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Old timers and home owners I need your help

Discussion in 'The Lounge' started by fishintiger, Sep 27, 2004.

  1. I am looking to buy my first house. Well I should say my g/f and I are looking into it. I have a couple questions. Is there any benefit to getting a 15 year mortgage over a 30 year mortgage other than the obvious of having it paid off sooner? What should I look at with buying a pre-owned house? Any certain questions that I should ask the realtor while we are going through the house? I'll take any other information you guys can give me. Thanks a ton.


    fishintiger
     
  2. crankus_maximus

    crankus_maximus Crankus Baitus Maximus

    How old is the roof? How many layers in the roof? Was the furnace/ac replaced? When? Neighborhood fees? Ask how much the utilities are each month? IE - does it take a lot of electric or gas. What school system are you in, etc.

    Look for cracks/leaks in the basement and in the attic. Smell the water (sounds wierd, but nothing worse than bad water). What is the electrical system like? How much works needs to be done?

    Get the home warranty, its worth it. A 3o year mortgage has a lower payment, generally. However, you can always do what we do and divide a payment by 12 and add that avery month. Paying like that will shrink a 30 year mortgage to 23 years. Not bad. If you have, say 10k saved for a down payment you should put down half and keep the other half for home repairs, appliance, etc.

    Its a scary step, but take your time and DO YOUR HOMEWORK! Ask questions, write estimates down. When you find the right house you both will know it. Don't rush. Good luck!
     

  3. A 15 year mortgage has a lower interest rate also.
     
  4. If you do buy one and need some painting done P/M...........Rich
     
  5. First and most important get a home inspection. To many times ive had 1st time homebuyers not getting an inspection and wishing they did after the fact.

    As far as the mortgage it depends on your cash flow. 15 year surely has a better rate than a 30 year but the payment is alot higher. There are several things that you can do on a 30 year mortgage to reduce the term. 1st, by making by weekly payments you can take 7 years off your mortgage. Most lenders will set this up for you, if they wont talk to your mortgage broker and they should have some companys they work with to set this up. Also by putting a little extra in your payments will help reduce your term of that 30 year mortgage.

    I would highly recomend getting yourself pre-approved. This will help you in the quest for buying your first home. It will also help the realtor in writing your purchase contract, and getting sellers to accept it. When you send a pre-approval letter with your offer you would more than likely get a counter or acceptance that someone who hasnt been pre approved.


    Good Luck!

    Jason
     
  6. Reel Lady

    Reel Lady Dreams DO come true!

    I will tell you what my biggest concern is right off the bat. Let me preface by saying that I don't want to sound like a party pooper, and I dont want to taint your excitement about buying your first home. BUT...you did say that you and your "Girlfriend" (not your wife) were looking to purchase a home. Have you sat down and really thought about the possible problems with co-mingling your money if by any chance things should turn sour in the future between the two of you? I know that this is an ugly thing to think about, and is much easier to just blow it off, BUT, a little preplanning could save both you and your girlfriend alot of headaches later on, that is, IF things don't work out. Keeping in mind that the divorce rate (unfortunately I might add) is 50%, you seriously need to give this whole situation alot of thought before you have any regrets. For instance, what will happen if you two break up, and you are left in this house. Can you make these payments alone? Can she make these payments alone? Whose name will the house be in? How is your credit? How is her credit? Getting a lawyer involved may be the way to go here. Perhaps you could both sign a security agreement? Promisory Notes to eachother? There are many options. These agreements would be protection for BOTH of you, if one should decide to leave the relationship.
    I really am a very optimistic person, but, I am also a realist. Don't do anything in a hasty manner, as it will probably backfire eventually. And, don't ever think that people will always be fair when it comes to money matters, because unfortunately, I've seen too many people be manipulated by money which causes them to do immoral, unethical, and just plain bad things to people that they supposedly loved.
    Be smart about this decision, because you are talking about a long term financial commitment.
    Good luck to you :)
    Marcia
     
  7. Thanks for all the ideas guys. I thought all houses had to have an inspection before the sale could go through? Jason you are one of the people I was hoping would reply. I will probably be sending you an e-mail later. I am going tonight to be "pre-approved". Does it hurt to talk to a couple mortgage brokers or find one and stick with them? Thanks again. Anyone else got anything to add?

