Buying a home

[Brownslave688]

First: 19% going into retirement is awesome...but a little premature before you're in a house. Cut back the 401k to about 3-8%. It's ok to only put 10-15% into retirement for you right now.

Second: Get into a good house for your present needs. A starter home is perfect. 90%+ of women will want to pick out their own home, so buying a "family" home isn't super important for you.

Third: 20% down is going to be about $100 a month per 100K borrowed cheaper on insurance for the lender (in case you default). That money is thrown away.

Fourth: in 5 years, if/when you move up in home your equity will move with you and you'll only have to save that 20% once.

Why cut back on the retirement?


He really doesn't NEED a home and that money he puts away now will be worth way more when retirement comes

 

[Whitelexus]

I am at the point where I want to start looking at buying a house. I am making enough money (finally hit $25.00) and working enough hours because I am not laid off most Mondays anymore. I am a single guy, no kids, and sick of living the apartment life. Living in an apartment is cheap, but it has way too many drawbacks so it's time for me to step up and make the 15-30 year commitment.

Just looking for some advice on how to go about the process. I don't want to be paying on a mortgage when I'm retired so I am looking at a 15-20 year mortgage. Decent houses in my town are ranging from $180,000-$240,000 so with a rate of let's say 3.25% I can expect a payment of around $1,500 a month which should be doable now with some budgeting, even more so once I hit top rate.

If anyone knows of any advantages or has experience in doing a 15 year vs a 30 year mortgage I would love any advise at all!

Do the 15, if you can swing it. Your monthly payment will depend on a few variables. Get a prequalification letter from a lender and have this discussion with them. Some smaller lenders may have portfolio loans that’ll get you away from PMI but with a lower down payment. Interview a few buyers agents and hire a Realtor to help with the process. But that’s just my 2 cents. Good luck!

 

[IVE GOTTA PACKAGE 4U]

Why cut back on the retirement?


He really doesn't NEED a home and that money he puts away now will be worth way more when retirement comes

Or he could buy a smaller home and invest the difference until he retires...Maybe Bitcoin??

 

[Brownslave688]

Or he could buy a smaller home and invest the difference until he retires...Maybe Bitcoin??

If he's deadest on buying I'd get a small older 2 bedroom house.

 

[IVE GOTTA PACKAGE 4U]

If he's deadest on buying I'd get a small older 2 bedroom house.

Depends on how much work it needs. It's easy to get trapped in to a money pit.

 

[rickyb]

I am at the point where I want to start looking at buying a house. I am making enough money (finally hit $25.00) and working enough hours because I am not laid off most Mondays anymore. I am a single guy, no kids, and sick of living the apartment life. Living in an apartment is cheap, but it has way too many drawbacks so it's time for me to step up and make the 15-30 year commitment.

Just looking for some advice on how to go about the process. I don't want to be paying on a mortgage when I'm retired so I am looking at a 15-20 year mortgage. Decent houses in my town are ranging from $180,000-$240,000 so with a rate of let's say 3.25% I can expect a payment of around $1,500 a month which should be doable now with some budgeting, even more so once I hit top rate.

If anyone knows of any advantages or has experience in doing a 15 year vs a 30 year mortgage I would love any advise at all!

look up articles about housing bubbles. theres another one.

the next financial crisis should be a doozy too, so take that into consideration

 

[Whitelexus]

If he's deadest on buying I'd get a small older 2 bedroom house.

Beware of the 2 BR home...unless you scoop it up at the right price

 

[Brownslave688]

Beware of the 2 BR home...unless you scoop it up at the right price

Yes you'd have to get it cheap.



Homeownership is extremely overrated. Moreso in the op situation.



Now if he were looking for a duplex to live in one side and rent the other. Hell yeah go for it.

 

[burrheadd]

Yes you'd have to get it cheap.



Homeownership is extremely overrated. Moreso in the op situation.



Now if he were looking for a duplex to live in one side and rent the other. Hell yeah go for it.

You don’t want to live next door to your tenants

Unless it’s grandma or maybe aunt Judy

 

[IVE GOTTA PACKAGE 4U]

look up articles about housing bubbles. theres another one.

the next financial crisis should be a doozy too, so take that into consideration

In Canada?

 

[Old Man Jingles]

I am at the point where I want to start looking at buying a house. I am making enough money (finally hit $25.00) and working enough hours because I am not laid off most Mondays anymore. I am a single guy, no kids, and sick of living the apartment life. Living in an apartment is cheap, but it has way too many drawbacks so it's time for me to step up and make the 15-30 year commitment.

