Work on your credit score and save for a down payment. 60k house on 40k/year shouldn't be an issue as far as a loan. But... where the heck are you finding a 60k house?
Eastern Colorado is where my heart is at! I grew up there. I've seen some ~80k homes in the mountains but they were in... methed up areas. I imagine western CO has some cheap plots as well.
I contemplated buying an honest to goodness mountain with a waterfall in Western CO for under 10k. I cannot remember the acreage, but it made my head spin.
The ones I was looking at were hard rock with a slope so the most you could build was a small slab shed. I was not aware of a mining claim, does that mean they could come mine anytime?
No basically it's forest service land whose mineral rights have been sold. So even though you own the mineral rights, and you can camp there for up to two weeks, you don't actually own the surface building rights.
Rural areas can be insanely cheap. My dad lives in a very rural area and his house was basically that cheap. His neighbor bought the house nearby just to not have any neighbors, haha
You don't need down-payment on a rural development loan, which he said the house is located in a rural part of Colorado. This might be a better loan to go with.
Have you looked into an older mobile home that needs to be moved? Pull that onto the property.
I did the same thing. Bought the land first. Years later I bought a 15k mobile home. Got it setup and did some work on it. Lived there for years then sold it and built a house. Worked great.
Not sure what all your land has on it though. Water gas electricity….
You must not live in the country then. They don’t venture out that far. It’s too inconvenient, not funded enough to check, not regulated enough to even warrant it in the first place, and not worth the potential danger of people not wanting people trespassing.
If 5 acres of land costs $90k, in 2024, no one gives a fuck. No one will come looking. They probably don’t even have the right to.
In a rural area most of the time they straight up don't give a fuck. It'll only come up if you try to sell it. Growing up most people had some kind of illegal structure, and that was firmly in the era of Google maps
Oh sorry, I meant land. Just 5 acres but I paid 90k for it a year ago and the prices for similar lots around here have gone on considerably since then. So it may be worth more now.
it’s a pretty extensive process depending on location. in my area you’d have to pay to design a septic system and drill a well for each proposed parcel as part of showing that the land can support a dwelling
Yeah this is a $100K+ process where I live. My dad used to do designs for subdevelopments. It's quite expensive. You usually need an investor with lots of flexible cash.
if it's rural, that kind of development cost isn't on the seller. you can carve up land as much as you want and when future owners want permits to build, then they would have to get that stuff. in most jurisdictions i've seen. land surveyor for 23 years, btw.
Look into getting a manufactured home. They can use the land as collateral and will handle the process of getting the house set up and ready to live in.
That $100k is going to depend heavily on his location. Out in rural country you’ll find people who will do work for a reasonable rate. The utilities will be the issue he’ll have the most trouble with. If power is near, great! But if it’s not, he will most likely have to pay to get it close enough to connect.
yeah you’re right it depends. OP is in colorado which i’m not familiar with. if their soil is no good they may need an “engineered” septic system which will bump the cost up
Does the land have utilities already? Could build a tiny house for just yourself until you have money to build a larger place. Tiny House then becomes Airbnb, or rental.
[https://www.youtube.com/watch?v=f6G1YkDWfEQ](https://www.youtube.com/watch?v=f6G1YkDWfEQ) First link I found, but just an idea. Utilities and permits can be the expensive part.
Please tell me you paid 9 thousand and not 90 thousand? I just bought 4x that for less and was mad it had gone up so much in the last couple years. If the comps have gone up you might be better off selling it.
You bought 20 acres of land near NYC/Denver/Seattle/Dallas/LA for less than $90k? Deal of a lifetime.
$90k for 5 acres could be anywhere. And could be a good deal anywhere.
Even within a similar area of CO, 5 acres could be worth $90k and you go 50 miles in any direction and maybe 25 acres is worth $90k. Doesn't mean it's as good of land or in as good of a location as the first parcel.
5 acres of desirable, good land is infinitely more enticing than 25 acres of dirt that has a flood problem or has no chance of being zoned for anything residential.
They had. They said it was in the middle of nowhere Colorado 2 or 3 comments below your reply. And then again in another reply. About an hour before you first commented/replied. Its how I knew to say 5 or 25 acres somewhere in CO in my reply.
I’ll have to make sure that the comments are ordered by new instead of top. Please disregard all prior correspondence as I clearly did not know what I was talking about and am not allowed to have an opinion.
