Home Buying Advice...

[DPG21920]

I am doing my own research and speaking with realtors/lenders and other people I know, but any advice for a first time potential home buyer?

Should DPG buy a home?

[Latarian Milton]

at least you won't need a big one and there're many small houses available in the market sold at reasonable prices. you can even buy a one-story house and build a 2nd floor inside it yourself imho

[Avante]

Trust me on this one.....location/neighbors mean everything. DO NOT BUY around/among rentals. You want to be as far away from rentals as possible. You also want nothing to do with a home with a septic tank. Space in the kitchen is huge also. Must have a garage!!!!!!!!! Ceiling fans and the swamp cooler option a biggie.

Leaving out in the country is really the way to go. Just be sure ya have/want a couple big dogs. If ya plan on living in a neighborhood do you really want traffic? Living in a cul de sac surrounded by "young" homeowners with nice lawns is the way to go.

If you're not into yard work...................

[CosmicCowboy]

If you are concerned about resale location is everything. As a general rule you want to be in an area with good schools even if you don't have kids. Ideally you want to live in the cheapest house on the block. Certainly not the most expensive. Make the seller buy a one year home warranty as a condition of the sale, that way if they covered something up for the sale and it shows up later you aren't hung with it. We already got a new water heater and a new garbage disposal on the house I just got for my daughter. If you are handy with your hands there is money to be made with a "fixer upper" if it's in the right area of town. Southtown is hot, the Monticello area is hot, as are a few other near downtown pockets but you don't want to be the pioneer in an area...you don't want to jump in until at least half of the homes have already been renovated. Interest rates are at an all time low. If you are going to do it, do it now. If you are a first time buyer with at least a 700 credit rating you can do an FHA loan for 3% down at 3.25%. IMHO real estate in SA long term will appreciate faster than 3.25% so you will be building some real equity while living in "your" house. IMHO it's a no brainer. BUY.

[leemajors]

If you are concerned about resale location is everything. As a general rule you want to be in an area with good schools even if you don't have kids. Ideally you want to live in the cheapest house on the block. Certainly not the most expensive. Make the seller buy a one year home warranty as a condition of the sale, that way if they covered something up for the sale and it shows up later you aren't hung with it. We already got a new water heater and a new garbage disposal on the house I just got for my daughter. If you are handy with your hands there is money to be made with a "fixer upper" if it's in the right area of town. Southtown is hot, the Monticello area is hot, as are a few other near downtown pockets but you don't want to be the pioneer in an area...you don't want to jump in until at least half of the homes have already been renovated. Interest rates are at an all time low. If you are going to do it, do it now. If you are a first time buyer with at least a 700 credit rating you can do an FHA loan for 3% down at 3.25%. IMHO real estate in SA long term will appreciate faster than 3.25% so you will be building some real equity while living in "your" house. IMHO it's a no brainer. BUY.

I believe he is in the Austin area.

[Blake]

Lot of unforeseen costs with being a home owner, but if you have the cash, you may as well do it now with rates being so low.

one thing I've never seen anyone talk about online but is something you need to be aware of is that if your property value goes up, your monthly payment will also go up. So if you plan to stay in the house for a long time, you'd need to go to the county appraisal office and fight it if they raise the value substantially.

Also find out HOA dues. If your house is 15 years old or younger in city limits, chances are extremely high you will be forced to pay those dues. Me personally, i hate forced HOAs with extreme prejudice, but again, that's just me.

I'd also recommend hiring a home inspector ($300) before signing........even if the house is brand new.

[silverblk mystix]

I am doing my own research and speaking with realtors/lenders and other people I know, but any advice for a first time potential home buyer?

Should DPG buy a home?


#1) Location

#2) Look into foreclosures and gov't auctions in decent areas. If it is a "hot" area - these auctions will have stiff competition - but if you score one - you can move in already having equity - as opposed to buying a new fancy 3,000 square ft and burying yourself with debt and never using 1500 of those square feet.

#3) Leave a good 5-10,000 bux aside - to handle any unexpected repairs/expenses. (I mean after move- in--you will still want to inspect everything beforehand and stay away from money pits)

#4) Ask your realtor about any programs involving tax credits and any other programs which will help now and in the future.

#5) I know this is common sense but I studied the neighborhood - and if the area isn't a new development - if it has been around and the houses are 10-15-20 years old...look at how it has been kept up - or if the owners are keeping up with their property. Graffiti, streetlights, trash, broken gates, etc.... 10-20 years is a good test to see if people got lazy and it looks like shit - or if original owners moved away and hood rats took over.

ymmv

[Blake]

#5) I know this is common sense but I studied the neighborhood - and if the area isn't a new development - if it has been around and the houses are 10-15-20 years old...look at how it has been kept up - or if the owners are keeping up with their property. Graffiti, streetlights, trash, broken gates, etc.... 10-20 years is a good test to see if people got lazy and it looks like shit - or if original owners moved away and hood rats took over.

ymmv

That's a good point. I'd add:

-check the neighborhood out at night time.
-take a look at cracks in the sidewalks and driveways around the neighborhood. It's sometimes an indicator of foundation problems.

