500 a month. We have 2 children, both under 10 years of age. We have bad credit and we can't stay here. Our rent contract ends on Sept. 28th. Here, in these apts you have to qualify each year and we didn't qualify for a 2nd year. Yet since our us bad no one will rent to us. Even if we were rich, no one would rent to us because of our credit. I'm worried and I don't know what to do. If there is anyone out there in the Prince William Co., Loudoun Co., or Fairfax Co. Areas of Virginia who knows some resources or help please let me know. melissa.angelove@gmail.com Thanx.