Just looking for some advice on how to go about the process. I don't want to be paying on a mortgage when I'm retired so I am looking at a 15-20 year mortgage. Decent houses in my town are ranging from $180,000-$240,000 so with a rate of let's say 3.25% I can expect a payment of around $1,500 a month which should be doable now with some budgeting, even more so once I hit top rate.

If anyone knows of any advantages or has experience in doing a 15 year vs a 30 year mortgage I would love any advise at all!

Qualifying is the hard part ... I wanted to do this and did not qualify.
You can however pay extra payments (make sure they are designated to the principle rather than an 'early payment'. The industry does not seem to like paying off loans early.

I paid off two houses early doing this (one at 16 years and another at 11 years).

The following will help you to qualify for a 15 or 10 year loan.

• Get those credit cards down to ZERO each month.
• No car payment will help too!
• Believe it or not, extra credit cards with zero balance helps in your FICO score. I have over 20 credit cards (all with zero balance) and my score was 837 out of 850.
  Any score of 800 or higher helps with qualifying for the lowest rate.

 

[Brownslave688]

You don’t want to live next door to your tenants

Unless it’s grandma or maybe aunt Judy

Ideal no but a lot better than buying a 3 bed 2 bath home and sacrificing retirement to turn around and sell it in 5 years because it's not what the wife wants.

 

[burrheadd]

Ideal no but a lot better than buying a 3 bed 2 bath home and sacrificing retirement to turn around and sell it in 5 years because it's not what the wife wants.

The right house you could make more when you sell than you’d make in a retirement fund

 

[Brownslave688]

The right house you could make more when you sell than you’d make in a retirement fund

People don't sell houses to fund retirement very often.


He's got a great long term plan going right now. I don't want him to screw that up because he thinks he needs a house right now.

 

[Rack em]

Qualifying is the hard part ... I wanted to do this and did not qualify.
You can however pay extra payments (make sure they are designated to the principle rather than an 'early payment'. The industry does not seem to like paying off loans early.

I paid off two houses early doing this (one at 16 years and another at 11 years).

The following will help you to qualify for a 15 or 10 year loan.

• Get those credit cards down to ZERO each month.
• No car payment will help too!
• Believe it or not, extra credit cards with zero balance helps in your FICO score. I have over 20 credit cards (all with zero balance) and my score was 837 out of 850.
  Any score of 800 or higher helps with qualifying for the lowest rate.

I only have 2 credit cards, one for some small automatic payments and another for just everyday purchases. But I pay those off weekly if I can. I got the truck paid off so I don't have a truck payment anymore. And the last time I checked my credit score, it was I think 792 or something like that. I hope that would be good enough to get approved for a loan since I only have the one income being single and all. It's a bonus if it can get me a lower interest rate!

 

[Old Man Jingles]

I only have 2 credit cards, one for some small automatic payments and another for just everyday purchases. But I pay those off weekly if I can. I got the truck paid off so I don't have a truck payment anymore. And the last time I checked my credit score, it was I think 792 or something like that. I hope that would be good enough to get approved for a loan since I only have the one income being single and all. It's a bonus if it can get me a lower interest rate!

Try taking on another credit card and use it for a month.
Pay it off and check and see what that does for your score.
It might pop you over 800 but no chance of pulling you down to 750.
The brackets for FICO score users is 800 - 850, 750 -799, 700 - 749, etc.

 

[oldngray]

Beware of the 2 BR home...unless you scoop it up at the right price

2 BR's are very hard to sell. Which is why you can pick one up relatively cheap. The problem is trying to get rid of it when you want something better.

 

[Old Man Jingles]

Why cut back on the retirement?


He really doesn't NEED a home and that money he puts away now will be worth way more when retirement comes

Speaking for myself ... I found that if I rewarded myself during employment, I felt more motivated and like I was being rewarded.
He said he was dissatisfied with apartment living.
Granted, he should not go out and buy a mansion because "buying" a house is not that great an investment for most. It is more of a life style choice.

 

[CoffeeStainedUniform]

I only have 2 credit cards, one for some small automatic payments and another for just everyday purchases. But I pay those off weekly if I can. I got the truck paid off so I don't have a truck payment anymore. And the last time I checked my credit score, it was I think 792 or something like that. I hope that would be good enough to get approved for a loan since I only have the one income being single and all. It's a bonus if it can get me a lower interest rate!

That credit score is excellent. You'll get approved for more than you should buy. Any other questions?

 

[Old Man Jingles]

2 BR's are very hard to sell. Which is why you can pick one up relatively cheap. The problem is trying to get rid of it when you want something better.

Good point.
Also, really big room are enjoyable but it eliminates many buyers.