[silverblk mystix]

That's a good point. I'd add:

-check the neighborhood out at night time.
-take a look at cracks in the sidewalks and driveways around the neighborhood. It's sometimes an indicator of foundation problems.


Yup.

In addition - this might not apply to all - but;

#1) I also scoped the neighborhood at different times - I really like the fact that kids were out and about and riding bicycles, socializing, etc...
(however - a couple working odd hours with no children in the nest yet - might disagree here.) I love to hear the kids out there playing - but - not rowdy bored looking for trouble kids - I am referring to children with educated and attentive parents playing along with their kids - or dads tossing the ball with their kids.

#2) Not really what most people would be on the lookout for...but...the county and their stance on crime --or their laxness on crime --played a big part for me. If burglars know they will get a slap on the wrist and be released immediately - they are far more prone to target your neighborhood - than the county where Judges take no shit and give tough/long sentences.

fwiw

[2centsworth]

Your first step is to get Pre-Approved for a mortgage. Once you find out what you can get approved for then start your search. Texas has a few 1st home buyer programs that can help with downpayments if you need it.

Save yourself a bunch of time and visit with a loan officer.

[Trainwreck2100]

I'm not familiar with the Austin area but look into the older neighborhoods in the decent side of town. The reasoning here is they are less likely to part of the SCAM that is a home owner's association. Which leads to my next advise, stay the fuck away from a home with an HOA

[Sportcamper]

-take a look at cracks in the sidewalks and driveways around the neighborhood. It's sometimes an indicator of foundation problems.

You have earthquakes & expansive soil in Texas?

[CosmicCowboy]

You have earthquakes & expansive soil in Texas?

We have some areas with expansive clay. Earthquakes aren't a big issue.

[Blake]

Your first step is to get Pre-Approved for a mortgage. Once you find out what you can get approved for then start your search. Texas has a few 1st home buyer programs that can help with downpayments if you need it.

Save yourself a bunch of time and visit with a loan officer.

That's if you don't get a realtor. A realtor worth his salt will set all that up for you.

[Blake]

I'm not familiar with the Austin area but look into the older neighborhoods in the decent side of town. The reasoning here is they are less likely to part of the SCAM that is a home owner's association. Which leads to my next advise, stay the fuck away from a home with an HOA

+1k

Unless you really want a newer home. Then you have no choice but to bend over and take it.....

[CuckingFunt]

I'm not familiar with the Austin area but look into the older neighborhoods in the decent side of town. The reasoning here is they are less likely to part of the SCAM that is a home owner's association. Which leads to my next advise, stay the fuck away from a home with an HOA

Not to mention that well maintained older homes often have less problems than new homes, which are typically hobbled together out of particle board, sheetrock, and scotch tape.

[2centsworth]

That's if you don't get a realtor. A realtor worth his salt will set all that up for you.

Any Realtor worth his salt will tell you that's your first step. Now a Realtor can guide you where to go, but a Pre-Approval is where to begin.

[Blake]

Any Realtor worth his salt will tell you that's your first step. Now a Realtor can guide you where to go.

I'm speaking anecdotally here from friends/acquaintances in that field.

If you start out at a bank and they don't approve you for the amount you want, you'll most likely get discouraged and give up.

A realtor will send you to multiple places that they may have connections with until you get approved for the loan you want.

again, anecdote, just my opinion, etc.

[silverblk mystix]

+1k

Unless you really want a newer home. Then you have no choice but to bend over and take it.....


No comment.

[Blake]

No comment.

You can either cry about it or enjoy it, but either way it will be shoved up in you if you buy a recently built house in a recently built neighborhood.

[Wild Cobra]

Make sure you get a home that is certified that it doesn't use Chinese sheetrock...

[silverblk mystix]

You can either cry about it or enjoy it, but either way it will be shoved up in you if you buy a recently built house in a recently built neighborhood.

Oh, that's what you were referring to. ok.

[2centsworth]

I'm speaking anecdotally here from friends/acquaintances in that field.

If you start out at a bank and they don't approve you for the amount you want, you'll most likely get discouraged and give up.

A realtor will send you to multiple places that they may have connections with until you get approved for the loan you want.

again, anecdote, just my opinion, etc.

What you're saying is hire a Realtor first. I'm good with that too as long as the Realtor focuses first on getting the buyer approved. Nothing more disappointing, and no bigger waste of time, than finding the home of your dreams and then finding out you can't get qualified.

[Blake]

What you're saying is hire a Realtor first. I'm good with that too as long as the Realtor focuses first on getting the buyer approved. Nothing more disappointing, and no bigger waste of time, than finding the home of your dreams and then finding out you can't get qualified.

Yeah, if you're going to use a realtor, go there first, imo. If you are going to go it alone, then yeah, go to the lender first.

Honestly, after further review, I'm probably splitting hairs. :lol

[DPG21920]

Thanks all. I'm defintely looking at new construction. Location is key for me (for future sale/rentability, then the home then other things (yard, amenities...).

