House Woes

Yeah our Realtor is actually a family friend...so she is basically doing this for us....we have a pre qualification and everything, just waiting on our motgage lender (who is also a friend of mine) waiting to see what loans we can get for that particular house.
 
Cherokeekid88 said:
The price of the house is not a problem... we can afford the mortgage just fine...its just the down payment. Hopefully the house is USDA approved. I understand that the house might not be a house we live in for a very long time, but I refuse to buy a house to save a bit more money and out grow the house in 2-3 years. The house has ALOT of potential to be very nice. don't get me wrong...there are things that can be done to the house, just nothing immediate.
This house just seems to be the one I can really see myself living in....but if its not meant to happen, then its not.
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No offense, but if you can't afford the down payment then you can't afford the house. This is how so many people got into problems with mortgages and got underwater and then wound up foreclosed on and how the housing crisis started.
 
DSM Turbos said:
No offense, but if you can't afford the down payment then you can't afford the house. This is how so many people got into problems with mortgages and got underwater and then wound up foreclosed on and how the housing crisis started.
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Well, then that means I can't afford to put down 5,000 without being broke...Our mortgage would be about $75 more dollars then our rent right now....neither one of us have any debt now. Paid everything off, which is why we don't have much savings. We could techincally put down a downpayment with our savings, but like said before, that would be everything we have, and don't want that to happen at any cost. We also don't want to have to sign another year lease or lease from month to month on our current place.
 
Cherokeekid88 said:
Well, then that means I can't afford to put down 5,000 without being broke...Our mortgage would be about $75 more dollars then our rent right now....neither one of us have any debt now. Paid everything off, which is why we don't have much savings. We could techincally put down a downpayment with our savings, but like said before, that would be everything we have, and don't want that to happen at any cost. We also don't want to have to sign another year lease or lease from month to month on our current place.
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So you are having trouble with a down payment of 5k?

What about paying for the closing costs? Insurance on a house is also a lot more than rental insurance, then you have taxes also.

What are you going to do if the AC breaks, the house needs painting, the heat breaks, needs a new roof, have to get a new car, etc? Home ownership is not cheap, and not easy. There is always something that needs to be fixed or needs money in it. If it was me I would save for a good down payment and still have a cushion in my accounts for if something goes wrong. But that is an individual choice, but if you look at the housing market and who had to do a short sale and a foreclosure, it was the type of people that couldn't put a good downpayment down for the most part and over extended.
 
DSM Turbos said:
So you are having trouble with a down payment of 5k?

What about paying for the closing costs? Insurance on a house is also a lot more than rental insurance, then you have taxes also.

What are you going to do if the AC breaks, the house needs painting, the heat breaks, needs a new roof, have to get a new car, etc? Home ownership is not cheap, and not easy. There is always something that needs to be fixed or needs money in it. If it was me I would save for a good down payment and still have a cushion in my accounts for if something goes wrong. But that is an individual choice, but if you look at the housing market and who had to do a short sale and a foreclosure, it was the type of people that couldn't put a good downpayment down for the most part and over extended.
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Don't mean to be an ass but this is on the money - if you are struggling to come up w/ a 5k down payment - now is not the time for you to be buying a house.

even once you are in, it's a safe plan to assume needing at least 3k, probably-5k or more "emergency money" available at all times.
Yes there is homeowners insurance but unless you pay a lot for it, the deductable will be $1k and any claim will take forever to get filed.
If the A/C unit shits the bed in the middle of the summer, you could be looking at 1-2k right out the window. Or who knows the basement could flood or a tree falls on the roof or the septic gets backed up...

$75 more than renting - but now YOU are solely responsible for anything that happens.

Take some time and just save $$. Trust us on this one. Houses come and go. This one may seem perfect, bu ta year from now there could be an even more perfect one (w/ a 2 car garage).
Plus w/ FHA loans, you are going to PAY THROUGH THE NOSE for MIP, and it takes a loooong time to get out from under that. Lots of money just being pissed away. The more you can put down now, the less you'll be losing in the long run.

My advice is.. .figure out what you can afford.. then buy 80% of that.

