Home Forums Hunting & Shooting Hunter's Campfire Any house buying advice for a whippersnapper?

I had someone tell me to get a 30 year mortgage on my first home.

the problem is you're either going to pay PMI or get an 80/15 loan where the 15 is at like 7%.

I never made any progress paying it off until I refinanced and got a 15 year loan. Now every month I can see the principle go down and I'm actually on path to pay it off in just under 10 years.

Yes, it was a hit to my checkbook, but it eases over time, especially if you are young and moving up the ladder at work with yearly pay increases or promotions.

lots of good info so far...add in this> watch for/read any covenants that mite be in the mix and doing a sex/crime search by zip code may be worth looking at.

In the USA home mortgages will not be deductible for much longer.
Some thing is going to give on all that $$$ Obama is spending.

Rule 1: Do not listen to people on the Campfire-----Joking..

FHA new loan will have mortgage insurance no matter how much you put as down payment, this will last the life of the loan. Go with a Conventional Loan to avoid the extra fees.

Home Inspection: I would say yes on an older home. New Home, not so much. New home usually comes with a one year warranty.

Country Home: Make sure to get the well tested, check for potability and (GPM) Gallons Per Minute.
Test the Septic system.

Used Home, you could purchase a home warranty the policy last for one year and can be extend year by year. This usually covers all major plumbing and electrical. (water heater, dishwasher, AC unit)

Ask around, friend and family about a Realtor.
Find yourself a Loan Officer, get your Prequalification Letter. You will need this when you make an offer on a home.

Wish you luck

In Canada we have this option for a tax deductible mortgage.


Smith Manoeuvre



Smith-Manoeuvre-Smith-Maneuver The Smith Manoeuvre is a technique that converts regular debt into tax-deductible debt. In the process, it affords the opportunity to pay off one's mortgage significantly faster.

The Smith Manoeuvre works basically as follows:
1.First find a readvanceable mortgage
2.Then sell your non-registered assets (like stocks held outside of an RRSP)
3.Use the proceeds as a down payment on your mortgage
4.Make your mortgage payments like normal
5.As you pay off principal, re-borrow that principal into a line of credit (LOC)
6.Invest this re-borrowed money at a higher rate of return than the interest you pay on the line of credit
7.Deduct your investment loan (LOC) interest and use the tax savings (refund) to pre-pay your mortgage
8.Repeat steps 3-7 until your mortgage is fully paid off.

Fraser Smith, for whom the Smith Manoeuvre is named, stated that the strategy can cut your mortgage payoff time in 1/2, while helping you invest more, sooner.

The Smith Manoeuvre is indeed a powerful strategy, but it's not for everyone. There are both investment risks and serious tax risks. Your returns could be insufficient, CRA could invalidate your application of the strategy, or you could wind up in a negative amortization scenario if your house value falls.

Lots of good advice - I would add to consider location over everything else. Whether you are staying a year or a decade, homes in desirable location will move.

Well put down at least 20% and spend half of what the bank or lender says you qualify for. There is more to owning a house than the mortgage payment. There is property taxes, insurance, maintenance, heating and cooling, electric. And you can add on internet phone, and cable or Sat tv. I would also advise that you have at least 6 months of savings to cover these bills after purchase. Think of it as an insurance policy in case you become unemployed for a time. A 15 year note is what I would go for, a good accountant will advise you on that. My Property taxes when up 21% over last year, the assessment is the same. That is another thing you need to really look at were you are thinking of buying, how stable is the taxation, you want to look at what they taxed over the last 10 of 15 years to get a handle on what taxes might look like in another 10 or 15 years. Its getting to the point where I am that is almost unaffordable.

Make sure you check the tires, condition and pressure!

Wait and get what you want! You are in a better position now, (no house to sell before you buy).
You don't want to keep writing that check every month for something you're not satisfied with.

lol when the bank starts "looking out for ya" then LOOK OUT lol

the banks suggest 15 year loans so they can get their money back faster and not be stuck with a low interest rate for a long period of time. but they tell you it's good because you'll pay it off faster and have security.

same banks tell you to pull your equity out for everything more complicated than a pedicure. why ya suppose that is? they want your money to re-lend.

banks aren't going to look out for your best interests. they have to make money to stay in business. so when they push something, they stand to gain from it, not you.

it's a great idea to work with a financial planner on this stuff. your accountant might be able to save you in one category on taxes, but he/she is likely clueless when it comes to other avenues of finance, insurance, and investments- which are all part of the whole. and you need to make sure your whole picture is going the same direction and not overlapping or leaving you gaps you don't know about until a claim, death, disability, bankruptcy, etc happens.

it's nice to pay the house off but if you throw every extra cent into the mortgage and then get hurt or lose your job, good luck getting your money out of "bank jail" when you tell them you want YOUR equity but can't show proof that you can pay them back.