There is an HOA but to me it's nominal ($50-90 a month) & the higher one includes front/backyard landscaping (so you know your neighbors yard won't look like garbage).

Spoken w a loan officer & have a realtor.

[CubanMustGo]

If you're a member of CU talk to them about their mortgages first. The easiest mortgage I EVER did, the least expensive one, and the one with the least paperwork is the current one we did with Randolph-Brooks. Our credit score is good but we're not richers by any means.

You will also build equity a lot faster on a 20- or 15-year note if you can swing it. The payments are way less than 2x on the 15-year note because you're paying a lower interest rate for a shorter period of time. Here is an example (principal and interest only) on a $150K home at current rates at the CU:

30 years: $695/mo @ 3.75%; total payments $250,083
15 years: $1025/mo @ 2.85%; total payments $184,515

So in return for paying ~50% more per month you pay it off in half the time and save $65K. You probably won't live there that long, but when you sell you'll have a lot more stake in the house to recoup. And after you add your escrow (if you don't put 20% down you usually have to have escrow for taxes and insurance, which would add around $500 a month for a house in this price range) the incremental difference isn't as high.

Some people will say "finance for 30 and make the extra principal payment so you have flexibility if something goes wrong", but studies have shown that people end up not making the extra payments on their own. Maybe you will be the different one.

[rjv]

have you already been pre-approved (or at the very least, have you pre-qualified) ?

[DPG21920]

Great point by Blake about a home inspector even when it's new. Worth it. Also, doing research on the new home builders. Seems like they use solid materials and go beyond min requirements to make the homes energy efficient (radiant barriers, upgraded windows...)

[rjv]

even if you go with a new home, get a realtor..they can help you get certain upgrades or incenvtives. and if you are not hell bent on picking your own options then you can even check into spec or inventory homes.

[DPG21920]

If you're a member of CU talk to them about their mortgages first. The easiest mortgage I EVER did, the least expensive one, and the one with the least paperwork is the current one we did with Randolph-Brooks. Our credit score's around 800 but we're not richers by any means.

You will also build equity a lot faster on a 20- or 15-year note if you can swing it. The payments are way less than 2x on the 15-year note because you're paying a lower interest rate for a shorter period of time. Here is an example (principal and interest only) on a $150K home at current rates at the CU:

30 years: $695/mo @ 3.75%; total payments $250,083
15 years: $1025/mo @ 2.85%; total payments $184,515

So in return for paying ~50% more per month you pay it off in half the time and save $65K. You probably won't live there that long, but when you sell you'll have a lot more stake in the house to recoup. And after you add your escrow (if you don't put 20% down you usually have to have escrow for taxes and insurance, which would add around $500 a month for a house in this price range) the incremental difference isn't as high.

Some people will say "finance for 30 and make the extra principal payment so you have flexibility if something goes wrong", but studies have shown that people end up not making the extra payments on their own. Maybe you will be the different one.

:lol funny you say that because I have sought both 30yr & 15yr loans. I'm going conventional & likely putting 5% down, but I think I will do 30 yr & Pay extra (I'm very disciplined).


have you already been pre-approved (or at the very least, have you pre-qualified) ?

Yes I have received pre-qual

[DPG21920]

even if you go with a new home, get a realtor..they can help you get certain upgrades or incenvtives. and if you are not hell bent on picking your own options then you can even check into spec or inventory homes.

That's what I've done so far :tu. using a realtor and looking at ready to move in & build homes

[rjv]

Yes I have received pre-qual

on the loan side of things i would just advise this: make sure you have no late payments between now and closing, do not open any new credit cards or get any new loans. do not pay off any debts older than one year. avoid any NSF's and keep 2 months worth of what your mortgage will be in your checking and savings account.

[DPG21920]

Good advice - no planned purchases, I have fairly min debt (only a little bit of student loans at this point) .

[rjv]

Good advice - no planned purchases, I have fairly min debt (only a little bit of student loans at this point) .

are they deferred ? if so they will not count if you get an FHA loan and they will stay deferred for at least 2 years after closing

[Blake]

Thanks all. I'm defintely looking at new construction. Location is key for me (for future sale/rentability, then the home then other things (yard, amenities...).

There is an HOA but to me it's nominal ($50-90 a month) & the higher one includes front/backyard landscaping (so you know your neighbors yard won't look like garbage).

Spoken w a loan officer & have a realtor.

$1000+ a year for lawn service, probably a gate, pool maintenance, and maybe a neighborhood party twice a year.

If you can make it rain, I guess it's no big deal.

[DPG21920]

Ya - to me, while I would obviously prefer no HOA, that extra $90 a month fee for knowing everyone's lawns will look great with no maintenance from me is worth it. That's one dinner date a month cost for my GF and I and won't throw my mortgage payment off budget at all in the range I am looking for.

[Trill Clinton]

congrats, fam. keep us updated.