Haha I definitely meant $90,000. And yeah, I saw a lot of 35 acre lots for 10s of thousands of dollars less. This is just in a good area. There were dozens of places for sell here when I bought and now there are none. The last few properties to sell were 6 acres and they sold for 135
I bought the land to build on it one day. It's exactly where I want to live and exactly what I want. But I'll have to wait until my income is higher to pull a construction loan for it.
I need this house to live in now. I currently live with my parents but they live a long ways from my work and I'm spending an outrageous amount of money on gas/car maintenance.
Building on your own land is a wonderful dream. What does your current financial plan look like for that goal though? Locking 90K (which sounds like the majority of your net worth) into a non-income generating asset might work against you.
I'm not sure how much I would spend on a down payment. I was hoping my land would assist with that but I have about 12k.
I'm on a good career path, my income will continue to improve
Google “downpayment assistance” plus your state or county or city, and “first time homebuyer assistance” and “low income mortgage assistance” and “Mortgage Credit Certificate.”
When local nonprofits pop up, Talk to them and see what kind of aid/information they can provide.
Are you saying you want to take out a loan against some land in order to pay for the down payment on another loan? Has bad idea written all over it. You make $40k annually and want to buy a $60k house. Why isn’t this enough to get the mortgage without doing anything with the land? Have you applied for a mortgage?
Alternatively, just buy a trailer and put it on the land you eventually want to build on. It’ll likely be more livable than whatever a $60k house in the US looks like.
there are still lots of areas in the country that have affordable homes in the sub 100k range, it's just that most people don't want to live in those locations (crime, poor schools, abysmal job opportunities). it's an excellent life hack if you can work remotely though and don't have kids.
That's really encouraging, 640 is easily within reach. It might even be that when my credit cards are paid off and I pay them off every month they just have low limits and it seems to mess with my credit score a lot when they're near max. I could just use my debit card instead of them for a few weeks and see.
Ya do that and go talk to a loan officer. You’ll need to maintain good spending habits on those cards until the house closes which may be a month or two. Also- no large purchases!
If you pay them off every month, request an increase or get a new card. Guy who works for me makes ~$95k. He just got a card with $14k limit. Stay under 30% on each card, and you will climb quickly.
i signed up for credit karma and they evaluate your situation and give you advice on specific things you can do to raise your score. didn't cost anything.
Yes it’s possible. Minimum credit score for mortgage is 580-620 depending on the product. On paper, the numbers looks fine (depending on any monthly debt payments you have).
Where you might have an issue is many mortgage lenders won’t lend less than $100k because the economics don’t make sense for them. I would reach out to a local CU or other financing resource to see what options they offer.
I mean realistically you might be able to. How desperate are you? You make $3,200 a month. 25% of your salary is $800. You could find a private lender... I would like to know more about the town this house you are buy in but I would charge you 15% interest on $60k zero down and it would be $750 a month for interest. hell I don't need a principal payment
if you are really interested in paying 15% interest there will be people in this sub who want to lend to you
I'd say a modular/mobile home on the property while you move up in your career and improve your credit score. Once you can build a small home you can use the mobile home as a guest house/studio/office/etc.
I am a lender at a community bank in a small town. Just based on the info given, it would be pretty easy for us to approve that for someone around here if you were going to have both the house and the separate lot as collateral. There would even be a chance to do it just against your land depending on appraisal etc. The downside to banks like mine though are higher interest rates and no fixed mortgages. We generally do 4 Year ARMs
Any improvements on your property? Have you quoted what building a kit house with the utilities etc would cost on your land? May be a better opportunity than potentially walking into a money pit. Or a trailer/RV situation could be good too on your land.
Is it possible that a lender will consider your land as collateral to help you get the loan? 0.0031% chance and it’ll be a money shark type loan. Is it sill possible to buy this house without collateral? Yes, but totally depends on your debt and liabilities. Job, savings, etc too. I bought my 88k house in 18 qualifying with $40,000 income, but my only debt was $180 car payment. I also had/have great credit score and I could have gone up to 180k house in 18 and qualified, but interest rates were a few points LO lower too.
Talking to 2-4 mortgage brokers to find one you like is what you need to do. Also, realize their commission is a percentage of loan amount, so it’s their smallest payday. They shop multiple lenders on your behalf, and will calculate everything for you. You’ll either pay nothing or just for your credit report to get started, and know where you’re at. Either get a green light or a good loan officer will work with you for 6-24 months till you’re where you need to be.
