NT's Homeowners, I need help.(25+ come on in)
- Thread in 'General' Thread starter Started by SneakerProSr.,
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I just bought a house last February on a FHA loan, and you only need to put 3% down. Is it good to put more down? Sure, but you don't have to. Another thing that's important is, don't buy what you can afford, especially if you think you might wanna upgrade in the future. Buy what's easy for you to afford, unless you are buying your dream home as your first house. Don't be house poor or buy a house with a lot of space just because, because you are paying for space you aren't using. Just be smart dude, get what fits your needs and likes. And like the one homie said, when you do finally get a house, double up on those principal payments every month if possible, it will help you pay the house off a lot faster.
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The 5/1 arms are the absolute best deal on the market if you don't believe you will be in your house for more than 7 maybe even 8 years. The FHA arms have an adjustment cap of 1% per year after the 60th month (5th year) and depending can adjust up or down. So even if you had a 3% rate adjust up to the worst case scenario of 4%, it will almost for sure be lower than where rates are at in year 6. Also by year 7, if your arm adjusts to 5% (again assuming worst case scenario) that will probably still be less than what rates are at, not to mention you've already spent 5-6 years building equity in your place while only paying the bank 3%-4% in interest. For younger borrowers these type of loans make a ton of sense. In OPs case you are still young, a batchelor, and without a wife/family. If you put an arm on your house by the time you settle down and start a family, you might need to think about moving to a bigger house or a place with a better school district, etc.
Only negative through the FHA is that you must pay the monthly mortgage insurance (similar to PMI). However, some banks offer LPMI loans- lender paid mortgage insurance. These loans are typically 1/8 to 1/4 of a point higher than what most brokers and banks will charge you. They lender buys out the mortgage insurance by giving you a higher interest rate and in addition to your principal and interest you will only owe your other escrow items- property taxes and homeowners insurance.
If you have any other questions fire away. I deal with mortgage on a daily basis...
Only negative through the FHA is that you must pay the monthly mortgage insurance (similar to PMI). However, some banks offer LPMI loans- lender paid mortgage insurance. These loans are typically 1/8 to 1/4 of a point higher than what most brokers and banks will charge you. They lender buys out the mortgage insurance by giving you a higher interest rate and in addition to your principal and interest you will only owe your other escrow items- property taxes and homeowners insurance.
If you have any other questions fire away. I deal with mortgage on a daily basis...
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I own a townhouse on a FHA loan. I was initially told they could/would streamline my rate on my loan without having to close again. I was lied to. I must re-finance to get a lower rate and payment.
Don't go off what the calculators say you can afford. Look for what you are willing to pay. Life changes fast meaning money leaves faster. You have your utilities such as gas, light, water in addition to comforts like cable/internet and cars.
Get as much house as you can because you start to accumulate more things that will fill the house before you know it.
Good luck house hunting! Perfect time to be a buyer.
Don't go off what the calculators say you can afford. Look for what you are willing to pay. Life changes fast meaning money leaves faster. You have your utilities such as gas, light, water in addition to comforts like cable/internet and cars.
Get as much house as you can because you start to accumulate more things that will fill the house before you know it.
Good luck house hunting! Perfect time to be a buyer.
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Stupidest thing I did after graduating college (2005) was buy a car. Best thing I've done last few years? Pay off my damn carOriginally Posted by CJDynasty
4wrestling, I definitely remember you place, and 2K a month on a 250K condo is!
Man call me silly, but I am envious at you guys being able to save that 20%!! How long did it take for you all to do that? Maybe for me, since I just graduated (last May), and just started working (Aug.) thats why it seems like an unbelievable task. And I make good money!
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damn 150k for a house??? i cant even find a condo for that price in the bay area
for reals.
well OP, like a lot of us are saying, put some money down. first off, try to look for a house that has been foreclosed you'll more than likely to get a better deal. i dont know the percentages of foreclosed homes out there in texas but im sure theres some. find a bank that you know and feel comfortable with. also get yourself a trustworthy realtor and of course get a close family member or a close friend who are established homeowners to shoot you some good input. good luck OP! keep us posted. congrats on making the decision to buy a house.
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LazyJ- Banks are just starting to bring this program back. When I sell customers on it, I let them know that their rate is higher than current market because they don't have to pay PMI. So, I would assume most loan officers/banks would let the customer know the details of their loan program.
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It's hindering a sale because the "mortgage insurance" company rejected it. I dont pay PMI and the mortgage was originated in 2007. Further, it was a part of the BofA "No Fees Mortgage". So my monthly is literally one line item of principal and interest. Nothing else.In the docs it's boiler plate and states if there's PMI the Lendee (me) would be paying premium.