[2centsworth]

Do everything your Realtor and Loan Officer say and enjoy shopping. The journey is never perfect, but it's worth it at the end.

[CubanMustGo]

Ya - to me, while I would obviously prefer no HOA, that extra $90 a month fee for knowing everyone's lawns will look great with no maintenance from me is worth it. That's one dinner date a month cost for my GF and I and won't throw my mortgage payment off budget at all in the range I am looking for.

And, unfortunately, I have seen too many new neighborhoods with no HOA turn to crap within a few years of being built out as the original owners move on and new people who don't care as much come in. It may be a $K per year but compared to what can happen to the value of your house it's a small price to pay./

[mavs>spurs]

you're in your career, finished with school, and approaching 30 years old. interest rates will never be this low again..real estate is on the rebound but still somewhat cheap. hell yeah you should buy, an MBA wouldn't have to make a thread about it and ask spurstalk.

[Blake]

And, unfortunately, I have seen too many new neighborhoods with no HOA turn to crap within a few years of being built out as the original owners move on and new people who don't care as much come in. It may be a $K per year but compared to what can happen to the value of your house it's a small price to pay./

I've also seen new neighborhoods with forced HOAs turn to crap. They end up having to call the city to come in and enforce codes.....which makes the HOA dues completely unnecessary.

Regular maintenance in front and back sounds good though. My neighborhood is in good shape, but I wish I was getting some kind of real return like that on my forced HOA investment.

[Blake]

you're in your career, finished with school, and approaching 30 years old. interest rates will never be this low again..real estate is on the rebound but still somewhat cheap. hell yeah you should buy, an MBA wouldn't have to make a thread about it and ask spurstalk.

Buying a home isn't the throwdown most think it is.

I still feel like I'm renting from Wells Fargo, yet I have to pay for all the maintenance. And even when the home is paid off, you still have to pay the taxes on your home.......the rent never ends. Look at what happened to Happy Gilmore's grandma.

Plenty of minuses to go with the pluses.

[DPG21920]

you're in your career, finished with school, and approaching 30 years old. interest rates will never be this low again..real estate is on the rebound but still somewhat cheap. hell yeah you should buy, an MBA wouldn't have to make a thread about it and ask spurstalk.

Thanks for your shot, but it is actually quite the big deal and not as easy as one may think. This wasn't a thread asking if I should buy (the "Should DPG buy a home" part was after), but advice for a first time buyer.

Orginally I was really struggling on the benefits of just renting vs ever buying. A person with a MBA would think about those things since there are strong arguments for never owning IMO (not considering personal utility).

[DPG21920]

I've also seen new neighborhoods with forced HOAs turn to crap. They end up having to call the city to come in and enforce codes.....which makes the HOA dues completely unnecessary.

Regular maintenance in front and back sounds good though. My neighborhood is in good shape, but I wish I was getting some kind of real return like that on my forced HOA investment.

Good point. I really would prefer no HOA as you said but I at least feel I'm getting decent value for it with the lawn maintenance plus seasonal flowers planted.

[mavs>spurs]

there was never an argument for renting vs buying..paying rent is throwing away money. if you buy a home and live in it for a few years you can still move and take that equity with you instead of kissing your rent payments goodbye. sure property taxes never go away, but they're not 1000 a month. deduct the interest (nonexistant right now) and the property taxes, and what's left is like putting aside that money teach month for yourself in a fund. most maintenance is any for any man to do himself. you can also pay the house off and upgrade while keeping the old house as an investment and renting it out. there really isn't a good reason for renting unless you're in your early 20s. we're all men here let's act like it. the benefits to owning your own home are endless.

[Blake]

there was never an argument for renting vs buying..paying rent is throwing away money. if you buy a home and live in it for a few years you can still move and take that equity with you instead of kissing your rent payments goodbye. sure property taxes never go away, but they're not 1000 a month. deduct the interest (nonexistant right now) and the property taxes, and what's left is like putting aside that money teach month for yourself in a fund. most maintenance is any for any man to do himself. you can also pay the house off and upgrade while keeping the old house as an investment and renting it out. there really isn't a good reason for renting unless you're in your early 20s. we're all men here let's act like it. the benefits to owning your own home are endless.

you're assuming you'll have equity when you sell.

fyi, your few first years of mortgage payment puts just a slight dent into the principal. It goes almost exclusively into paying pure interest.

[mavs>spurs]

yeah i'd advise not getting a house until you're settled in somewhat to your career..but dpg is almost 30, has an mba, and moved to austin for a promotion where he enjoys living. it's a safe a bet as any that he will probably be there fore the foreseeable future..its really a no brainer in his situation. he'll have equity if he decides to move, and any equity is better than the 0.00 you'll get from renting. plus..it's yours so you don't have to deal with a landlord and can do what the fuck you want in the meanwhile.

[DPG21920]

There are many incredible arguments against owning a home, M>S, but I don't want to argue with you brah. I have decided to buy (assuming I can find something that makes sense) and was just sharing with people and looking for some friendly advice.

