Buying First Home... Interesting Situation

DudeManBro wrote: ↑ Hey everyone, long time lurker here but this is my first post. I will leave out all the unnecessary details. Here's the situation:
$35,000 in debt split between CC and LoC at RBC.
House is for sale, I want to buy it, it is $40,000.
Self employed small business owner, avg monthly income for past 2 years about $1500.

I have been paying around $400/month in interest on my debt + the $300 for minimum CC payment for the past few years, so $700/mo., while not making any headway on my debt, also while living with family. Never missed any payments though, I always find a way to make things work, but these interest payments have been decreasing my quality of life.

I want to consolidate my debts and get a mortgage, after which I should be paying LESS than I am now for my current debts, make progress on the total because the interest is much lower, AND also have my own home.

Mortgage broker told me I have no chance of getting a mortgage or loan because of my debt to income ratio, and that RBC probably wouldnt increase my limit. Suggested that I try to go to another bank, or multiple banks, to get a line(s) of credit worth $40,000. Buy the house. Return to him to get mortgage, and use that mortgage to pay off lines of credit for home, and all remaining CC/LoC debt at RBC.

My questions are:

Is this the best way to go about it, and/or is there any other way to do this?

Assuming I get the Lines of Credit to buy the house, is it possible to purchase the house, go back to the mortgage broker, get the mortgage and pay off the Lines of Credit withing a short period of time to avoid paying the interest on the lines of credit (which would be 6x higher than the mortgage interest)?

If any more details are necessary just let me know.
Thank you all for taking the time to read, I look forward to seeing what you guys think.

Edit: Forgot to mention, I also own a 40-acre piece of farmland. Is it possible to use this as collateral in any way?

ProductGuy wrote: ↑ Wait, what... you have been living with family and you have this much debt. When you buy a house your expenses will increase not decrease. Why not focus on paying off all your debt before buying a house. And where in Canada can you find a $40,000 house???

ky.antz wrote: ↑ finally someone asking this question - i thought it was a dumb question i was just missing something.. but where tf can you find a $40k house.

NorthBC wrote: ↑ Towns all over....less desirable cities such as Regina too.

oilerfan89 wrote: ↑ unless the house was a murder house complete with a fresh body still laying there or a rat infested dump condemned you aren't getting a 40k house in Regina lol

DudeManBro wrote: ↑ However, I decided to just work extra hard to finish paying off the debt first, as many have suggested. I just tried to apply for 2 different balance-transfer credit cards and both applications were declined. My only hope of defeating interest payments seemed to be balance-transfer cards, but how does it help if I can't get one?
Not sure what to do now....

Dynatos wrote: ↑ I strongly recommend speaking with a not for profit credit counselling service.

Do you have any spare change after paying your expenses and bare minimum interest on the cards? If so, that should probably be put towards paying down the debt with the highest interest rate.

I know it's easier said than done, but you'd be also well served by trying to find ways to increase your income. Assuming that's gross income, you're below the poverty line before even factoring in your debt obligations.

DudeManBro wrote: ↑ Yes I usually have money left over but my biggest concern every month is trying to make sure I save enough for next months interest payment. :\

DudeManBro wrote: ↑ There are honestly tons of houses for 20,000-40,000$ in small towns all over Saskatchewan. They are all in small, middle-of-nowhere towns, that you have to drive at least 20-40 minutes to the nearest town with a grocery store. I live in one of these towns.

The whole reason I had this idea in the first place is because a friend of mine just bought the other cheap house down the street. It was a 75,000$ house and he is paying $157 biweekly. $300/month is less than HALF the INTEREST I'm paying now ($700) on ONLY my debt. Thus came the idea of consolidating it into a low interest mortgage. My debt and the house = $75,000, and I already know what the payments are on that. ^^^
The fact that the numbers involved are so small compared to usual home prices (100k+) makes it more of a unique situation as it could be purchased a number of ways.

However, I decided to just work extra hard to finish paying off the debt first, as many have suggested. I just tried to apply for 2 different balance-transfer credit cards and both applications were declined. My only hope of defeating interest payments seemed to be balance-transfer cards, but how does it help if I can't get one?
Not sure what to do now....

FARMERBLANCHE wrote: ↑ 8 houses 40kish or less in Regina today
https://www.zoocasa.com/regina-sk-real- ... obinson-st
Seems like the nicest one
I'm sure it's a great area
Was curious