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Another hidden cost that i didn't see posted was mello roos tax. That tax alone wiped out about half of the houses we were looking at. I know not all communities have mello roos but that is good knowledge to have while looking at a particular area.
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I got the 20% down payment saved up... Just need to make sure the wife and my credit is up to par.
BTW,This thread is
Loads of great information that first time home buyers can benefit from.
BTW,This thread is
Loads of great information that first time home buyers can benefit from.
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I live in Dallas as well, actually I lived in Frisco and now I live out in Las Colinas...Here is the best advice I can give you b/c I am the same age as you. DO NOT BUY A HOUSE UNLESS YOU PLAN TO LIVE HERE FOR A LONG TIME.
You mentioned that you live in one of the fastest growing cities in America. What you failed to realize is that there is more land out here than one can imagine. They build out not up in DFW. You will gain NO EQUITY in buying a house and the appreciation on houses in our area are some of the WORST IN THE COUNTRY for a city our size. I would hold onto your money for another 5-10 years before looking to buy a house. I am an investment banker and used to restructure mortgages so believe me when I say I know what I am talking about.
In the end the decision is yours, but I would strongly advise you not to purchase a home anytime in the near future atleast not in the DFW area if you are looking for your money to go into the positives. Much better investment routes you could take with that the money you would spend on a mortgage and up keep than to sink it into a house in our areas market.
PS - Please don't look at HMS - I know you seen the commercials
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you are that dude, fams..
i'm tryna get like you... 6 years away...
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This is not a knock but if you only have $6k saved, you shouldn't be thinking about buying a house, even if you believe you can save another $10k by the end of the year.Originally Posted by SneakerPro
Man plenty of good info so far, I really appreciate it everybody.
I have about 6K saved up but honestly I waste $1000-1500 a month on random $#**, I was a broke @!% college so having a decent income is still kinda new to me But between now and December 1 I can easily save 10 grand more.
From what I've gathered from talking to my parents and this thread I'll look for something built in the last 5 years that costs between 90-125K. I suck at fixing stuff so I have to buy a newer house. Neighborhood and affordability are what matter most to me. Right now for housing I pay about 955.00 TOTAL. That is the rent, lights, cable, everything. I'm not buying a house where my costs will be dramatically more than that. 200-300 bucks more would be okay because I still have ways of eliminating that much from my monthly expenses but I'm not going that much higher.
I wish the 65K was after taxes
A lot of good points made throughout this thread. Even if you're looking at something that's $125k, the best realistic situation you could be in would be to put $25k down. Keep in mind the bank is going to require that you have a certain amount in reserve. Althought $125k with even 10% down is a low monthly mortgage payment based on a 5% 30 year fixed mortgage, approximately $600/month, keep in mind you'll be paying property taxes, utilities (larger square footage, greater utility costs), PMI, maintenance, etc etc. If an appliance breaks, you're responsible for having it fixed or replaced, same with your furnace, hot water heater, washer/dryer, all of that. You'll either need a lawnmower or a landscaper, unless that's paid for in homeowners' association fees. If the driveway, siding, roof, windows, whatever need to be done, that's on you. Also as mentioned, FURNISHING the place.
You definitely make a solid income to be able to afford being a homeowner in that area based on what you're saying. Make sure your credit is as good as it can possibly be. You're allowed 1 free credit check per year through each of the major credit bureaus (Experian, Equifax, Transunion) so I advise you do that ASAP and eliminate anything you might not have been aware of or pay off any existing debt that you can. Then just continue to save.
Depending upon where you live, I know in my area the market has actually leveled off but some of that will be tied to mortgage rates staying low, the prediction is that we'll see them increase slightly. I would seriously suggest that you save more, keep an eye on the market and then decide. Pay attention to not what houses are listed for but what they're selling for and you should be in a good position to make a purchase in the near future.
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Man I got so much info to offer but I'll keep it short and sweet for the sake of this post...
- Don't be afraid to have a realtor look for foreclosures for you
- There's alot more costs to homeownership than just paying your mortgage, utilities, and taxes...always, always, ALWAYS have some cash on hand for any problems that might arise
- Don't go housebroke (meaning don't try to buy up a whole lotta !%$* to fill up your house as soon as you purchase the home...take your time)
- If you plan to stay in your house for a long term and aren't looking at a purchase as a short term investment, don't worry about putting alot down (equity is only initially valuable to you if you plan on selling quickly or taking out a home equity loan...also PMI ain't gonna cost you much on a $150K house)
- BECOME A HANDY MAN, PAINTER, ELECTRICIAN, LANDSCAPER, PLUMBER, ETC. Dog I can't BEGIN to tell you how much money I've saved by learning how to do stuff around the house myself. Trust, with the internet and just by reading instructions, you can learn to do almost anything well.