[mavs>spurs]

well i'm glad you're making the obvious right choice even if you feel the need to try to justify your past behaviors. regardless, you're now on the right track :tu

[Blake]

...and can do what the fuck you want in the meanwhile.

Lol unless the HOA doesn't let you

[mavs>spurs]

nobody ever said you had to live under one

[Blake]

True. Almost impossible not to be forced into one if you want to live in a nice neighborhood. But true.

[benefactor]

Shopping for a house is fun...but once you get one picked out there are some up front costs to worry about. Have about a thousand bucks set aside for those(earnest money and inspection are the two off the top of my head).

[CosmicCowboy]

Shopping for a house is fun...but once you get one picked out there are some up front costs to worry about. Have about a thousand bucks set aside for those(earnest money and inspection are the two off the top of my head).

A thousand bucks isn't near enough unless you are buying a shithole.

[benefactor]

I guess it depends on what you pay for and what you get the seller to pay for. I don't remember paying much more than a thousand or so out of pocket during the process of buying my house and my house isn't a shithole. However, if one is purchasing a richer crib like I'm sure you live in I'm sure its much more.

[DPG21920]

^ Bene, that was just a richer comment. It can range from 1K to 4K and you are correct, the 1K is even for nicer homes I have seen too.

[CosmicCowboy]

I guess it depends on what you pay for and what you get the seller to pay for. I don't remember paying much more than a thousand or so out of pocket during the process of buying my house and my house isn't a shithole. However, if one is purchasing a richer crib like I'm sure you live in I'm sure its much more.

Not a richer, just reality.

Where are you getting a 0% down loan? FHA is 3.5% plus inspection, appraisal, title fee, and loan origination fee. Now you may have financed all the closing costs but I guarantee upfront costs are a hell of a lot more than $1000.

[benefactor]

I wasn't talking about putting money down for the loan...just the random costs that lead up to closing. I had equity from the house I sold that I dropped down on my new loan.

[benefactor]

^ Bene, that was just a richer comment. It can range from 1K to 4K and you are correct, the 1K is even for nicer homes I have seen too.
:tu

[CosmicCowboy]

I wasn't talking about putting money down for the loan...just the random costs that lead up to closing. I had equity from the house I sold that I dropped down on my new loan.

He's buying his first house and isn't rolling over equity. I just bought a 150K house for my daughter that closed in January on a 3.5% down FHA loan and I had to take about 7K to the table plus the 1K I had put down as earnest money.

[DPG21920]

CC, he's talking about earnest money. That is where the 1K comes from. Closing costs and such I would likely be getting handled. I'd be putting about 5% down, but Bene was referencing earnest money.

[lebomb]

Which leads to my next advise, stay the fuck away from a home with an HOA


FUCK that shit. Ive lived in two homes.........one with and one without HOA. The HOA is definitely the way to go. Without it, this is the shit you get.......a neighbor that never put grass in his BRAND NEW homes backyard, and 10yrs later the weeds have spread to all the neighbors around him. You get blessed with a neighbor that doesnt keep his yard, house or fence up. He paints part of the fence red when it was new, decided he didnt like the red, and leaves the red painted boards that way for the next 10yrs. The fence if falling down and he props a rock up against it to keep it upright. The neighbor changes the oil to his car in the driveway as well as ANY other automotive repair. Ive seen this fool drop a tranny in the front yard. WTF is this???? Pep Boys and shit????

Now with the HOA, none of that dumb shit could have happened. Also, they make sure everyones yard is kept neat so the resale values stay at the top. Fuck that shit........HOA or forget it for me. :nope

[Blake]

Now with the HOA, none of that dumb shit could have happened. Also, they make sure everyones yard is kept neat so the resale values stay at the top. Fuck that shit........HOA or forget it for me. :nope

What makes you think any of that can't happen in a neighborhood with an HOA?

[DMC]

I'd think land then home. Find a plot of land in an area you'd like to live (within reason) and find out the cost of building a home there.

Depending on your family growth plans, stay at least 2 to 3 bedrooms because anything less is really hard to sell.

If you already know what home you want, it's just location now. You'll probably want to fit in with area homes so take a ride through these neighborhoods and get an idea of what size you want, then maybe find one on a cul-de-sac to keep traffic from going by your home all day. Consider the landscaping as well, and any expansion plans have to fit within that framework else you have a lot more money to spend.

Definitely want to know who the neighbors are, and don't buy a home next to someone who's entire extended family lives with them or visits too often, else your personal stuff becomes window shopping for thieves.

[DMC]

FUCK that shit. Ive lived in two homes.........one with and one without HOA. The HOA is definitely the way to go. Without it, this is the shit you get.......a neighbor that never put grass in his BRAND NEW homes backyard, and 10yrs later the weeds have spread to all the neighbors around him. You get blessed with a neighbor that doesnt keep his yard, house or fence up. He paints part of the fence red when it was new, decided he didnt like the red, and leaves the red painted boards that way for the next 10yrs. The fence if falling down and he props a rock up against it to keep it upright. The neighbor changes the oil to his car in the driveway as well as ANY other automotive repair. Ive seen this fool drop a tranny in the front yard. WTF is this???? Pep Boys and shit????