    Thanks Reel Lady for your thoughts. We have thought about all that. We have lived together for a little over 2 years now and she can put up with my crap so we should be fine. I have thought about all this stuff. We have out grown the apartment life now that we have a dog and taking it out is too much work. I like to beable to kick it out the door and let it back in a couple hours later. I think there might be a bigger commitment coming soon but I can't say that for a 100% but I think I have convinced myself that she is the one. Hopefully that will come shortly after the house.
     
  8. Reel Lady

    Reel Lady Dreams DO come true!

    The sale of a home should ALWAYS be contigent on a house inspection. So basically, what that means is that if anything shows up during the inspection that makes you feel uncomfortable, you can legally just walk away from the purchase agreement, and get your deposit back, OR you can use the results of the inspection to negotiate a lower price. I mean, if you were told that you would need to replace the entire roof within a couple of years, as well as put in a new driveway, you are looking at a nice chunk of money! 10,000.00 - 20,000.00! This should definitely come into play when discussing the final $ of the house.
    Also, does this house have sewer or septic? Are the schools in financial trouble? What are the neighbors like? Would you want to raise children in this neighborhood?
     
  9. I have to say Marcia you have all the answers or well maybe questions I need. The neighborhood we are looking at is the neighborhood that I grew up in. It isn't the richest part but there are far worse areas. The school district has gone to split sessions because of being over crowded. I don't see how. I have only been out of school for 4 years and it was just fine when I was there. I believe that the neighborhood is all sewer not septic. The only thing is some of the area requires flood insurance because the area flooded about 10 years ago because a levy broke on one the creeks that is in the area. How much does flood insurance cost? Thanks a bunch guys.
     
  10. shuvlhed1

    shuvlhed1 Banned

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    if anyone was going to bring up the point reel lady made. I can't think of a better way of trying to figure out if some one is "the one" than by making a 150 thousand dollar purchase with them :p

    Some one mentioned a home inspection on here. Personally, I rank that scam up there with some of the all time greats in this country, such as the tornado fuel saver, the Carlton Sheets no money down real estate course, and Democrats :D . Your bank will probably want it done, but it means ABSOLUTELY NOTHING. Just consider it a 3 or 4 hundred dollar mugging.

    By the way, not trying to be a jerk or anything, but if taking your dog out is too much work for you, then the last thing you need is a house.
     
  11. Reel Lady

    Reel Lady Dreams DO come true!

     
  12. Exactly! :D The dog chores won't change at all. Too many people think that they can just let the dog run for a while and no trouble will come from it. Unfortunately, many dogs don't make it home, especially if your in farm country.
     
  13. Listen to the ReelLady.

    Living together does not equal being married.
    You think you're convinced she's the one, what does she think about you?
    If you think you might have a commitment coming, wait for it.
    If you think walking the dog is too much work just wait till you are mowing the grass, landscaping, cleaning the gutters, shovelling the snow, doing your own maintenance/home repairs...

    been there, waited, glad I did.
     
  14. misfit

    misfit MOD SQUAD

    not much i can add.maybe check for bad flooring,fireplace operation)if it has one)sump pump operation,windows,doors,plumbing,including fixtures,and a few other things.
    reel lady has some sound advise on co-ownership.it's a different game when you're married.personally,it doesn't matter who pays what percentage of what,as long as you both agree on the financial aspects,and can live with that decision down the road.
    for once i agree with something shuvlhead said :eek: ;)
    most of those home inspection outfits are just a waste of money.i know there are some who are reputable and helpful,but i've seen some in action,and wasn't too impressed.if the bank insists,i'd let them or the seller pay.for the most part,anyone who is a little knowledgable about construction and/or knows what to look for can clue you in on the "important" stuff.if you're looking at pre-owned,most of the major things to check have been mentioned.you do want a homeownrs warranty.
    if you need any more advise,etc from his oldtimer,just give a yell.i'll be glad to help in any way i can.

    ps to shuvlhead and mike.................................just a thought.maybe he wants a fenced yard,which means he could let the dog out and have more time to devote to more important matters concerning the house,without worrying about the dog forgetting it's way home.
    just a silly thought,but maybe that's what he's referring to ;)
     
  15. Home inspections are not a scam. Not if you get a good inspector that is. They are an easy way to transfer a certain amount of liability for the condition of the house, and they can provide you with ammunition to lower the price. Depending on the age of the house make sure the inspector looks for asbestos and lead-based paint.

