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Incoming first year med student here. I am interested in buying a condo right next to my university. 

What factors should I be considering when deciding to rent vs buy? 

Just to provide some background, I've been looking at 1BR condos in the 170-210K range, and I have enough money saved up for a 20% down payment. I know the location very well (spent childhood + undergrad in the same city). I have 0 student debts  - I funded my undergrad almost entirely on my own and I'm relatively frugal. My parent is willing to act as a cosigner if necessary in order to secure a mortgage.

Obviously, I won't have much of an income during med school (couple of low-commitment part-time jobs during the year + summer research= ~10K/year), so I'll likely be paying off the mortgage with a government loan and LOC. I understand that this will result in a lot of interest, so to mitigate that, I thought of putting down 20% with my current savings + take advantage of current mortgage rates to get a decent 5 year fixed mortgage rate + get a 20-25 year mortgage (to minimize monthly payments for now since I'm mostly paying with a LOC). Afterwards, if I need to move for residency I can either 1) sell the condo without paying the mortgage in full (if appreciation makes up for the costs of re-selling, etc. at the time... ) or 2) rent out the condo until it makes more sense to sell it (I understand that it's not guaranteed whether or not I'll have tenants... ). And if I end up doing my residency here, I can just continue living in it (and see if I pay off the mortgage faster once I start making more money). Am I thinking of this too simply?

Is it fairly common for people to buy condos in med school? Will I be saving more time/energy if I decide to rent instead? Should I even bother seeing a mortgage specialist at this point? 

Any insight would be appreciated! 

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56 minutes ago, X Æ A-Xii said:

Incoming first year med student here. I am interested in buying a condo right next to my university. 

What factors should I be considering when deciding to rent vs buy? 

Just to provide some background, I've been looking at 1BR condos in the 170-210K range, and I have enough money saved up for a 20% down payment. I know the location very well (spent childhood + undergrad in the same city). I have 0 student debts  - I funded my undergrad almost entirely on my own and I'm relatively frugal. My parent is willing to act as a cosigner if necessary in order to secure a mortgage.

Obviously, I won't have much of an income during med school (couple of low-commitment part-time jobs during the year + summer research= ~10K/year), so I'll likely be paying off the mortgage with a government loan and LOC. I understand that this will result in a lot of interest, so to mitigate that, I thought of putting down 20% with my current savings + take advantage of current mortgage rates to get a decent 5 year fixed mortgage rate + get a 20-25 year mortgage (to minimize monthly payments for now since I'm mostly paying with a LOC). Afterwards, if I need to move for residency I can either 1) sell the condo without paying the mortgage in full (if appreciation makes up for the costs of re-selling, etc. at the time... ) or 2) rent out the condo until it makes more sense to sell it (I understand that it's not guaranteed whether or not I'll have tenants... ). And if I end up doing my residency here, I can just continue living in it (and see if I can refinance the mortgage once I start making more money). Am I thinking of this too simply?

Is it fairly common for people to buy condos in med school? Will I be saving more time/energy if I decide to rent instead? Should I even bother seeing a mortgage specialist at this point? 

Any insight would be appreciated! 

You need to speak to a mortgage broker first.

I don't think you'll be given a mortgage  if you have no or low income coming in. An LOC is a loan and I don't think you can pay off a debt by creating another debt. I own two properties (older, non-trad) and I was told buying another property would be almost impossible. Speak to the mortgage broker and see if this is even possible, especialy with CHMC rules tightening.

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It is not common to buy in medical school, most people either can't afford to, or they aware they might have to move for residency and the math doesn't really make sense to buy+sell within 4 years or deal with renting from out of town. That being said, it does happen.

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 what exactly are you looking to do with buying a condo? If it is for investment purposes then buying a condo to live in is not a very good financial decision. Look up online the rent vs buy argument and the 5% rule.

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1 hour ago, Lavarball said:

 what exactly are you looking to do with buying a condo? If it is for investment purposes then buying a condo to live in is not a very good financial decision. Look up online the rent vs buy argument and the 5% rule.

It depends on your situation and your area.I just found out this calculator, it's very interesting! https://www.nytimes.com/interactive/2014/upshot/buy-rent-calculator.html

In my area at least, buying is usually as affordable as renting (and sometimes more affordable, especially with the low interest rates right now), and can be litterally twice less expansive than living in a university residence. With the same amount of money taken out from my LOC, or even less (!), I would rather recover some of it later, even if the investment is overall not that good. 

Anyway, a girl shared her experience about getting a mortgage recently on this forum and I found in very interesting (see below). She already had debts, so it was probably even more difficult for her, but she also got the support of a partner working full-time, so I'm not sure if it's possible otherwise.

 

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