Now with the HOA, none of that dumb shit could have happened. Also, they make sure everyones yard is kept neat so the resale values stay at the top. Fuck that shit........HOA or forget it for me. :nope

That's all bullshit. All the HOA does is issue threats. Unless your neighborhood is really upscale, the HOA is toothless, and just collects funds. Even the older neighborhoods have HOAs, go look at the yards and the disabled cars sitting on the streets.

Get you two or three acres outside of town with a single level home on it. You can park anything you want on your land and no fucking HOA.

[CosmicCowboy]

CC, he's talking about earnest money. That is where the 1K comes from. Closing costs and such I would likely be getting handled. I'd be putting about 5% down, but Bene was referencing earnest money.


I wasn't talking about putting money down for the loan...just the random costs that lead up to closing. I had equity from the house I sold that I dropped down on my new loan.

No he was talking about all the up front costs related to closing. You have the inspection, the appraisal, loan origination fees, title insurance fee, and only putting 5% down, the mortgage insurance fee (which is a chunk).You also have to prepay the first three months insurance at closing. It's a hell of a lot more than $1000.

[2centsworth]

No he was talking about all the up front costs related to closing. You have the inspection, the appraisal, loan origination fees, title insurance fee, and only putting 5% down, the mortgage insurance fee (which is a chunk).You also have to prepay the first three months insurance at closing. It's a hell of a lot more than $1000.


There's upfront cost and there's closing cost. Separate the two in your post.

[CuckingFunt]

FUCK that shit. Ive lived in two homes.........one with and one without HOA. The HOA is definitely the way to go. Without it, this is the shit you get.......a neighbor that never put grass in his BRAND NEW homes backyard, and 10yrs later the weeds have spread to all the neighbors around him. You get blessed with a neighbor that doesnt keep his yard, house or fence up. He paints part of the fence red when it was new, decided he didnt like the red, and leaves the red painted boards that way for the next 10yrs. The fence if falling down and he props a rock up against it to keep it upright. The neighbor changes the oil to his car in the driveway as well as ANY other automotive repair. Ive seen this fool drop a tranny in the front yard. WTF is this???? Pep Boys and shit????

Now with the HOA, none of that dumb shit could have happened. Also, they make sure everyones yard is kept neat so the resale values stay at the top. Fuck that shit........HOA or forget it for me. :nope

An HOA doesn't prevent any of that stuff from happening. It just sends letters to the homeowner and charges fines when it does happen.

[GoodOdor]

I'm in the same boat as DPG - mid 20's with very little debt and with some savings, I'm thinking at the end of this year might be a good time
to go for it - rates aint gonna be this low forever tbh.

[CosmicCowboy]

I'm in the same boat as DPG - mid 20's with very little debt and with some savings, I'm thinking at the end of this year might be a good time
to go for it - rates aint gonna be this low forever tbh.

Good plan. I bought my first house at 23.

[GoodOdor]

Good plan. I bought my first house at 23.

How much did you put down?

I can probably save up to around 40k by the end of this year, but houses in the bay area are pretty damn expensive.

There are probably 100k ones in the easy bay, but those are likely to be dumps.

[silverblk mystix]

How much did you put down?

I can probably save up to around 40k by the end of this year, but houses in the bay area are pretty damn expensive.

There are probably 100k ones in the easy bay, but those are likely to be dumps.


Is Sonoma too far out for you? Might get a lot more home for the $ and a still really nice area.

[GoodOdor]

Is Sonoma too far out for you? Might get a lot more home for the $ and a still really nice area.

A bit too far. I don't have problem commuting - I already do an hour each way(live in Sunnyvale, work in SF) but that's around 2 hours from SF(not sure they even have a caltrain).

[silverblk mystix]

A bit too far. I don't have problem commuting - I already do an hour each way(live in Sunnyvale, work in SF) but that's around 2 hours from SF(not sure they even have a caltrain).


Too bad. So San Jose or nearby...still very nice areas.

[lebomb]

An HOA doesn't prevent any of that stuff from happening. It just sends letters to the homeowner and charges fines when it does happen.

Worked in my neighborhood.

Without HOA its a free for all. Anyone can do what they want. Another neighbor where I just left......put a fucking carport on the front of his house. A carport. They would have never flied where I used to live with HOA.

[CosmicCowboy]

How much did you put down?

I can probably save up to around 40k by the end of this year, but houses in the bay area are pretty damn expensive.

There are probably 100k ones in the easy bay, but those are likely to be dumps.

I put down 5% and paid another 200 basic points at closing to buy the interest rate down to 12%.

[Blake]

Worked in my neighborhood.

Without HOA its a free for all. Anyone can do what they want. Another neighbor where I just left......put a fucking carport on the front of his house. A carport. They would have never flied where I used to live with HOA.

Holy fuck! A carport?!?!?!?!? Damn free for allers!

