Posted on: 12th Mar, 2009 10:09 pm
my husband and i are newbies to all of this und till a few days ago, we were still far away from thinking about 'doing the big step' and moving into our own house - then, destiny hit us :roll:
that's the story:
my husband is a disabled veteran who left the army just a couple of months ago. recently, we moved backed to the states (we have been stationed in europe) and into the house of my sister in law. my sister in law is the one legally owning the house, though she is not living there or paying the bills - or the taxes. the house originally belonged to my mother in law who gave it the her daughter since she herself had troubles keeping the house financially running (water, electricity...) and the city was getting after her. mother and daughter agreed, to use the daughter's name, but let the mother live in there and pay the bills. like i mentioned before, that agreement didn't work out. long story, short end, the mother is now living in another state and doesn't wanna come back to live in the house. the house was empty and when my husband and i returned from the army my sister in law offerd us to move into the empty house and get situated. so we did. that was two months ago. my husband recieves va compensation 1700 dollars a months. i am his spouse and an immigrant. we are doing fine. my husband is looking for a job now, but honestly, he doesn't need to. i'd like to see him allowing himself more time to recover but hey... :roll: i start college in april and a part time job as a waitress. my husband has a poor credit score due to a former marriage. we are constantly working on it. right now, we still owe 5000 dollars, one 700 dollar bill and one 2800 dollar bill are recent collections. within the next two months though, we gonna recieve back pays (va, tax return, travel vouchers etc), all in all close to 6000 dollars. our original plan was, to pay our debts off, so we are just left with our car loan (13.500 dollars).
now here comes destiny. since my mother in law and my sister in law never payed taxes on the house we are currently living in, they got the notice today if they dont pay at least 5000 dollars of the 10000 dollars tax debts by the end of march the house is gonna be targeted for lawsuit and subject to foreclosure. now, my husband's sister offered us to purchase the house for 10 dollars... if we take care of the 10 000 dollar tax debts.
the house is beautiful. 2800 square feet on a 7000 sq feet lot. 4 bedrooms, 3 bathrooms, living and dining room etc. the current value is 112,000 dollars (was 170,000 :shock: ). it was built 1995. the house is fully paid. no mortage, nothing on it. just the 10000 dollars debt attachted to it. and we are already living in there. clearly it's an offer from sister to brother. my sister in law owns other properties and she just wants to get rid off the 'trouble house'.
hypotheticly, if my husband and i purchase the house for like suggested 10 dollars, and we show up at a banks office with a property worth more than 100,000 dollars and no mortgage on it, just our car loan and the 5000 dollars debts and our poor credit we're carrying around with us (not to mention there is finally an end to see)... does anybody have an idea, whether we have chances to get a loan to pay off the 10 000 dollar tax debt and maybe refinance our car loan in one step?
thanks for your answers :d
ps> my head is already spinning from the freaky american bank system... lol
that's the story:
my husband is a disabled veteran who left the army just a couple of months ago. recently, we moved backed to the states (we have been stationed in europe) and into the house of my sister in law. my sister in law is the one legally owning the house, though she is not living there or paying the bills - or the taxes. the house originally belonged to my mother in law who gave it the her daughter since she herself had troubles keeping the house financially running (water, electricity...) and the city was getting after her. mother and daughter agreed, to use the daughter's name, but let the mother live in there and pay the bills. like i mentioned before, that agreement didn't work out. long story, short end, the mother is now living in another state and doesn't wanna come back to live in the house. the house was empty and when my husband and i returned from the army my sister in law offerd us to move into the empty house and get situated. so we did. that was two months ago. my husband recieves va compensation 1700 dollars a months. i am his spouse and an immigrant. we are doing fine. my husband is looking for a job now, but honestly, he doesn't need to. i'd like to see him allowing himself more time to recover but hey... :roll: i start college in april and a part time job as a waitress. my husband has a poor credit score due to a former marriage. we are constantly working on it. right now, we still owe 5000 dollars, one 700 dollar bill and one 2800 dollar bill are recent collections. within the next two months though, we gonna recieve back pays (va, tax return, travel vouchers etc), all in all close to 6000 dollars. our original plan was, to pay our debts off, so we are just left with our car loan (13.500 dollars).
now here comes destiny. since my mother in law and my sister in law never payed taxes on the house we are currently living in, they got the notice today if they dont pay at least 5000 dollars of the 10000 dollars tax debts by the end of march the house is gonna be targeted for lawsuit and subject to foreclosure. now, my husband's sister offered us to purchase the house for 10 dollars... if we take care of the 10 000 dollar tax debts.
the house is beautiful. 2800 square feet on a 7000 sq feet lot. 4 bedrooms, 3 bathrooms, living and dining room etc. the current value is 112,000 dollars (was 170,000 :shock: ). it was built 1995. the house is fully paid. no mortage, nothing on it. just the 10000 dollars debt attachted to it. and we are already living in there. clearly it's an offer from sister to brother. my sister in law owns other properties and she just wants to get rid off the 'trouble house'.
