House buying tips, suggestions, things to look out for, etc

[Splitter77]

Re: House buying tips, suggestions, things to look out for, etc

Ummm if he moves to an area that has a lot of water under ground, he is going to have to have a sump pump. Can't live in most places in the midwest and northeast without a sump pump.

Basement would flood even with no rain, just from natural under ground water tables.

i would never buy a house that takes in any type of water.

[ScoobySnax]

Re: House buying tips, suggestions, things to look out for, etc

I've just started to looking into buying something and I checked a mortgage calculator at one site (can't remember which one) and with a 30-year mortgage and 10% down a $250k house was going to run you nearly $850k by the time you paid it off. Absolutely insane.

WOW! What kind of interest rate was it? 20%? lol

[ehh]

Re: House buying tips, suggestions, things to look out for, etc

^ Think it's the insane property taxes in CT.

[duffman]

Re: House buying tips, suggestions, things to look out for, etc

Best advice i can give is like others have said, try not to spread yourself too thin financially going into the house, cause stuff will go wrong in the first year. I just bought my house last april and here's what i've replaced so far with costs:

-New roof, which was a complete tearoff and replacement of half of the plywood sheathing due to it being rotted from moisture. $10,000. We knew the roof was bad when we bought but thought we would get at least a year out of it. Started leaking about 2 months after i bought the house.

-Re-finished the basement due to previous water damage that had gotten behind the walls due to improper gutter drainage. More time consuming labor than anything, plus about $600 dollars in sheetrock and tile. Couldn't have been picked up by the home inspector cause there was no evidence until we went to pull up the old carpeting and the walls started crumbling when we removed the trim along the floor.

-New water heater @ $500.00.

-New oil tank @ just under $1k. The old one is still in the basement which will have to be removed eventually.

-Ripped out the sheetrock in one bedroom due to there being almost zero insulation in the outer facing walls of that room. Put in new insulation and replaced the sheetrock. Again, mostly just time + labor

-Replaced 2 double hung windows @ $500

-Slow leak in the shower in the master bathroom, probably coming from the pipes in the wall that lead up to the shower head. I'll be ripping out the wall, replacing or sealing the leaky pipes and replacing the wall in the coming weeks. Cost is TBD, but shouldn't be all that bad.


Alot of these costs were less than they should be cause the work was done by me, a neighbor and my father. Plus we got a large amount of slightly damaged sheetrock really cheap from home depot.

My property taxes went up a couple months ago, so my monthly payment is actually $60 more a month now than it was originally.

Still, i gotta say that it was totally worth it. Owning your own house is awesome, even if it did cost me a ton of money and time. With mortgage rates where they are right now it really is a good time to get into a house before they start to go up.

If you buy a house that has any type of an escrow agreement where money is going to be held until the sellers finish a repair or something, make damn sure that the agreement is air-tight. I had one that was drawn up quickly at closing cause of a leak we found during our final walkthrough, the seller refused to pay, we took them to small claims and the judge basically told me the agreement wasn't worth anything. Luckily the seller agreed to settle out of court anyway cause i asked for an adjournment (i guess they didn't want to bother coming back to court a month later) and i got most of the escrow money back, but be careful with any type of an escrow agreement.

[bigeastbumrush]

Re: House buying tips, suggestions, things to look out for, etc

20% down
15 year mortgage

Only way to buy a home. I did not and I regret that mistake.

I would highly advise against this. This is what got so many people burned 2006-on.

If this is what your lender/seller has a hard stance on, consider another lender or look for a cheaper house, more advisably, a cheaper house.

Until these appraisals start coming back down to earth, no one (unless they're ballin'), should be putting 20% down on a house IMHO.

You should put however much would be acceptable to the lender and how much would be manageable under your monthly budget.

Too many people have been screwed royally by putting all/most of their savings into a down payment and then having the value of the house just plunge downwards.

You cannot get that money back.

Put a minimum of 10% down, if allowable. The PMI that you pay will be, IMO, more easy to manage than blown money up front.

Unless of course you sell at a huge profit vs. everything you put down and added to the house.

What I did when I bought was calculated backwards.

Come up with your monthly debt-to-income ratio (the percentage of all of your fixed expenses over your monthly income). The percentage should be below 30%. Believe me, your lender and everyone looking at your financials is doing the same thing.

When you calculate your debt, only include fixed expenses. Not things like movie night out.

Then you can see how much of a monthly mortgage you can reasonably afford (factor in how much interest you'll have to pay).

Go over these numbers with your lender and get pre-approval. You'll have all your homework done and know how much of a home/mortgage you can afford. Makes you look that much more qualified to a seller.

Also, clean up any mistakes on your credit report.

This is all just my opinion from my personal experience. I am not an expert and many will disagree with me.

[Trevytrev11]

Re: House buying tips, suggestions, things to look out for, etc

I would highly advise against this. This is what got so many people burned 2006-on.

If this is what your lender/seller has a hard stance on, consider another lender or look for a cheaper house, more advisably, a cheaper house.

Until these appraisals start coming back down to earth, no one (unless they're ballin'), should be putting 20% down on a house IMHO.

You should put however much would be acceptable to the lender and how much would be manageable under your monthly budget.

Too many people have been screwed royally by putting all/most of their savings into a down payment and then having the value of the house just plunge downwards.

You cannot get that money back.

Put a minimum of 10% down, if allowable. The PMI that you pay will be, IMO, more easy to manage than blown money up front.

Unless of course you sell at a huge profit vs. everything you put down and added to the house.

What I did when I bought was calculated backwards.

Come up with your monthly debt-to-income ratio (the percentage of all of your fixed expenses over your monthly income). The percentage should be below 30%. Believe me, your lender and everyone looking at your financials is doing the same thing.

When you calculate your debt, only include fixed expenses. Not things like movie night out.

Then you can see how much of a monthly mortgage you can reasonably afford (factor in how much interest you'll have to pay).

Go over these numbers with your lender and get pre-approval. You'll have all your homework done and know how much of a home/mortgage you can afford. Makes you look that much more qualified to a seller.

Also, clean up any mistakes on your credit report.

This is all just my opinion from my personal experience. I am not an expert and many will disagree with me.

Good advice. Depending on the price of the house, PMI could run a hundred to a few hundred extra a month, which could be an issue if the house itself is spreading him too thin, but if he has the ability to put 20% down and only puts 10% down, he'll have that other 10% as a reserve/cushion.

The other nice thing of having an 80% LTV is the fact that you can self-escrow your property taxes and Homeowners insurance.