    Can't agree more about finding out about a legally binding way to deal with financial implications of 2 unmarried folks buying a house. Remember this, 50% of all marriages break up these days. Almost every one of those 50% that broke up felt like they were rock solid when they got married, just like you do. When they do break up the guy gets the short end 90% of the time.

    Get 2 people to help you with this:

    A realtor.
    A lawyer.

    Spend the money up front to protect yourself on the back end. I would never enter into a 15 or 30 year contract without a lawyer (who I paid) looking at it first.

    Look into the future the best you can. There is a magic number of years you need to live in a house before it becomes an investment. Real estate will almost never lose money, BUT that money may be working better for you somewhere else if you are going to be moving soon.

    Look into some of these costs that a lot of people do not factor into their budget post closing:

    Insurance
    Furnishings
    Property taxes (it is stunning how many people don't really look into this)
    Utility bills (ask to see bills during the coldest and warmest months of the year to get an idea of what yours will be)

    Other things not money related:

    Neighborhood crime rates
    Neighborhood rules (its amazing what some neighborhoods can do to regulate your use of your property)
    Police and fire response times to the area
    Drive through the area during rush hour to get an idea of traffic
     
  16. Good point Rick! I didn't think of that. I've yet to find a fence that'll keep my dogs in though. :D
     
  17. misfit

    misfit MOD SQUAD

    LOL mike.i've had a couple dogs like that too :eek:
    put the fence up thinking old barney could run the yard freely.never saw him jump that high before :rolleyes: :D
    back on the chain :rolleyes:
     
  18. mrfishohio

    mrfishohio Recovering Fishaholic

    Buying a house is a good thing.....
    What scares me is this...
    You've been together 2 years & are about to enter into a 15-30 year mortgage. I lived with a girl 2 1/2 years & split up. :rolleyes:
    It's like Reel Lady is saying. Since you're not married, maybe you want to put the house and mortgage in your name. Then if everything works out, when you marry, she automatically owns 50% in the state of Ohio :eek:
    Have an agreement that her contribution is treated the same as rent, similar to how they word land contracts. If she's contributing a portion of the DP, then you have to decide how to handle it. Use Murphy's law........ :confused:
     
  19. mrfishohio

    mrfishohio Recovering Fishaholic

    On another note, once you purchase the house, pay off the mortgage. They stack up the interest so that you pay mostly interest in the beginning. what happens in reality is for people who move every 5-6 years, they pay about 90% interest !! The only way you get the real rate quoted, is to pay off the loan in the full term. Best thing is to take your 10% you're supposed to be saving and add it to your monthly note. The interest you save will outstrip any interest or investments (which will avg. 7 % ?) Anyway, I heard that at a money managing workshop a few months ago, wish I had been to it when I was 25. :)
    When i bought our home in 1978 the rate was 8 1/4 %, the P&I was 198 or $200, anyway, after 1 year, there was only about $35 removed from the principal, same on the 2nd year, maybe a little more, but not significant, in fact, if you multiply you payment times the number of payments, you might be paying about 3 times over. I called the mortgage company to see if they had made a mistake, they said no, I asked, only $35 off all year in over $2,400 in payments? They said yes, so obviously if I had paid just an additional $35 that would remove one whole year of payments !! By adding $35 a month would have reduced the mortgage several years, that's just from the 1st year. So take my advice, pay something extra on every payment, even if it's only $25, it will save you so much you simply won't believe it.
     
  20. shuvlhed1

    shuvlhed1 Banned

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    I knew I could find something to say that you could agree with.

    And I did consider the fence thing, but knowing what I know if someone doesn't want the hassel of taking a dog out a few times a day in an apartment where he has no responsibility than chances are they won't want the hassel of cutting the grass, painting, trimming, keeping the yard clean, etc. I just don't want him looking through rose colored glasses that homeownership will cure some of his ills.