hypotheticly, if my husband and i purchase the house for like suggested 10 dollars, and we show up at a banks office with a property worth more than 100,000 dollars and no mortgage on it, just our car loan and the 5000 dollars debts and our poor credit we're carrying around with us (not to mention there is finally an end to see)... does anybody have an idea, whether we have chances to get a loan to pay off the 10 000 dollar tax debt and maybe refinance our car loan in one step?
thanks for your answers :d
ps> my head is already spinning from the freaky american bank system... lol
Hi newjade
With the $10,000 tax debt and $5000 other debts, I doubt whether lenders would be ready to give you a loan. Moreover, you have mentioned that your husband's credit is not good. Lenders will not offer mortgage to people who do not have a good credit. For conventional mortgage, borrowers should have a credit score of at least 700-720.
I don't think it would be good option to buy the property. I can understand the property is beautiful, but keeping in mind your credit situation, I don't think it would be a good deal. You can rather rent a property to live in and try building your credit first and then apply for a loan.
Thanks.
With the $10,000 tax debt and $5000 other debts, I doubt whether lenders would be ready to give you a loan. Moreover, you have mentioned that your husband's credit is not good. Lenders will not offer mortgage to people who do not have a good credit. For conventional mortgage, borrowers should have a credit score of at least 700-720.
I don't think it would be good option to buy the property. I can understand the property is beautiful, but keeping in mind your credit situation, I don't think it would be a good deal. You can rather rent a property to live in and try building your credit first and then apply for a loan.
Thanks.
wow
newjade, i disagree with niicss' opinion that this purchase would not be good. what you'd need to do, of course, is to structure this deal as a purchase with a real purchase amount, sufficient to incorporate all the debts that are owed by your sister in law.
you cited "poor" credit, but that could mean a lot of things. there are lenders (still) who will work with poor credit, especially when the loan to value ratio (percentage of loan request in comparison with sales price) is low.
you could set a price that is reasonable and consider that your sister in law is providing you with a gift of equity in the property, which is totally realistic inasmuch this would be a transacation between siblings.
i don't know if it's at all sure, but i think you do have a chance to obtain a mortgage - rate might be high, but that ought not to deter you under the circumstances.
more information is needed.
newjade, i disagree with niicss' opinion that this purchase would not be good. what you'd need to do, of course, is to structure this deal as a purchase with a real purchase amount, sufficient to incorporate all the debts that are owed by your sister in law.
you cited "poor" credit, but that could mean a lot of things. there are lenders (still) who will work with poor credit, especially when the loan to value ratio (percentage of loan request in comparison with sales price) is low.
you could set a price that is reasonable and consider that your sister in law is providing you with a gift of equity in the property, which is totally realistic inasmuch this would be a transacation between siblings.
i don't know if it's at all sure, but i think you do have a chance to obtain a mortgage - rate might be high, but that ought not to deter you under the circumstances.
more information is needed.
Hmm, we had the same idea... buying the house, asking for a purchase mortgage that covers up at least the 10,000 Dollars tax debt. However, we estimated our chances to find a willing lender for that very low. Wouldn't it be wiser, to first transfer the house to our names, then go to a bank and ask as a legal house owner for a first time mortgage or debt consolidation? From what I researched in the internet I thought banks are more willing to work with houseowners than with people who own anything.
Right now, we are on our way to talk to sombeody who send my sister in law the warning letter. We need to figure out how much time we have left. If it is more than two months we actually have a chance to fix our credit first... not that it will effect our score, but we can at least documentate, that this is already taken care of. Like I said there is an end to that tunnel and we are still young... .
I come back with some more information. Thank you very much, NewJade.
Right now, we are on our way to talk to sombeody who send my sister in law the warning letter. We need to figure out how much time we have left. If it is more than two months we actually have a chance to fix our credit first... not that it will effect our score, but we can at least documentate, that this is already taken care of. Like I said there is an end to that tunnel and we are still young... .
