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Thinking about buying a house...input needed

Discussion in 'Members' Lounge' started by civicious, Nov 11, 2008.

  1. civicious

    civicious FüK-VTEC VIP

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    So with the housing market the way it is, I'm seriously considering buying a house. I'll be looking at about $75k for a 1400 sq. ft. 3br/2bth in the same neighborhood that I'm renting a house in now, and with all associated taxes and such I'd be looking at about $750-800 a month. I'd have a fixed interest rate of around 5%. I'm just generally looking for any info or need-to-know type things associated with purchasing a house.

    I don't want info from someone who's 18 and who's sister's boyfriend's cousin just bought a house, I'm really just looking for info from those of you who are more...er...'established'. Clayton, B, Mike, Steve, etc....

    Thanks in advance, guys.





    oh, and FWIW, I'm doing great, love my new job at Nissan, haven't wrecked anything on the street or gotten a ticket in over a year, haven't touched the CRX or the Chevy in about the same amount of time, and Trancend's album and video will be released sometime shortly after the 1st of the year (so go buy it in stores!).
     
  2. reckedracing

    reckedracing TTIWWOP VIP

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    I'd say now is a good time to buy. And if you can still score a 5% fixed mortgage then I'd say go for it.

    Mortgage rates have been rising as credit gets tightened.
    I'd say the housing market is coming close to the end of the drop.

    5% will run you about 69,9K for interest over the life of the loan
    7% will run you 104,6K.

    You're gonna save yourself a huge chunk of change if you lock in now before the rates go up in your area.
     
  3. chestercheeto48

    chestercheeto48 Senior Member VIP

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    Just bought a house last March. The only thing I can tell you is to follow the basics: Home inspection, shop around for rates, make sure you can truly afford the home and all of it's hidden costs, etc. I am so glad we decided to purchase when we did. The house we got was with a reloc. company and started at 24X,XXX.XX we ended up picking it up for 208,500.00 after it had sat for a couple of months. Remember you are in the power position as the buyer and don't settle. Good Luck!
     
  4. Airjockie

    Airjockie Watanabe Whore!!!

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    It's a buyers market now, if only the banks are willing to give the loan. Get your credit rating as high as possible, make sure that the house you are buying has a garage, or a place to erect one. Don't fall in love with just one house...keep your options for others in the back of your mind. Location is important. Don't do a fixer-er-upper, unless you can pull more money to afford the repairs. Get as much money as possible for a down payment, if you have to, borrow...the more down, the pmi is gone. Try to get as many points as possible, the lower the rate, the better. Don't let a ghey fag give you color options for paint when your shopping, pastels only.

    yada yada yada...

    welcome back. :)
     
  5. cheese9988

    cheese9988 Senior Member VIP

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    We just bought ours in June, 6.125% fixed on $85,000 (houses are dirt cheap up here).

    Best advise I could give, make sure your lawyer, banker and real estate agent know each other and work together. Will make life that much easier. We used an independent bank agent who knew our real estate agent. So if the bank needed something done, like an inspection or repair, the bank agent would communicate that with us and the real estate agent.

    Our real estate agent knew the city very well, all the rough neighborhoods, types of houses, where the houses were, etc. Make sure yours is experienced in your area.

    Our bank agent knew the maximum amount we wanted to spend, so he included the closing price, taxes, down payments and closing costs into different scenarios so we knew what we were spending on each house we looked. There are alot of agents that rely on you to figure this stuff out, so don't get screwed.

    Our lawyer didn't do as much into the end, he received the paperwork and we signed paperwork for a couple hours.

    Good luck.
     
  6. Airjockie

    Airjockie Watanabe Whore!!!

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    Also go down to the city hall, and find out as much info on the house as possible....

    My case, the PO had bought the house for $80,000...and listed it for $150,000 two years later, and he did nothing to the house except have a neighbor install a new garage door....I didn't know that, and I placed a bid at the asking price. So he basically got free money. But if the market would have stayed the same, my house would have been around $300ish with all the money and work done...now I'd be lucky to get $230K's for it right now...so I'm sitting on this house, and I love it.