[CuckingFunt]

Worked in my neighborhood.

Without HOA its a free for all. Anyone can do what they want. Another neighbor where I just left......put a fucking carport on the front of his house. A carport. They would have never flied where I used to live with HOA.

There are a lot of shitty neighborhoods that have HOAs. You want to live in a neighborhood where the homeowners don't want to put up rickety carports or leave fences half painted and falling apart, not a neighborhood in which the threat of HOA fines are the only things keeping the homeowners from doing exactly that.

[reason]

My neighborhood doesn't have an HOA and we all like it that way. Don't need the hassle of an HOA or the damn fees and threat of losing your home over them

[Koolaid_Man]

I am doing my own research and speaking with realtors/lenders and other people I know, but any advice for a first time potential home buyer?

Should DPG buy a home?

Absolutely..

In San Diego there's a town called Midget town they see homes exclusively for short people..below is a link to the article entitled:
Hidden San Diego: The Legend of the Munchkin Homes
http://sandiego.about.com/od/uniquelysandiego/a/midget_homes.htm


Check Midget Realty for good deals: http://www.midgettrealty.com/

Best Wishes

[benefactor]

There's upfront cost and there's closing cost. Separate the two in your post.
Yup. I paid $500 in earnest money, a few hundred for the inspection and a few hundred for the appraisal. I was probably a little more than a thousand total but not anymore than 2k. The rest of that he mentioned must have rolled into closing costs because I don't remember paying out of pocket for any of it.

So I stand corrected by the resident expert...have 2k laying around.

[DPG21920]

Well guys, it seems to be getting pretty close...Found the home I want and have my realtor negotiating a few things they hopefully accept. At that point, it would be a new build and then I would have my first home. Meeting with the builder tomorrow to see what they say about our offer.

[benefactor]

Good to hear. Best of luck man.

[Koolaid_Man]

Well guys, it seems to be getting pretty close...Found the home I want and have my realtor negotiating a few things they hopefully accept. At that point, it would be a new build and then I would have my first home. Meeting with the builder tomorrow to see what they say about our offer.

make sure that both you and John's name is on the mortgage contract...

[DPG21920]

Today appears to be the day. Meeting with the builder in a few to review our offer.

[DPG21920]

Well nothing is official until the closing table is done, but it looks like I'm a first time home buyer. Accepted my offer, loan came through. Just have to design the finishing touches as it is a new build.

[Cane]

Godspeed but here's some late advice especially if you're fortunate enough to design your own home:

1. Separate bathrooms in the master bedroom. This is essential for less drama in a long lasting relationship unless you don't give a damn about htat

2. I like both gates and HOA's. Sure a douche can still be a douche without that stuff, but it still helps a little bit

3. Save $$$ for hail damage

4. Rock garden. Unless you like to garden and maintain a lawn

5. Keep your garage clean from the start or you'll just regret it later on

6. Sound deadening. If you can build your own home then you can get some nice sound deadening in your house if you like to play instruments or just jam out. Sound deaden the theater room or the man cave if you are going that far

Your mindset is going to change so much going from a renter to a buyer. Prepare to get annoyed by neighbors and things that wouldn't have annoyed you as much before

[CubanMustGo]

Grats. Now the fun begins. May your neighbors be friendly and the neighborhood be kept up as long as you're there, HOA or no HOA.

Don't forget to file your homestead exception as soon as you can (may be next year). Won't save you a fortune on property taxes but everything helps.

[Darius McCrary]

What can someone expect to pay a realtor when getting a house? What's reasonable commission?

[Blake]

What can someone expect to pay a realtor when getting a house? What's reasonable commission?

When buying, you pay 0 on commission. The seller generally pays the commission on the sale to the agents involved.

Google says commission is about 6% where the broker and agent usually split it 3%/3%

[benefactor]

When buying, you pay 0 on commission. The seller generally pays the commission on the sale to the agents involved.

Google says commission is about 6% where the broker and agent usually split it 3%/3%
From what I remember this sounds correct.

[CosmicCowboy]

In a more typical sale there is an agent/broker representing the seller and an agent/broker representing the buyer. Each broker gets the 3% and the agents gets whatever percentage of that was negotiated with their broker.

[Blake]

In a more typical sale there is an agent/broker representing the seller and an agent/broker representing the buyer. Each broker gets the 3% and the agents gets whatever percentage of that was negotiated with their broker.

I wonder how often a broker/agent gets to act on behalf of both buyer/seller, getting the full commission all to themselves. Seems it would have to be extremely rare.

[LkrFan]

Location location location for a myriad of reasons. Stay outside of large counties like Bexar. You'll save a ton on property taxes over the long haul. Also, make a 13th payment every year if you can afford it. You can designate that extra payment to go towards principle. This will help you pay your crib off years earlier (especially if you have a 30-year mortgage). Pay twice a month (if allowed) also helps you pay your crib off faster (i.e. paying $1K every 2 weeks vice $2K/month).

Good luck DPG. Owning a house >>>>>>>> renting. Do it and don't look back.