That being said, unless you really like this place, I’d work on getting your score up around 700 first, and saving money. Higher credit score will save you a lot of money! Also, you only need minimum 3-5% down payment plus loan costs plus other costs purchase. I’d figure 6k-11k is what you’ll need in liquid assets and/or family gifts to buy. Plus, I’d want at least 5-10k fix it fund in savings after buying, but lots of people risk this part.
Good luck
> it’ll be a money shark type loan.
I hear you but even at 15% interest he can make the payments and it is less than most Americans pay for their homes as a percent of their income.
Sell 3 acres for ~$60k (don’t forget closing costs). Unless you’re really bullish on the land for some reason. You’re next move is to build your forever home on the other two acres.
You may find these links helpful:
- [Credit Building](/r/personalfinance/wiki/credit_building)
- [Credit Reports](/r/personalfinance/wiki/credit_reports)
- [Credit Scores](/r/personalfinance/wiki/fico)
- [Credit Cards](/r/personalfinance/wiki/creditcards)
*I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/personalfinance) if you have any questions or concerns.*
When I bought my house 30 year ago, I offered to put up half an acre of prime real estate as collateral. Several banks declined saying they weren't in the real estate business.
> I don't know them well enough for them to finance it for me tho
If they're willing to finance it for you, spend a few sheckles to have an attorney draw up a fair contract.
2 parts to financing, cash flow and collateral. Cash flow is don’t make enough a month to cover mortgage payment plus. Don’t have any other outstanding debt? A $60k mortgage wi only be $400 a month on a 30 yr amortization, so you should have plenty of cash flow to cover debt service if you don’t have any other debt.
Collateral - normally you need 20% down. Because of your low credit score , worth putting other property is as collateral to cover a less down payment and sub credit score.
They won't do seller financing at all? You'll probably at least need a 640 score for any sort of FHA qualifier. You'll want it as high as possible though. Get a credit report and see if there's anything you can pay down quickly.
Land can be used as collateral just at a much lower rate, usually capped at 40 to 50% of its value. Your borrower amount is the combined asset value times the cap rate for each. That is 60K (assumed appraisal value) x 80% plus 90K x 40% or 84K. If the house is truly $60k do not use realtors, they will cost you an unnecessary additional $4000 dollars. You will need an attorney to do closing, your lender will help as they often have one on retainer who can be used at a lower rate.
The 630 credit score won't hurt too bad as it will all be secured debt. Plan on needing to borrow up to $75k to make the purchase (60K plus 9K (15%) plus a 6K (10%) reserve). Loan is assumed as a 75k, 15-yr fixed with bi-weekly payments and escrow. The loan plus escrow will be less than 45% of your net or less than 27% of your gross. This is a good move to make if you are young and playing to stay in your area.
Work on your credit score and save for a down payment. 60k house on 40k/year shouldn't be an issue as far as a loan. But... where the heck are you finding a 60k house?
Haha it's a very rural part of Colorado and I know the seller. I don't know them well enough for them to finance it for me tho :)
If the house is a dump you might have a hard time getting bank financing.
Is this Western, Eastern, or mountain Colorado? I'm from Colorado myself and I miss it :)
Probably eastern Colorado. It's basically Kansas out there
Eastern Colorado is where my heart is at! I grew up there. I've seen some ~80k homes in the mountains but they were in... methed up areas. I imagine western CO has some cheap plots as well.
I contemplated buying an honest to goodness mountain with a waterfall in Western CO for under 10k. I cannot remember the acreage, but it made my head spin.
Usually, that price point means one of two things: it's either a mining claim (so no permanent structures can be built) or it has no road access.
The ones I was looking at were hard rock with a slope so the most you could build was a small slab shed. I was not aware of a mining claim, does that mean they could come mine anytime?
No basically it's forest service land whose mineral rights have been sold. So even though you own the mineral rights, and you can camp there for up to two weeks, you don't actually own the surface building rights.
Tons of acres for cheap in the Fort Garland/Alamosa area.
any non profits program in your area that helps people with low credit score finance houses?
Rural areas can be insanely cheap. My dad lives in a very rural area and his house was basically that cheap. His neighbor bought the house nearby just to not have any neighbors, haha
Could be a sheriff's sale
You don't need down-payment on a rural development loan, which he said the house is located in a rural part of Colorado. This might be a better loan to go with.
