First time home buyer questions

[91cavgt]

I got a realtor that was in the business of making a living.

I think that's fairly common

Ours was in the business of making money too, and she REALLY brings in the money too. I checked her reviews online and right now, she is averaging 3 houses a month. That equals around $15k a month. If that is not making money then I don't know what is.

[wal1809]

The advice on the financing can go either way. I bought my home on a 30. We could not afford a 15 at the time. Over the 13 years we have had the place, interest rates hit the floor. We refi-ed twice. I am at 2.75 interest rate on a 15 year now as of 5 years ago. The property has doubled in value, getting near to tripled in value. In 2 years I will sell it, take the cash an build a paid for barndo in central Texas, paid for with cash.

My point is there is a whole lot more than one dimension when it comes to finances. There are lots of twists and turns that can come your way if you find them. My best advice is to find out how to use somone elses money and have another pay that money back. I am at 5 rent houses now and when I hit 10, I am gone!

10 years ago I met a friend I had not seen since I was 20. We worked at the same place. I asked him what kind of work he had been doing. He said "Oh a little of this and that". Finally he said he didnt work unless the job paid crazy money. He was retired at 40. His wife worked a little and he worked a little but for the most part, nothing, nada, no work. He asked if I remembered the little house he and his wife struggled to buy. HE further went on to say it had long since been paid and 10 more just like it. All rented out, all were paid off. He is making near $10,000 gross, monthly. With an average net of $8,000 per month.

I can live off that.

[redneck82]

If you can not afford a 15 year note it is too much house. Paying off our second house this year.........

I think that this is sound advise, but not applicable for everyone. If I lived with the advise I would never be able to buy a house.

I have 3 kids on a single income and live in a house that I can afford. I also don't have any other debt than my house and 1 car.

Buy the house you can afford with the means that you can.

[hardtner]

Contact a reputable real estate broker. They can answer all of your questions and it won't cost you a dime.

[hardtner]

In Texas both realtors work for the seller. Ask questions here......

Seriously? If this is what you believe, you are in no position to give advice on a real estate thread. Maybe 25 years ago, but not now

[SCREAMINREELS]

Be mindful on what EXACTLY you can afford. I am in my third house, and every time I've been "pre-approved", the amount has been so astronomical. For example, my first home, they said I was pre-approved for a 250,000 house. But...that was calculating principle alone. They did not factor in taxes, interest, HOA, insurance, etc. All those things definitely add up. If I was just paying principal, it would been around $700 a month, which would've been about $200 away from what we could do at the time (in 2005). Instead, we bought a house for $105,000, which put our payments at around $950/month with the other items added in. I really think that's why the housing market plummeted, because people were being told they could buy more of a house than they could, then got screwed over once they were in.

What I've learned is that .8% of the purchase price on a 30 year mortgage is around what your monthly payment would be if you didn't put anything down on a first time buyer program. That's been pretty much across the board for me. I use 1% as a rule of thumb just to be safe.

Agree on this especially if you plan on having kids (they're awesome but not cheap)
I was pre approved for around 100k more then my house cost by myself, I bought it before I got married. After having kids(and an additional income from the wife) I really don't think I would have been able to afford that extra 100k. My income had gone up but so have my expenses

I started with a 30 year note and wish I didn't....But I did refinance for a better rate and a 15 yr note a few years later

[Charles]

Buy in a desirable school district.

Put down a minimum 20% to avoid PMI. Like mentioned above, PMI is throwing money away.

Inspection...inspection inspection.

Be prepared for unforeseen expenses after purchase. Furniture, blinds, curtains, repairs and general maintenance & up keep.

Welcome to the American dream of home ownership (even though you never really own your home due to property taxes)

[bhaggie86]

I live in Crosby but zoned in the Huffman school district. I preferred that district and community a little more than Crosby.

[wal1809]

Buy in a desirable school district.

Put down a minimum 20% to avoid PMI. Like mentioned above, PMI is throwing money away.

Inspection...inspection inspection.

Be prepared for unforeseen expenses after purchase. Furniture, blinds, curtains, repairs and general maintenance & up keep.

Welcome to the American dream of home ownership (even though you never really own your home due to property taxes)

Best post of this thread. When you pay you house off, you get to look forward to renting from the county for the rest of your life.

[RWB]

I am not original in that I do what Dave Ramsey advises and like it or not it has worked out very well for us. Keep it simple....15 year not where the payment is no more than 25% of your take home pay(principle, interest, taxes and insurance) . If you do this you will be in great shape. Don't over complicate it keep it simple, don't do a 30 and keep your payment in bounds and you will have no regrets. Oh yea and remember its a house there is one on every corner and no matter what you might think at 23 you will more than likely move again and that's ok.

[TheHammer]

Watching this one. In the same boat myself. I'm 23 years old and a first time home buyer

[bgbean90]

So my wife and I are 23 and have no kids, we bought a house a year ago so we can relate. What we did was bought a house that we could rent out if the market tanked. We don't plan to live here forever, we'll probably actually move in the next 1-1.5 years. The best thing to do is determine your long term goal whether you think you'll want to stay in the house a long time or if it's just your first house. I recommend a 30 year and pay double each month, that's what we do. I work in construction and the industry has its ups and downs, so we want to have the ability to not pay as much as a 15 year in case something with work happens. Good luck, buying a home can sometimes be a stressful process.

Edit: also make sure you have 20% down or else you have to pay private mortgage insurance which is throwing money out the window.

I agree with this. The best advice I received was get the 30 but pay it like a 15. If I get in a bind financially, I have the flexibility to scale back my mortgage payment. I have it auto draft out to reduce the temptation of only paying the minimum. I am paying a little more in interest this way but having the flexibility is worth it.

[txpitdog]

Not sure if it has been mentioned yet, but determine whether you can afford the house based on what the taxes will be for the purchase price, not the county's current value. If the county has the taxable value of the home at much less than the sale price, your taxes will go way up when they revalue the home after the sale.

Seen a couple folks, including myself, get crunched when their escrow jumped after the first year.

[Throwin Darts]

I agree with this. The best advice I received was get the 30 but pay it like a 15. If I get in a bind financially, I have the flexibility to scale back my mortgage payment. I have it auto draft out to reduce the temptation of only paying the minimum. I am paying a little more in interest this way but having the flexibility is worth it.

This is good advice here.

[msmock13]

Watching this one as well. Does anyone here have experience doing a piggyback loan to avoid PMI?