[Blake]

Living out in the sticks has its pros and cons.

Yeah, you save on taxes, but you may end up paying the difference up in gas/car maintenance, commute time, garbage service, fire/police, septic tanks and well water. etc.

I've heard different people say different things regarding cost of living outside city limits.

[LkrFan]

Living out in the sticks has its pros and cons.

Yeah, you save on taxes, but you may end up paying the difference up in gas/car maintenance, commute time, garbage service, fire/police, septic tanks and well water. etc.

I've heard different people say different things regarding cost of living outside city limits.
Agreed. I guess I should clarify. Look for homes on the outskirts of large counties. As long as you can access the things you need (schools, grocery stores, jobs, etc.) within a reasonable time, you're good.

[CuckingFunt]

I wonder how often a broker/agent gets to act on behalf of both buyer/seller, getting the full commission all to themselves. Seems it would have to be extremely rare.

It's pretty common. It has to be disclosed and is completely above board if the Realtor is worth a damn. The agents in my old office would sometimes drop the commission down to 5% if we were handling both sides of the deal, especially if it was a big apartment building or something, but not always. You typically end up doing far more than double the work, so the bigger commission is pretty well justified.

[Blake]

It's pretty common. It has to be disclosed and is completely above board if the Realtor is worth a damn. The agents in my old office would sometimes drop the commission down to 5% if we were handling both sides of the deal, especially if it was a big apartment building or something, but not always. You typically end up doing far more than double the work, so the bigger commission is pretty well justified.

huh.

I would have also thought it would be slightly less work, much less 'far more than double', since the one agent doesn't have to deal with another outside agent.

[DPG21920]

Location location location for a myriad of reasons. Stay outside of large counties like Bexar. You'll save a ton on property taxes over the long haul. Also, make a 13th payment every year if you can afford it. You can designate that extra payment to go towards principle. This will help you pay your crib off years earlier (especially if you have a 30-year mortgage). Pay twice a month (if allowed) also helps you pay your crib off faster (i.e. paying $1K every 2 weeks vice $2K/month).

Good luck DPG. Owning a house >>>>>>>> renting. Do it and don't look back.

Thanks man. I went with location overall. I'm living in Austin (which I love). Sacrificed a big lawn to get the location that was much better. Definitely need to see if I can do the twice a month payment & I was planning on doing an extra payment every quarter too. Originally I was going to do a 15 year but ultimately decided against bc I likely will only be here for 10 or so years & am disciplined enough to make extra payments.

[LkrFan]

Thanks man. I went with location overall. I'm living in Austin (which I love). Sacrificed a big lawn to get the location that was much better. Definitely need to see if I can do the twice a month payment & I was planning on doing an extra payment every quarter too. Originally I was going to do a 15 year but ultimately decided against bc I likely will only be here for 10 or so years & am disciplined enough to make extra payments.
Anytime man. :tu Being a homeowner is the best. Just wait until you move into your crib. To know you own it - there's not too many other things in life that's better. And Austin is underrated and a nice location in itself tbh. SATX is a little over an hour away. Dallas is about 3 hours away and H-Town is about 2.5 hours away.

Another thing. Do your homework. There are several sites out there that can help you with amortization. An amortization schedule will help you estimate your monthly payments. Here's a pretty good link: http://www.amortization-calc.com/. It's always good to make an informed decision when you're making an investment of this nature.

[DPG21920]

Definitely have that all broken down. I just did this in my name only so that we (my GF & I) qualify on one income only. Our monthly payment won't change hardly at all from our current rental expenses (main differences are the heating/cooling of a home v apartment ect..).

[leemajors]

what area of town dpg?

[CuckingFunt]

huh.

I would have also thought it would be slightly less work, much less 'far more than double', since the one agent doesn't have to deal with another outside agent.

You don't have to deal with an outside agent, but you have to do their work. There's also more effort that has to be put into assuring both buying and selling parties that you're working in their best interests, since they typically have opposing goals.

Our office actually tended to avoid double ended deals unless at least one of the clients involved was someone we trusted and worked with frequently. We'd refer either the buyer or seller to another Realtor with whom we had a good working relationship instead. Even with the bigger commission those deals were often more trouble than they were worth.

[CubanMustGo]

Yep, because in a double-ended deal who exactly is the realtor really working for? The seller, the buyer, or the firm? Most people want someone that represents primarily their interests, and that's near impossible if the realtor has to answer to the other party as well.

[DPG21920]

what area of town dpg?

South Austin - about 6 miles south of downtown

[CuckingFunt]

Yep, because in a double-ended deal who exactly is the realtor really working for? The seller, the buyer, or the firm? Most people want someone that represents primarily their interests, and that's near impossible if the realtor has to answer to the other party as well.

It's not impossible, it just requires a real estate agent who isn't a greedy asshole. And, sadly, they're in short supply. It does tend to work better when dealing with investors than when dealing with a personal home, however, no matter the other relationships involved. Investors are pretty easy to please so long as the numbers work out.