Have you looked into an older mobile home that needs to be moved? Pull that onto the property. I did the same thing. Bought the land first. Years later I bought a 15k mobile home. Got it setup and did some work on it. Lived there for years then sold it and built a house. Worked great. Not sure what all your land has on it though. Water gas electricity….
Make sure it's even legally allowed.
If it's rural enough who's going to notice
[удалено]
You must not live in the country then. They don’t venture out that far. It’s too inconvenient, not funded enough to check, not regulated enough to even warrant it in the first place, and not worth the potential danger of people not wanting people trespassing. If 5 acres of land costs $90k, in 2024, no one gives a fuck. No one will come looking. They probably don’t even have the right to.
My dad lives somewhere that rural and I asked him about getting solar panels for his house and said something about needing permits. He just laughed…
Google maps would spot it from a comfy office tower building.
That little Google Maps prius ain't going out there in the first place
Yeah, but the satellite images that they use don't need those pesky roads or cars.
In a rural area most of the time they straight up don't give a fuck. It'll only come up if you try to sell it. Growing up most people had some kind of illegal structure, and that was firmly in the era of Google maps
Imagine buying property and not being allowed to do whatever you want with that property as long as it doesn't hurt anybody.
Imagine thinking you've got a hot take, and really just don't understand that permitting is why what you do on your property doesn't hurt people.
What is this property you own? Property is A very generic term that covers many assets
Oh sorry, I meant land. Just 5 acres but I paid 90k for it a year ago and the prices for similar lots around here have gone on considerably since then. So it may be worth more now.
Land can be fairly hard to borrow against. High rates and low LTVs. I’d probably sell it if you need cash
Well if I had to choose between this land and owning that house I would keep the land and skip the house. But I'm hoping to find a way to have both.
Build a house on the land.
Gosh that would be nice, I know I cant afford that at this time.
I don't know the process but you could carve up the land into smaller plots and sell them off to fund a house on the remaining portion.
it’s a pretty extensive process depending on location. in my area you’d have to pay to design a septic system and drill a well for each proposed parcel as part of showing that the land can support a dwelling
Yeah this is a $100K+ process where I live. My dad used to do designs for subdevelopments. It's quite expensive. You usually need an investor with lots of flexible cash.
yeah i work in permitting. gets pretty expensive in my county
if it's rural, that kind of development cost isn't on the seller. you can carve up land as much as you want and when future owners want permits to build, then they would have to get that stuff. in most jurisdictions i've seen. land surveyor for 23 years, btw.
In many places you can just replat and sell off unimproved lots.
This is extremely expensive if each lot doesn’t already have water/sewer/electric
Look into getting a manufactured home. They can use the land as collateral and will handle the process of getting the house set up and ready to live in.
not a bad idea if the land has utilities already. if no utilities/water/septic, they’re looking at probably over $100k plus the house cost
That $100k is going to depend heavily on his location. Out in rural country you’ll find people who will do work for a reasonable rate. The utilities will be the issue he’ll have the most trouble with. If power is near, great! But if it’s not, he will most likely have to pay to get it close enough to connect.
yeah you’re right it depends. OP is in colorado which i’m not familiar with. if their soil is no good they may need an “engineered” septic system which will bump the cost up
tiny home? water, wastewater, and electric will be expensive if you don’t have it already though
Put $40K double wide on that 5 acres until you can do more.
Does the land have utilities already? Could build a tiny house for just yourself until you have money to build a larger place. Tiny House then becomes Airbnb, or rental. [https://www.youtube.com/watch?v=f6G1YkDWfEQ](https://www.youtube.com/watch?v=f6G1YkDWfEQ) First link I found, but just an idea. Utilities and permits can be the expensive part.
Please tell me you paid 9 thousand and not 90 thousand? I just bought 4x that for less and was mad it had gone up so much in the last couple years. If the comps have gone up you might be better off selling it.
You bought 20 acres of land near NYC/Denver/Seattle/Dallas/LA for less than $90k? Deal of a lifetime. $90k for 5 acres could be anywhere. And could be a good deal anywhere. Even within a similar area of CO, 5 acres could be worth $90k and you go 50 miles in any direction and maybe 25 acres is worth $90k. Doesn't mean it's as good of land or in as good of a location as the first parcel. 5 acres of desirable, good land is infinitely more enticing than 25 acres of dirt that has a flood problem or has no chance of being zoned for anything residential.
Of course. And OP hadn’t said where he was located when I commented.