    The wife got $20,000 from her dad two weeks ago, so now back to more repairs.... :)
     
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  7. cressidakiller

    cressidakiller New Member

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  8. civicious

    civicious FüK-VTEC VIP

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    The house is brand new - it hasn't been built yet; thus, I won't be worried about fixing anything right away. The neighborhood I'll be buying in is the same neighborhood that I've lived in (renting) for about a year and a half. One of my good friends from back home has lived here about 2 years, and I'm very close with several other people in the neighborhood. The HOA isn't too bad, but then again it's a VERY nice 'light' neighborhood (ahem) and everyone keeps their houses clean, grass mowed, etc. All the houses have 2-car garages, so the garage space isn't an issue. From what I've seen with everyone else's houses in the neighborhood, the houses don't have any types of problems with anything falling apart, wearing out, etc. I'll get to pick-and-choose all my appliances prior to the house being built, although I'm not going to go too flashy with anything in order to save money overall. I'm going to, for the most part, get all the appliances, lighting, etc. bone-basic to save cost initially, and then I'll upgrade over time.

    I'm leaving work early today and I'm going to go get all the paperwork for the house and apply for financing, and take all that to my lawyer to have him look it all over before I sign anything. From what I'm understanding so far, I'll have to pay $1000 up front when I initially sound all the paperwork, and then another $2-3k once the house is finished (which will take 3 to 4 months) for the closing costs.
     
  9. chestercheeto48

    chestercheeto48 Senior Member VIP

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    Be careful and make sure that the construction/development company is not in any financial trouble and will definately be able to finish the construction on the house. There are a couple of developments in my area that gathered downpayments and the project fell through in the end due to low sales.
     
  10. Briansol

    Briansol Admins Admin VIP

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    get a realtor who doesn't suck.

    having a good realtor is the most important thing in buying a house.

    Sure, you can do it on your own, but having a realtor to do things you don't know about and plan you through the purchase is so worth the 3% IMO. I used the same one twice. If/when I sell/buy again, i hope she's still in the business.

    don't put a DIME down on the house until you have seen proof that the building department has given it a CO (certificate of occupancy). New houses must pass this before it can be bought.

    You shouldn't need to see a lawyer until closing.

    basically, it goes like this.
    Get a pre-approval letter from a mortgage lender for X amount.
    find a house at or below X amount within 45 days (usually the time they allow that approval to be outstanding before you need to get re-approved)
    create offer, and along side, generally you put $500 payable to the seller realtor right then and there to prove your offer is serious.
    once offer is accepted or re-countered, you follow up with $500 to lock it in.
    This initial $1000 will be shown as a credit on your closing paperwork.
    assuming the house is done and ready to be owned, wait 30-45 days to get closing together and plan a closing date at the lawyer office. This wait is usually dictated by the lender as they need time to get funds together.
    you will need to pre-pay a whole year of home owners insruance. Be sure to get your insurance agent in contact with your lawyer to coridinate paper work ahead of closing.
    your couty may be different, but here property taxes are also due up front.
    Close as close to the 1st of the month as possible, as interest isc calculated per day from the 1st of the month. depending on your area, this may be cheap, or expensive. mine was $2800
    I closed on the 15th because the sellers weren't ready on the 1st. I made them pay me back $2k at closing to make up for it.
    meet with the lawyers, sign your life away.
    You'll probably spend about 1200 for the layer/paper work/title insurance/title search/fed ex fees/etc.
    your Realtor gets paid by the seller usually 3%.
    all the taxes, fees, etc are worked into closing as well.
    Your lawyer's assistant should call you that morning with a final figure. You will need a bank check.

    My condo (145k) cost me about 3500 cash to close.

