Date: Wed, 7 Apr 2004 10:36:29 CST
From: noreplysoccer@hotmail.com (Jim)
Newsgroups: misc.invest.financial-plan
Subject:  Re: The cart or the horse?  What would be the best strategy?
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gwagnr@earthlink.net (George M. Wagner) wrote in message news:...
> I am considering the purchase of a house in the next year, but the
> finances may be a problem.  I have a high debt/income ratio due
> largely to high interest credit cards, and other than the high debt
> have a recovered credit report from my youth.  I am trying to decide
> whether to get the finances in order now or look for a house/mortgage
> first.
> 
> My current home has ~50,000 - 60,000 equity and I am just about done
> an older "small" equity loan that financed my wedding.  Since I am
> thinking about moving, I'm afraid to take out a new equity loan, but
> am getting killed in interest that cannot be written off.  If I do get
> the loan, I'm afraid I won't get a mortgage (though with my current
> score I may not anyway).
> 
> Due to my child starting school, I am trying hard to move within one
> year to a good school district.  The options I see are the following:
> 
> 1. Get the loan, try to get an additional $10,000 to have on hand as a
> down payment (if I can stay in the 80% range to avoid MIP), look for
> home immediately while rates are low...
> 
> 2. Get the loan, only pay off high interest, wait 6 months - 1 yr to
> look for a home, risk high prices and high rates...
> 
> 3. Streamline my FHA mortgage hopefully to a fixed rate (currently
> 5.75% APR), refinance with additional $$ if possible, look immediately
> 
> 4. Try to get a house with existing debt load, handle financing all at
> once with new home.
> 
> I'm sure there are other creative ideas as well.  Any input would be
> greatly appreciated.  Thanks!


how much credit card debt at what interest rate?

what is the credit score?

how bad are the schools where you live now?- what city/state etc...

I would believe the opinion would be to pay off credit cards, then
move.  It will improve your credit score and help ratios- a win-win
situation.