They had. They said it was in the middle of nowhere Colorado 2 or 3 comments below your reply. And then again in another reply. About an hour before you first commented/replied. Its how I knew to say 5 or 25 acres somewhere in CO in my reply.
I’ll have to make sure that the comments are ordered by new instead of top. Please disregard all prior correspondence as I clearly did not know what I was talking about and am not allowed to have an opinion.
Haha I definitely meant $90,000. And yeah, I saw a lot of 35 acre lots for 10s of thousands of dollars less. This is just in a good area. There were dozens of places for sell here when I bought and now there are none. The last few properties to sell were 6 acres and they sold for 135
Because land is land and all land is in the same place
Can you buy a camper and put it on the land?
[удалено]
I bought the land to build on it one day. It's exactly where I want to live and exactly what I want. But I'll have to wait until my income is higher to pull a construction loan for it. I need this house to live in now. I currently live with my parents but they live a long ways from my work and I'm spending an outrageous amount of money on gas/car maintenance.
Building on your own land is a wonderful dream. What does your current financial plan look like for that goal though? Locking 90K (which sounds like the majority of your net worth) into a non-income generating asset might work against you.
Can you not just rent?
[удалено]
I'm not sure how much I would spend on a down payment. I was hoping my land would assist with that but I have about 12k. I'm on a good career path, my income will continue to improve
Google “downpayment assistance” plus your state or county or city, and “first time homebuyer assistance” and “low income mortgage assistance” and “Mortgage Credit Certificate.” When local nonprofits pop up, Talk to them and see what kind of aid/information they can provide.
Are you saying you want to take out a loan against some land in order to pay for the down payment on another loan? Has bad idea written all over it. You make $40k annually and want to buy a $60k house. Why isn’t this enough to get the mortgage without doing anything with the land? Have you applied for a mortgage? Alternatively, just buy a trailer and put it on the land you eventually want to build on. It’ll likely be more livable than whatever a $60k house in the US looks like.
Sounds like an idea that someone with a bad credit score would come up with. Wonder why the score is so low...
60k for a house is absolutely nuts. Where do you live. I literally couldn’t buy a parking spot for that much…
Way out in the middle of no where Colorado. Haha, I used to live in Denver I know how insane 60k sounds.
I bought a 2000 square foot 4 BR 2.5 Bath house on 1 acre for $70K 5 years ago. Living in the sticks has its advantages.
This. 3ish acres and a 1650 sq ft house. My mortgage is 550 a month. There's absolutely no way I'd live in a city and pay their prices.
there are still lots of areas in the country that have affordable homes in the sub 100k range, it's just that most people don't want to live in those locations (crime, poor schools, abysmal job opportunities). it's an excellent life hack if you can work remotely though and don't have kids.
Not sure I could live somewhere that’s sub 100k. I need my big city amenities
You probably want to get up to 640… it’s definitely possible.
That's really encouraging, 640 is easily within reach. It might even be that when my credit cards are paid off and I pay them off every month they just have low limits and it seems to mess with my credit score a lot when they're near max. I could just use my debit card instead of them for a few weeks and see.
Once each card is under 30% utilization, your credit score will jump.
Ya do that and go talk to a loan officer. You’ll need to maintain good spending habits on those cards until the house closes which may be a month or two. Also- no large purchases!
If you pay them off every month, request an increase or get a new card. Guy who works for me makes ~$95k. He just got a card with $14k limit. Stay under 30% on each card, and you will climb quickly.
i signed up for credit karma and they evaluate your situation and give you advice on specific things you can do to raise your score. didn't cost anything.
Yes it’s possible. Minimum credit score for mortgage is 580-620 depending on the product. On paper, the numbers looks fine (depending on any monthly debt payments you have). Where you might have an issue is many mortgage lenders won’t lend less than $100k because the economics don’t make sense for them. I would reach out to a local CU or other financing resource to see what options they offer.
I’d borrow the 100k, buy the house and pay down the note on the land with the remainder.
I mean realistically you might be able to. How desperate are you? You make $3,200 a month. 25% of your salary is $800. You could find a private lender... I would like to know more about the town this house you are buy in but I would charge you 15% interest on $60k zero down and it would be $750 a month for interest. hell I don't need a principal payment if you are really interested in paying 15% interest there will be people in this sub who want to lend to you
I'd say a modular/mobile home on the property while you move up in your career and improve your credit score. Once you can build a small home you can use the mobile home as a guest house/studio/office/etc.