    My house ($325) cost me $8,500.


    your house is significantly cheaper, and so is land value/taxes in texas, so i think you're on point with 2500-ish for closing costs.


    going forward, your mortgage payment will include principal/interest as usual, but will also include your local property tax and PMI and home owners insurance.
    so, make sure you factor in that couple hundred bucks a month.

    Mine comes out to 700/month over the top of the P&I payment (500 of which is property taxes) so keep that in mind. Don't just assume 800 bucks is 800 bucks. you'll probably be at 1200+.
     
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  11. Airjockie

    Airjockie Watanabe Whore!!!

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    Mine had a mortgage at $1100ish, no PMI, just taxex and insurance, and the final bill is $1470ish....

    and then add on the $62K HELOC loan (rebuild house) I pulled, and thats $400 a month...$1900ish for a pimp pad is not bad, unless your not making any money to pay for it. But I also have a 15 year fixed on the house, and the normal 30 year on the HELOC loan, after about 11 years, the house is payed off.... (but I want it payed off ASAP, so I can really start buying toys....hheehehe)
     
  12. civicious

    civicious FüK-VTEC VIP

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    Awesome, exactly the kinda info I was looking for. Thanks guys.

    I'm about to leave work and go start getting paperwork and shit together, I'll keep updating this.


    Thanks again
     
  13. jeffie7

    jeffie7 Wrong Whole! VIP

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    Do keep in mind when you buy from a home builder, they will stick you with all kinds of fees, and the price they're listing is for a house that doesn't have half the chit they show. they could easily tack on another 1-2-3-4K in closing cost just in their own fees.

    Another thing is if you do buy a house, get extra insurance, I'm not sure how but some how the house will sink 5 feet into the ground or somehow turn upside down one night while you're sleeping.

    To give you an example of home builders houses, I was looking at some new town houses before buying this one, they were listed at from the 280s (cheap for this area!) first off, they sell the houses before they were built and you had to agree to buy it before even seeing it, starting at the 280s, that meant that you didn't get all the bathrooms, no finished basement and nothing more then the cheapest of cheap parts from flooring, carpet, to sinks and hell I don't even think you got a fridge or microwave. Then for 280 I think the lot fee (county fee for new buildings) was like 5K or so and that was passed on from the builder to the buyer.... closing cost.... as with a bunch of other builder fees from the county that get handed down to the buyer. In the end a 280K town home with normal options built the way they list them ends up being around 380K and then factor in around 20K+ in closing cost since all fees are past down and there's no chance of getting them to help on closing cost.

    Loans are harder to get now, you must have great credit to pull in a good loan with out buying down the rate, and at 5% you're CLEARLY buying down the rate. FHA was 0% down, then it went to 3% and now it might be 5% most of the low % loans are FHA and they also carry mortgage insurance. mortgage insurance is around $230 a month on top of my loan. for 75K I'm thinking more like 75-100 a month.

    so factor in having maybe 5% I could be wrong and it might be 3.5%... check into it... factor in that you must HAVE THAT cash, you cannot borrow it, your parents can gift the money to you but it must be a gift and you have to document it, also showing that they did not borrow the money. you must show their bank statements showing that they had the money in the first place before giving it to you.

    The seller cannot help with the down payment, once again you must show that you have it. all FHA stuff....

    I believe my mortgage is around 1800-1900, add tax, mort insurance, its 2230. then there's 94 for HOA and 60 or so for home insurance (required for FHA loan)
     
    Last edited: Nov 11, 2008
  14. eg6sir

    eg6sir Supa Mod Moderator VIP

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    i bought a house last march and i literally looked at houses for 4-5 months.. 35+ houses.. i put my realtor through hell.. hahah.. he was a buddy though

    got ours.. 4 bd 2 bth 1600 sq ft 9950 sq ft lot.. $150000.. 5.5% fixed
     
  15. jeffie7

    jeffie7 Wrong Whole! VIP

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    You must have some high taxes! my taxes are around 2800
     
  16. civicious

    civicious FüK-VTEC VIP

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    Well, they ran my credit score...