I come back with some more information. Thank you very much, NewJade.
no, that method you mentioned isn't going to work with 99.9% of lenders i know about, as you would not meet new guidelines requiring you to have ownership for a period of time (seen 6 months, but lately i've also seen 12 months of ownership before you can go back and borrow cash). truly, i'm convinced that structuring this as a purchase and borrowing on that basis will work far, far better than if you try to take possession and then borrow.
will that lender that sent the letter talk to you? are you taking your sister in law with you, i hope?
will that lender that sent the letter talk to you? are you taking your sister in law with you, i hope?
and of course, i forgot that i had logged out, so yes this is my post:
no, that method you mentioned isn't going to work with 99.9% of lenders i know about, as you would not meet new guidelines requiring you to have ownership for a period of time (seen 6 months, but lately i've also seen 12 months of ownership before you can go back and borrow cash). truly, i'm convinced that structuring this as a purchase and borrowing on that basis will work far, far better than if you try to take possession and then borrow.
will that lender that sent the letter talk to you? are you taking your sister in law with you, i hope?
no, that method you mentioned isn't going to work with 99.9% of lenders i know about, as you would not meet new guidelines requiring you to have ownership for a period of time (seen 6 months, but lately i've also seen 12 months of ownership before you can go back and borrow cash). truly, i'm convinced that structuring this as a purchase and borrowing on that basis will work far, far better than if you try to take possession and then borrow.
will that lender that sent the letter talk to you? are you taking your sister in law with you, i hope?
omg... I swear I'm getting grey hairs right now. so we looked into our possiblities... to get a house worth more than 100,000 for 10,000. The 'must have' credit score for VA now to get you the eligibility to purchase a home is 580. My husband's credit score is exactly 580 (I have a perfect credit score in my home country,unfortunately not here as a fresh immigrant...). Friends of mine here (same age, husband is a disabled veteran) got recently denied the va request of loan support. But then again, the friend mentioned to have a credit score under 600 (no concrete number)und both of them have the reputation to spend the money with full hands, designer clothes, cars... I dont even know, how much they owe. Me and my husband, we dont even have a credit card, in fact we go shopping with cash in our hands to spend not more than we wanted to. I have no idea whether we will get the va's support und than of course, whether we will find a lender. But it is in fact a chance, we really wanna try at least ... .
Oh, it turned out the law firm handling our case is befriend with my sister in law's father in law who works as a paralegal for the county and who also has bbqs with the county officer who redirects and organizes lawsuits like 'ours' to the lawfirms. They cannot talk to eachother, but they can recommand... we still have time to find a solution, since my sister is not yet sued, and we might get some extra time thanks to half of my husbands family working for the county :roll:
not to forget, that we can pay off a big part of my husband's old debts within the next two months. all we need is a lottle bit of luck and time...
thank you so much for your advices. i am interested in all ideas especially since I still have to get familiar with the american bank businesses and no, my husband is not really a help. he wants to help but he is not the type of guy who gets comfortable with paragraphs, internet and a cup of tea if you know what i mean...
Oh, it turned out the law firm handling our case is befriend with my sister in law's father in law who works as a paralegal for the county and who also has bbqs with the county officer who redirects and organizes lawsuits like 'ours' to the lawfirms. They cannot talk to eachother, but they can recommand... we still have time to find a solution, since my sister is not yet sued, and we might get some extra time thanks to half of my husbands family working for the county :roll:
not to forget, that we can pay off a big part of my husband's old debts within the next two months. all we need is a lottle bit of luck and time...
thank you so much for your advices. i am interested in all ideas especially since I still have to get familiar with the american bank businesses and no, my husband is not really a help. he wants to help but he is not the type of guy who gets comfortable with paragraphs, internet and a cup of tea if you know what i mean...
I checked it again and again. 580 is the minimum you need to have to qualify for the va loan. What do you think?
We sent our request for eligibilty yesterday. It should be in housten by monday. they send the answer per email. Will the va support (if there is gonna be a support at all... keep my hopes low to not be too disappointed) help at all during these times?
My head is full of questions. I'm sorry if I'm getting annoying :?
We sent our request for eligibilty yesterday. It should be in housten by monday. they send the answer per email. Will the va support (if there is gonna be a support at all... keep my hopes low to not be too disappointed) help at all during these times?
My head is full of questions. I'm sorry if I'm getting annoying :?
okay... i take everything back. the minimum score for va and fha loan were raised in february to 620. hmm...
What if we have a co-signer ? :shock: would that make things much easier???
Things can get easier if you get a cosigner for the loan. You can speak to your lender about the option of cosigner and check if he agrees to it.
newjade, your score is what a lender is going to look at most, regardless of whether you have a cosigner or not.
if you are able to repay things in an extraordinarily speedy way, the possibility exists (not strong, but it's there) that the score could increase sufficiently. zeroing out all balances as rapidly as you can do it might just do the trick, but please note that i said "might."
timing is critical, so if the family involvement can stave off the hounds, so to speak, that's to your benefit.
and, oh by the way, i like that "paragraphs, internet and a cup of tea" reference.
if you are able to repay things in an extraordinarily speedy way, the possibility exists (not strong, but it's there) that the score could increase sufficiently. zeroing out all balances as rapidly as you can do it might just do the trick, but please note that i said "might."
timing is critical, so if the family involvement can stave off the hounds, so to speak, that's to your benefit.
and, oh by the way, i like that "paragraphs, internet and a cup of tea" reference.