I got alot more but just hit me with a PM if you need more advice. I bought my house in the Houston area in 08' for $159K. It was a foreclosure, is 2600sqft, one story, 4 bedroom, 2 bath. I love it and have no regrets. Well I do have one regret. Moving into a neighborhood where my damn HOA dues is $580/year.
We got alotta nice amenities and the landscaping is on point but damn, $580!?
- Preciate it.
- Don't be afraid to have a realtor look for foreclosures for you
- There's alot more costs to homeownership than just paying your mortgage, utilities, and taxes...always, always, ALWAYS have some cash on hand for any problems that might arise
- Don't go housebroke (meaning don't try to buy up a whole lotta !%$* to fill up your house as soon as you purchase the home...take your time)
- If you plan to stay in your house for a long term and aren't looking at a purchase as a short term investment, don't worry about putting alot down (equity is only initially valuable to you if you plan on selling quickly or taking out a home equity loan...also PMI ain't gonna cost you much on a $150K house)
- BECOME A HANDY MAN, PAINTER, ELECTRICIAN, LANDSCAPER, PLUMBER, ETC. Dog I can't BEGIN to tell you how much money I've saved by learning how to do stuff around the house myself. Trust, with the internet and just by reading instructions, you can learn to do almost anything well.
I got alot more but just hit me with a PM if you need more advice. I bought my house in the Houston area in 08' for $159K. It was a foreclosure, is 2600sqft, one story, 4 bedroom, 2 bath. I love it and have no regrets. Well I do have one regret. Moving into a neighborhood where my damn HOA dues is $580/year.
- Preciate it.
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^
...Damn bruh, you live in the Hamptons???
- Preciate it.
- Preciate it.
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one more thing to consider...
how much cash will you have left after down payment / closing?
a general rule of thumb is that your emergency fund should last you anywhere from 3-6 months. and this money needs to be liquid (savings account, money market, etc).
how much cash will you have left after down payment / closing?
a general rule of thumb is that your emergency fund should last you anywhere from 3-6 months. and this money needs to be liquid (savings account, money market, etc).
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i cant even get a ninjahood's size room shack in cali for that price
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I'm learning so much in here..22 btw
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Just to add some perspective, that's like buying a pad in Corona, Colton, etc.Originally Posted by Mr Jordan04
i cant even get a ninjahood's size room shack in cali LA for that price
I'm saving up, still, hope to jump in the market by the end of the year. I have no shame in asking my realtor to look up foreclosure listings.
Still finding a decent house for under $200k is a $!!++%$ pipe dream. I want to stay as close to the city as possible. I would rather pay a little more than live my life on a freeway, commuting everyday
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Always make sure you check if the prorperty youre trying to get has an HOA(Home Owners Associates) fee... That !#*$ can be a straight deal breaker. Alot of places I'm looking at right now have HOAs of $300+ a month... I'm good.
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Originally Posted by bc60997
I live in Dallas as well, actually I lived in Frisco and now I live out in Las Colinas...Here is the best advice I can give you b/c I am the same age as you. DO NOT BUY A HOUSE UNLESS YOU PLAN TO LIVE HERE FOR A LONG TIME.
You mentioned that you live in one of the fastest growing cities in America. What you failed to realize is that there is more land out here than one can imagine. They build out not up in DFW. You will gain NO EQUITY in buying a house and the appreciation on houses in our area are some of the WORST IN THE COUNTRY for a city our size. I would hold onto your money for another 5-10 years before looking to buy a house. I am an investment banker and used to restructure mortgages so believe me when I say I know what I am talking about.
In the end the decision is yours, but I would strongly advise you not to purchase a home anytime in the near future atleast not in the DFW area if you are looking for your money to go into the positives. Much better investment routes you could take with that the money you would spend on a mortgage and up keep than to sink it into a house in our areas market.
PS - Please don't look at HMS - I know you seen the commercials.
I'm not buying a home to invest. It just doesn't make sense to me to keep paying rent. For the exact same cost I pay right now I can own a decent home. Realistically the only place I would even think about leaving the DFW for is Miami or Southern Cal but those are more pipe dreams
Even if I don't buy a house I wouldn't leave the DFW anytime soon. The things I don't like about the DFW are prevalent in all major cities except the weather(its too dawn cold here for me)
HOA fees are a dealbreaker for me as well. Bastards can come take your house even if you own it and paid it off.
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