But all that said - there IS the option of asking the seller to pay closing costs, even if it means a slightly higher purchase price - then you can keep you $$ for the DP or emergency $$
 
Will they still let you do a 5/15/80 split to get out of paying PMI? You put down 5% cash, get a mortgage for 80% LTV, and then a second mortgage for the 15% remaining. The second is at a higher rate, but you're still paying against the principal, rather than pissing away $100/mo to some mortgage underwriter.

The other thing to keep in mind is that mortgage rates are stupid low right now... about 3.6% for a 30 year (30 yrs are ripoffs, btw) and around 2.75-3.25% for 15s and 20s. If you can 'almost' afford it with the rates this low, then that's a house that you *wouldn't* be able to afford if mortgage rates were more like 5-8% that they were several years ago (and for 10-20 yrs before that).
 
shawn said:
The other thing to keep in mind is that mortgage rates are stupid low right now... about 3.6% for a 30 year (30 yrs are ripoffs, btw) and around 2.75-3.25% for 15s and 20s. If you can 'almost' afford it with the rates this low, then that's a house that you *wouldn't* be able to afford if mortgage rates were more like 5-8% that they were several years ago (and for 10-20 yrs before that).
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We locked in a 30 for 3.375 on Monday morning.
 
Our rate that we can lock in right now is 3.25%. I understand what you guys are saying...the part I didn't tell you is that My father in law is going to give us the down payment money...He is just having a bit of trouble getting it to it. So all the money would have saved, would still be there when we moved in...just waiting to hear if he is going to be able to get it.
Really don't want to keep renting....feel like I throwing money away every month. Interste rates are so good right, I would feel moronic not to buy at a time like this....
 
DSM Turbos said:
We locked in a 30 for 3.375 on Monday morning.
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thats what ours is now (FHA refi).
The 80/15/5 thing is pretty much gone now. FHA will allow 97% financing so the DP is lowest that route. You definitely lose the most $ in the long run though. If it qualifies for the Ag rural housing thing that's the best deal.

Also keep in mind if you just barely squeak in today w/ minimal DP, you have like zero equity in the house.
What happens if you have a big job change in 2 years, or even 6 months, and have to move?
 
Get a 15 or 20 year if you can.

The first 10 years of a 30yr, the vast majority of your money goes to interest. Look up amortization tables for 15, 20, and 30 year fixed mortgages.
 
As for the 401k, you say you hear people say pull from it and you hear others say don't pull from it. Do this, look at these people and their financial status/standings. Typically the ones who are telling you to leave it alone are in much better financial standing than those who say pull from it. There's a reason.

Leave it alone.
 
Being in the military they always preach have at least 3 months worth of bills, grocery money etc... Trust me when being a homeowner this is very sound advice! I took off for deployment in October and I've had to fork over a few times so my wife could have stuff fixed. As said before stuff breaks and you're now in charge of repairing/ replacing it. Not trying to tell you what or what not to do just a little advice, always have some money set aside in case of emergency!
 
mbalbritton said:
As for the 401k, you say you hear people say pull from it and you hear others say don't pull from it. Do this, look at these people and their financial status/standings. Typically the ones who are telling you to leave it alone are in much better financial standing than those who say pull from it. There's a reason.

Leave it alone.
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This.

Also, I will tell you some stuff from personal experience. When we bought our house 8 years ago we bought it with the belief that we would stay in it forever and would be making more money eventually, etc. BAD IDEA. While I am making significantly more money, my wife too a better job that paid less. We are still making more than before, but also have two kids that we have to pay daycare/after school care for. That on top of Obama taking an extra $200 out of our take home pay, I would bet that we make less than we did 8 years ago. A lot less.

Really caught up to us here now that our AC unit needs replacing. Made us realize things are not good financially, we are going to downsize here shortly probably, save some monthly payments and allow more for emergencies.
 
Well, we are getting some help from my father in law...so our money will stay where it is and be used to buy a couple things that the house we end up with needs and the rest will stay in savings...I guess we are just so ready to get out of apartment life, we just think of how we can do it the quickest, but I refuse to buy a house being broke....
 
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