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You need to stick with your original 150K budget. With taxes and insurance that is gonna hit you right in the 28% of gross income sweet spot that is generally considered to be the most you want to spend on housing.
Jail sounds awesome.
You need to stick with your original 150K budget. With taxes and insurance that is gonna hit you right in the 28% of gross income sweet spot that is generally considered to be the most you want to spend on housing.
I totally amSo basically not taking anyone's advice, I don't think I'm gonna take more than 150k. However, the sad reality is that prices around here are crazy - even
500 sqf condos in ty area are around 200k......if it comes down to it, I'm willing to pay a little higher monthly payment, still better than rent, tbh....
What's your opinion on putting 10% down instead of 20%? If PMI is only 100 a month, I think it's worth having a little emergency fund....putting 20% down on a 200k condo
Will basically wipe me out, and that's not even counting in the closing costs/etc.
Absolutely only put down 10% (especially with interest rates low) and keep the liquid money. There are many reasons for this (both financially speaking (you can likely earn more money investing that money) & logically speaking (you can never have enough savings) ).
Then as you get more $, you can make extra payments (only when it's comfortable) and get the same result. Keep in mind, if you pay extra, you will save yourself interest too and if you don't plan on living there forever, the interest becomes less of a concern.
If you are a first time home buyer I'd do a FHA 3.5% down at less than 4%. pay the PMI at closing in cash and keep the $36,000 remaining as safety net and investment money.
, take advantage of these historic low interest rates. I'd be willing to bet you will never see them this low again in your lifetime. You will look like a genius in 20 years when everyone is paying 10%+ on their new mortgages.
Also remember starting out, virtually all of your house payment will be tax deductible so it's really like getting 15% cash back every year on your house payments.
If you only make 5% return on the $36,000 you have left you will have $59,000 in 10 years and your 200K house should have appreciated at 2% a year conservatively and then be worth about $240,000 and you will have about $65,000 of equity in it.
Have you seen the rates lately? No longer historically low, they've gone up some. Still better than 08' and previous though. Lowest I've ever seen was 3.8 on a 30 / at least a 720 FICO.
Paying down low interest student loans and mortgages is the last thing i would do with the money. I am very much the anti Dave Ramsey in this economic environment. Let that be your only debt and have at least a 12 month padding of cash and put it to work for you. If you can't beat the interest rate of the loans with returns on your investments you aren't trying.
Agreed - that's what I told him NOT to do. I said keep the money, only put down minimal down payment. I advised that if paying off the debt faster was important, he could do it on his own terms as he makes more money or feels comfortable. Not at the expense of his savings.
a 30/3.8 is fine.
That's ridiculously low for a 30, that was a couple years back though.
I did a 30/3.5 for my daughter in 2013 in a neighborhood that is appreciating at 6% a year. FHA today is 30 / 4.1
Still not bad but the window is closing rapidly.
Well, you're going to violate my first rule. Oh well.
, I did a half mil this last fall on commercial property at 30 /4.5 fixed with 20% down. That one I'm knocking down principal an additional 5K a month till I get to 50% equity just for economic cycle padding, plus keeping my banks butt cheeks loose in case I find another good deal.
Okay, thanks for the advice guys - some great stuff to know.
Here's the situation though - when I applied with the mortgage broker, I mentioned I wanted to put 50k down - can I change my mind at any time, or did this figure influence
the pre-approval that I got?
Also, when she ran my credit, it was 737 - to get the best rates I needed 740. I paid off a few tiny balances on my credit cards so the score should go up next time it updates - I haven't actually gotten
any rates so that's what I'm waiting for. I think in a week I will also apply with another mortgage broker - because why not?
There's no way I can get a place for 110k in the bay area, a wooden shack in someone's backyard would cost more
I don't know the market there. Are there any areas that are still near inner city rough but almost guaranteed to get gentrified in the next ten years as people like you move back to town and bring the neighborhoods back? almost every city has those areas. If you are willing to take a risk in an area like that there are big rewards to be made if you ride out the first and second wave. Sounds like you are single and could take the chance.There's no way I can get a place for 110k in the bay area, a wooden shack in someone's backyard would cost more
Honestly, my plan was for the next 3-5 years, 10 seems a little long - I'm not even sure I wanna stay in the bay that long. That being said, as long as the house isn't too old, I don't care too much about the neighborhood.
My realtor is not coming back 2 weeks from now, that's when I'll start concentrating on what areas I can afford.
I think that's exactly what is happening in Oakland.
If your window is really 3-5 years you just need to rent. You will never recover your closing costs in that time frame and you would be making the mistake of your lifetime if you put all your savings into a house you plan to try to move from in 5 years.
I was counting on the bubble to keep steady for at least a few years, tech companies are still hiring like crazy around here. I could always rent it instead of selling if I see that
I can't recover the costs though, no? then sell once I have enough equity in it to turn a little profit.
Have to agree with this.
Move to Texas. 150K will get you a pretty nice middle class two-story house here in San Antonio in a decent area of town whereas that much will get you in California.
Just put in my offer! should hear back by tomorrow.
She was asking for 225000, I put in my offer at 217000, as long as she doesn't counter for more than 220000 I'm okay with it.
Not too thrilled with the HOA, but beggers can't be choosers - just gotta make sure I read the 200 pages carefully....
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