ruca80
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Number 1, don't listen to Suze Orman as she is a failed Merrill Lynch advisor. My advice, if you only have $10,000 in the bank and have $10,000 in CC debt, keep paying your payments each month and save the most you can each month if you want to buy a house. If you pay off your debt and have nothing left in the bank, what would you do if you or your husband lost your jobs or had an emergency? You would end up going into debt further. Always, always have an emergency fund. Don't put all of your money down on real estate because when you need money in the future, you can't get that equity out without a cost! If you have the means to, pay a little extra towards your debt, but if you can't then don't worry. The national household debt average is over $70,000 and that is not including mortgages. You're in much better shape than most couples.!!! |
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urbugginme13
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Pay off credit cards. Then a bank/mortgage company would be more willing to take on your loan for a house. |
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FaZizzle
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Pay off the credit cards and build your credit up. If you have $10K worth of credit card debt, then you NEED to get that paid off first before you even consider buying a house.
If you went ahead and tried to get a loan/buy a house, you'll LOSE more money with a really bad/high loan rate and STILL have that credit card payment. |
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Shibi
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Assuming that your credit card interest is averaging about 18% and based upon your collective debt of $10K, I would pay off the credit cards first. Why? You'll actually save money (on the interest) and you should consider leveling out your debt before taking on more (buying something that you have to pay a down payment). |
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K.C.
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Pay the credit cards off |
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wine red
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credit cards. a down payment would lead to future expenses.
wait until you pay everything off to put a down payment on a house.
that way you don't have to worry about paying two separate bills.
and we all know how interest piles up. your best bet is to pay off your credit cards first.
if you have any money left over, save up until you get to 10k again, then put a down payment when you're debt-free. |
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debbiemaedke
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Check out the interest rate you are paying on the credit cards. If you are paying under 10% you may prefer to use the money toward a house. After you buy the house and get some equity in it, if the mortgage interest rates drop you can borrow against it and pay off the credit cards. When the debt is tied to your mortgage you can then write all the accrued interest off on your annual taxes.
You can always talk to lender and get a credit (pre-qualify) analysis done and they will tell you straight up if the credit card debt impacts your ability to finance a house. It never hurts to get as much information as possible beforehand.
Good luck and (maybe) happy house-hunting! :-) |
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King of all Lizard Kings. Beotch
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Pay off your high interest credit cards now! There is no reason to be paying that much in finance fees. |
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kennethbyrd98
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Pay off the credit cards, that will boost your credit score and with a high credit score you can then buy a home for no money down and take care of that problem as well espcially with the market not being that great. |
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krimsonknight
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It really depends on how soon you're looking to buy. Because you alread yhave a good credit score it isn't a crucial that you get your debt-to-credit ratio lower. However understand that if you're looking to purchase soon, the amount you owe will be evaluated when it comes to determining the amount and interest of your loan.
My wife and I in a VERY similar situation. We put our 10K in a CD and have used our regular monthly income to pay on our credit cards. We've now gotten 3 cards to a zero balance, and our scores are going up. |
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whizzbangdood
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Id pay off the cards.now coz they can get real stoopid with the ridiculous interest rates and penatlies they have these days. |
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WHISPER IN THE WIND
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credit card |
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The Revolutionary
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Pay off your credit cards. If you go and buy a house right now, you're going to be even MORE in debt.
See, man, that's why I'm NEVER getting a credit card. Everyone always gets themselves in too much trouble with them. |
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midget_ent
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You should definitely pay off the debt, since the debt will continue to grow due to interest. It will feel good to not have that debt looming over your head and then you can concentrate on getting a house. |
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Boo Too
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Pay off your debts first. Think of it like this, every day that you have debt is costing you more and more money. Pay off the credit cards, and then use the money you've been paying to them to save up for your down payment.
You'll make it there before you know it! |
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MtnMn
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If you think you can hold keep your debt down, I woud definately buy a house. |
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Michael A
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I'd get rid of those interest eating cards. Then you have better credit and you can get a bank loan for a home. Homes will go up in value a lot quicker than your credit cards will, but then you still have the paid off cards and they are so tempting. |
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Kimbermai
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Why don't you split it - and possibly save more, if need be, for the down payment? You should for sure pay off the credit cards becuase in the long run it'll ruin your credit and credit debt isn't a good thing to have going into a mortgage - it will kill you...so be wise...and don't rush into buying a house. |
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tonalc1
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Just piling on here. Always pay your debts first. |
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abdiver12
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Pay off the credit cards. The price of homes is still on a downward spiral and are not worth taking the risk on right now. Get rid of your current debt before getting yourself even deeper into debt, especially since the real estate market is no longer "a sure thing" anymore. |
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Polecat
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Credit! The interest rate alone is worth saving. |
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aj485
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If you aren't having any issues with the credit card payments, and the rates are reasonable, I'd suggest doing nothing with the money right now, even committing it to a downpayment. Homeownership, especially for the first time, can be expensive, and it will provide you with a cash cushion so that you don't have to take on more debt once you buy a home.
However, I would also suggest that in addition to having $10k available in the bank when you buy your home, that it would be best to have your credit cards paid off, too. So maybe wait a while longer to buy a house until you have both $10k in the bank and paid off cards. |
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Kathy
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You need to talk to your mortgage broker. With the debt...you may qualify for a lower loan amount for a house. And, you may have to pay a higher interest rate. You might be able to buy the house then take out a home equity line to pay off the credit card...that would be at a lower interest. Good luck, buying your first house is so exciting. :) |
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ProfessorC
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Pay off the credit cards BUT before you close the accounts look at what closing those would do to your overall credit score. |
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♥ThEoThErMe♥
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well i think u should put half of it towards ur credit cards is that all u have in the bank u dont want to spend it all at once |
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Maureen C
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Your best investment is owning a home. Buy a house ASAP! You can put your credit card debt into the mortgage which will probably be a lower interest rate then what you have now on your credit cards. Good Luck!! |
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Invisible
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Pay off the cards first, those usually have higher interest rates, the longer you take to pay them off the more money you waste giving it the the card company... |
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Bogart
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I would suggest getting some mortgage quotes with your debt paid off vs. using the money as a down payment.
Personally, I would dump the credit card debt and be done with it for good. It would be nice to just have a mortgage payment without having to worry about the extra debt. |
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mel s
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If you have excellent credit and will have no problems getting the loan with your credit. I would use it for the down pymt and closing cost. |
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Pengy
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Pay your credit cards to 30% of their limit,this will upgrade your credit score yet leave you with positive cash reserves. a win win situation. your credit score is up yet you have money in the bank |
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Dirtbox
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I'd suggest using it towards a down payment on a place of your own. |
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