    735.




    I'm buying the house.




    A very good friend of mine that I've known for years bought pretty much an identical house to mine about 2 years ago, and so I'm fully aware of what the house will come with and what won't, as far as upgrades. I'm figuring about $12k in upgrades into the final cost of everything, which is going to end up being about $87k with all the upgrades and such (fridge, washer, drier, etc). Pretty much how it's going to work, from my understanding thus far, is I'm going to pay $1k this Friday, sign a buncha paperwork, and then they're going to build the house, which will take 4 to 5 months. Once the house is build, I'll pay my closing costs and such, which will be between $4-5k.


    I'm still going to have my attorney look over all the contracts and such (I don't have to pay attorney fees, by the way...so it's not hurting anything to have him look over everything I sign), but it's pretty much a done deal unless I change my mind before Friday.
     
  17. jeffie7

    jeffie7 Wrong Whole! VIP

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    If ever there's advice from me that you take in, please let this be it.

    Step the F back away from the house. That house is no different then a girl you just met last week and youre already wanting to get married to her. STOP! The market is down, and it has more room to go down, right now is a great time to buy as with 1-2-3 months from now, it will also be a great time to buy.

    Go get yourself a legit real estate agent, they're 100% FREE, tell them you want to buy that house but someone knocked some sense into you and told you to look at the other few hundreds/thousands of options. Again they're 100% FREE!!!!!!! (granted they make money off your closing cost) but that's not the point, you use them, look at houses for 2-3 weeks if you see nothing, then buy the house you're talking about. If you don't buy it... it will still be there after 2-3-4 weeks hell, 2-3-4 months even. Just slow down and look at your options, if you buy this house its like settling for the first girl you sunk your junk into.

    Rushing into any item that cost over $50K is a really stupid move. How is that area for resale value, how is that county for taxes? what if you moved to the next county? might be slightly more taxes, but have better schools over there making for a better resale value for a small family, again you're rushing into this and I feel you're making the biggest mistake you could ever do, even more so since it would be your first house.

    Take your time.
     
  18. eg6sir

    eg6sir Supa Mod Moderator VIP

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    yea.. definitely dont buy the first thing you see.. at least look at 15-20 houses before choosing.. who knows you may find something you like more and it may be cheaper..
     
  19. Briansol

    Briansol Admins Admin VIP

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    my taxes are 5200 a year.

    we have land, you don't. :)

    we also don't have a 'school tax' nor a single toll road in the entire state. it all evens out in the end...

    I honestly totally agree.

    Let them build it first.

    It will sit. you still have to wait 5 months anyway.

    you'll get a better price.
    you might find something else that's better in the mean time.
    etc etc.

    werd.


    If you don't have 10k in the bank for the house right now, you can't afford it.
    half will be used for closing, and since the place doesn't come with appliances, the other 5 is already gone so you can cook and not have spoiled milk.

    On top of that 10k, if you don't have 6 months of living expenses (call it 8-10 grand? probably more with the mortgage) in cash in the bank right now, you can't afford it.

    If you lose your job, or get hurt, or whatever and can't work, you don't want to lose your house over it. It's not like renting where you can just move anywhere. if you default on a house, you won't own another one until you're 45. no one will lend to you again. ESPECIALLY now.


    If you have 18k in your bank sitting and 0 credit card debt, then i would say you're ready.

    If you don't, you need to slow your roll before you become a statistic on the forclosure graph.
     
  20. Briansol

    Briansol Admins Admin VIP

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    I looked at EVERY house priced 250-350 everyday for 8 weeks before i even called my realtor to start looking in more detail.

    get on realtor.com and browse around.

    After i've seen every house, i know what things are worth, and i was ready to start seeing things in certain neighborhoods.
    I did about 15-20 tours. 18 looked great in pictures, but were piles of shit in person. 19 i got outbid on while I was waiting for my condo to sell (and it went into contract the very next day :( ) 20, i live in. :)
     
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