Mortgage Question

[tigerscowboy]

I should have added a note: The normal person should never consider their primary home an investment.



No, I am not in real estate. I was in commercial lending at one point (we lent to homebuilders and developers).

Simply from an economic standpoint, at this time, money is too cheap to not get a mortgage with as little down as possible. Historically inflation is at or higher than the current rates.

We will disagree on this due to different financial and economic views, neither is wrong nor right.

Well said and I agree. Without knowing the situation of the consumer or the actual product, who can state a wiser position?

[tigerscowboy]

I'd like to expand on this a bit with an example.

In my neighborhood my exact home rents for $1800/month. When I had PMI (FHA Loan) my total payment including PITI was ~$1600. When I refi'd my payment went to ~$1450 (PITI separately) with an 80/20 loan with no more PMI. Granted, my taxes go up every year.

I'm following you on this and I do the same math regularly with property here in First Colony and our surrounding area. You are likely familiar with this area as well.

The missing value in your scenario is the upkeep/maintenance of owning vs renting/leasing.

Not trying to get a last word here. Just sharing a reality I deal with at work.

[tmurray]

When I bought mine I was young 22, couldn't afford enough down payment to get rid of pmi. But I did a 30 year mortgage and got the house at a great deal by buying it from a relative. Also this was during the time Obama was giving the big rebate checks to first time buyers. I think it was 7 or 8k? I put it right back into the house. My bote was about the dame as my rent anyway 4 years later after pinching pennies and doing extra payment I was able to refinance at 3.2? Maybe 3.3 will have to double check on a 15 year note and lose the pmi. My houde value has also increased 70k from purchase cost about 8 years ago.My monthly payment didn't change much...can be great for the right deal in my opinion.

Worked out great for me

X2, literally the exact same story. Refi'd on 15 year note last year at 2.875% and payment went down $20 a month.

[Tower43]

X2, literally the exact same story. Refi'd on 15 year note last year at 2.875% and payment went down $20 a month.

I did the same swapped a 30 yr for a 15 yr three months ago and payment went up $60. I was paying off $200 a month after six years and now in the first month am paying off $600 every month on principal

[Tx_Wader]

A home you live in should not be viewed as an investment, period.

I disagree.

Your home is a huge investment.

[RamDrvr]

Not to sidetrack but why can't I get approved for a 40,000 house but can get a 50,000 5th wheel?I don't understand how that works.

[captainsling]

If a buyer lacks the ability to get a mortgage without PMI, they are almost alway spending/wasting more money than renting.

It's always easier if purchases are viewed as investments vs a need that is impacted by emotion. The problem we see most people have is that they don't like the answer.

I totally disagree with this. We bought our last house in 2007 and paid $54 a month in PMI for the first 5 yrs and we were done. Sold that house in August and made $80k. Now we have enough to put 20% down on our new house we are building, and not have to pay PMI.

If you are a first time borrower there is nothing wrong with PMI in my opinion.

[manwitaplan]

Not to sidetrack but why can't I get approved for a 40,000 house but can get a 50,000 5th wheel?I don't understand how that works.

Because most lenders do not want to loan out money below 100,000. Contact STan on here and he will explain the options.

[Uncle Saggy]

I recently made my LAST mortgage payment

Woo Hoo

[BrandonF]

There are some first time home buyer programs with 3% down. And some grants for first time home buyers also.

[Tower43]

Not to sidetrack but why can't I get approved for a 40,000 house but can get a 50,000 5th wheel?I don't understand how that works.

It's usually two very different types of credit and creditors. The fifth wheel will usually be much higher percent interest. It's easier to repo the fifth wheel when you don't pay much harder to get you out of a house. There's much more to the differences but that's a start

[Tower43]

I totally disagree with this. We bought our last house in 2007 and paid $54 a month in PMI for the first 5 yrs and we were done. Sold that house in August and made $80k. Now we have enough to put 20% down on our new house we are building, and not have to pay PMI.

If you are a first time borrower there is nothing wrong with PMI in my opinion.

You can do it and lots of people do (I did on my first, VA loan with no PMI) but you are gambling a little. It might pay off and it might not

[marshman]

Well this is for a place at the lake so I am not a first time
Buyer and it won't be our primary residence. Just a weekend/vacation getaway. The asking price is 63k although they are motivated to sell and I could probably get it cheaper. I just don't want to put up a 5% down payment on it.

[marshman]

I did the FHA route on my last loan. Won't do it on my next one.

may I ask why?

[Tex_Cattleman]

For what it's worth, I locked a customer loan this past Thursday at 3.5% with .25 lender credit...30 year note. Cheap $$$$!!!!!