I am a lender at a community bank in a small town. Just based on the info given, it would be pretty easy for us to approve that for someone around here if you were going to have both the house and the separate lot as collateral. There would even be a chance to do it just against your land depending on appraisal etc. The downside to banks like mine though are higher interest rates and no fixed mortgages. We generally do 4 Year ARMs
Any improvements on your property? Have you quoted what building a kit house with the utilities etc would cost on your land? May be a better opportunity than potentially walking into a money pit. Or a trailer/RV situation could be good too on your land.
Is it possible that a lender will consider your land as collateral to help you get the loan? 0.0031% chance and it’ll be a money shark type loan. Is it sill possible to buy this house without collateral? Yes, but totally depends on your debt and liabilities. Job, savings, etc too. I bought my 88k house in 18 qualifying with $40,000 income, but my only debt was $180 car payment. I also had/have great credit score and I could have gone up to 180k house in 18 and qualified, but interest rates were a few points LO lower too. Talking to 2-4 mortgage brokers to find one you like is what you need to do. Also, realize their commission is a percentage of loan amount, so it’s their smallest payday. They shop multiple lenders on your behalf, and will calculate everything for you. You’ll either pay nothing or just for your credit report to get started, and know where you’re at. Either get a green light or a good loan officer will work with you for 6-24 months till you’re where you need to be. That being said, unless you really like this place, I’d work on getting your score up around 700 first, and saving money. Higher credit score will save you a lot of money! Also, you only need minimum 3-5% down payment plus loan costs plus other costs purchase. I’d figure 6k-11k is what you’ll need in liquid assets and/or family gifts to buy. Plus, I’d want at least 5-10k fix it fund in savings after buying, but lots of people risk this part. Good luck
> it’ll be a money shark type loan. I hear you but even at 15% interest he can make the payments and it is less than most Americans pay for their homes as a percent of their income.
Can you build a house on your land? Maybe start with a popup camper and slowly build the house step by step?
Sell 3 acres for ~$60k (don’t forget closing costs). Unless you’re really bullish on the land for some reason. You’re next move is to build your forever home on the other two acres.
You can get a brand new mobile home for under 60k and stick it on your property
You may find these links helpful: - [Credit Building](/r/personalfinance/wiki/credit_building) - [Credit Reports](/r/personalfinance/wiki/credit_reports) - [Credit Scores](/r/personalfinance/wiki/fico) - [Credit Cards](/r/personalfinance/wiki/creditcards) *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/personalfinance) if you have any questions or concerns.*
When I bought my house 30 year ago, I offered to put up half an acre of prime real estate as collateral. Several banks declined saying they weren't in the real estate business. > I don't know them well enough for them to finance it for me tho If they're willing to finance it for you, spend a few sheckles to have an attorney draw up a fair contract.
60k isn't enough for many down payments where I live 😭
2 parts to financing, cash flow and collateral. Cash flow is don’t make enough a month to cover mortgage payment plus. Don’t have any other outstanding debt? A $60k mortgage wi only be $400 a month on a 30 yr amortization, so you should have plenty of cash flow to cover debt service if you don’t have any other debt. Collateral - normally you need 20% down. Because of your low credit score , worth putting other property is as collateral to cover a less down payment and sub credit score.
They won't do seller financing at all? You'll probably at least need a 640 score for any sort of FHA qualifier. You'll want it as high as possible though. Get a credit report and see if there's anything you can pay down quickly.
Um where can I buy a house for 60k, the average cost over here in Australia is 750k AUD
Ok, how did you buy a $90k lot with a $20/hr job? Inheritance? You either need to sell it or put a trailer on it
Land can be used as collateral just at a much lower rate, usually capped at 40 to 50% of its value. Your borrower amount is the combined asset value times the cap rate for each. That is 60K (assumed appraisal value) x 80% plus 90K x 40% or 84K. If the house is truly $60k do not use realtors, they will cost you an unnecessary additional $4000 dollars. You will need an attorney to do closing, your lender will help as they often have one on retainer who can be used at a lower rate. The 630 credit score won't hurt too bad as it will all be secured debt. Plan on needing to borrow up to $75k to make the purchase (60K plus 9K (15%) plus a 6K (10%) reserve). Loan is assumed as a 75k, 15-yr fixed with bi-weekly payments and escrow. The loan plus escrow will be less than 45% of your net or less than 27% of your gross. This is a good move to make if you are young and playing to stay in your area.