Hi, I read one of your answers to a lady who had a situation similar to mine just receiving $$ and not knowing what to do.
I am 43 yo, single mom, two children 16 yo and 12 yo. I have a good job that I really like and I make 34k (before taxes) per year. I receive child support $250.- every other week.
Currently I am paying $925.- for rent, I know it’s a lot but when I started with this (April 2007), I had support from my brother he said it was for 2 years but he cut it at the first year. I can probably still count with the tax refunds (maybe 3-4 thousand a year). I just paid off my car, I have a student loan (Master’s degree, that I haven’t finished yet, but I will eventually) for 40k, that I will start paying on June 09. My credit cards debt it’s about 9k (nine thousand) at high interest because I’ve being behind and they are at the maximum limit. I just received an early inheritance from my mother to help me buying a house so I don’t have to struggle paying rent. (I have being paying rent and car payment since I came to US in 2000). I live in Georgia in a town 60 miles from Savannah. I saw houses that cost 150k in a lot of 0.5 acre. But I really would like to buy a land that it’s listed for $39,900.- for 3.9 acres, and build a home there. I am about to finalized my divorce in December so I can’t buy anything yet. With this case scenario what is your opinion, should I buy a house or build? I haven’t applied for a mortgage loan yet but my bank loan office (for my car loans in the last 6 years) has told me that I may be able to put 40 to 45k as sown payment and get 45k as loan paying $550.- monthly for 15 years.
I rally wouldn’t like to pay more than 400 month so I can be able to start saving and thinking about helping my children going to school in the future. Thanks in advance for your answers. :)

The key is the cost of construction and where are you going to live while the construction goes on. You really need to create a budget for yourself to see what you can relaitcally afford. If the numbers work, you can go for the property.

With $50k down on a house costing $150k, at 6% interest, that's $599.55 / month (you'll also pay taxes & insurance).

Building a home can save you money in the long run, especially if you act as your own general contractor, but construction lands are usually more costly (higher interest rate) as its riskier for the bank making the loan. Also, you'll probably have to pay interest on the loan while building and pay your rent.

But if you have 50k set aside, and pay cash for the land, that's 10k left for interest payments while its being bulit.

Building a home is very risky, and leaves many people open to fraud and contractors who will take your $$ and run. Its also leaves a lot of room for error in judging the cost of a house.

If you DO build a house, consider a prefab house. They are built in sections at the factory and finished on site. It takes a lot of the risk out of things when you can trust that a house will stand up and at least have a roof over your head. Lol. Good luck.