I knew we were doing it wrong, all our properties save one, are free and clear. : (


my advice on buying a home, don't.


what a PITA, when it's yours, you'll feel free to do all these bullchit projects that you and she (if there's a she) want, plus all the stuff that has to be done.


goodbye life


if I had it to do over, I'd quit my job and apply for public housing, if a guy can score a little crack, he'll have no troubles gettin laid in the neighborhood.


jk, luck to you on whatever you decide.

hah! not a damn thing wrong with being debt free, man. and congrats.

different person, different age, different game plan.

* Regardless of the loan term (15 vs. 30 year), make 50% of the payment every 2 weeks (and be sure the contract allows you to do this!). Every 6th month, you'll end up making a 3rd payment, though you'll never notice it in your budgeting. I believe this shaves up to 8 years off a 30 year loan.

* You should never buy the most expensive house in a neighborhood. Nor should you create it. In other words, be mindful about rehabs & upgrades. You'll have trouble selling the Taj Mahal if it's surrounded by trailers.

* Roofs last 30 years (if you're lucky). Water heaters, 4 to 10, depending. HVAC maybe 12-15. Appliances? - who knows? The point being, you'd better be regularly putting $ aside to deal with these eventualities. And these are the things that you know will be needing repair - what about unexpected stuff? If you max-out your borrowing just to purchase the home, you'll have a [female dog] of a time trying to maintain it.

* Per the point above, take your max borrowing #, & back out some $ for these expenses. Then back out some more for insurance. Then back out some more for taxes. Then back out some more for furniture. Once you have the final #, use that as your ceiling when house shopping. NEVER tell the Realtor how much you were approved-for by the lender: you have no business spending all of that on a house.

* Get a home inspection. Get a home inspection. And be sure to get a home inspection.

* Leave your heart behind when shopping. You may really, really like a certain house, but be prepared to walk away from it. The seller may not budge, or the home inspection may red-flag the place, or the title may have defects, or dozens of other things may go wrong. There are lots of houses out there, & they keep building more. You're looking for the best fit for you.

Good Luck!

FC

When we bought our first home I had a very simple test that the home had to pass:

If either of us started waxing on about "we could do this" or "we could do that" I ran like a striped assed ape away from the deal.
Unless you want to make a home your life buy something you're comfortable and satisfied living in, particularly if your planned stay is fairly short, say less than the life of the loan.
I can't think of a more sure way to get upside down on a house than sinking in a bunch of money in improvements.

We shopped and found a house with a built-in 33 position oak gun cabinet, 1 acre fenced back yard, pond, 980 sq ft garage, pheasant and dawg themed new finished (dry) basement, under-priced FSBO that appraised somewhere around 30% greater than the purchase price - in a strong market.

#1 Rule - Do not get in a hurry, If you are looking at a house in town, don't worry, they make more.

NO SUCH THING AS A STARTER HOME!!!! Buy a house you want to live in, not one you don't want to live in in 5 years.

MM

Find a house that's vacant due to foreclosure and squat in it.

You'll probably get run off eventually. When that happens just move into another one.

There's plenty out there.

http://www.argusleader.com/article/...ies-frustrate-Sioux-Falls?nclick_check=1

Sioux Falls is struggling to shed the housing crisis that was at the core of the Great Recession, and city leaders are taking steps to limit any damage to neighborhoods that might result from the aftermath.

Home foreclosures in Sioux Falls jumped almost 20 percent last year compared with the previous year. The 251 foreclosures last year tied the number posted in 2008. In the four years since the financial crisis that was triggered by bad housing loans began, only 2010 saw more foreclosures, at 291.

Meanwhile, the number of vacant buildings registered with the city also was up sharply. Last year, 205 buildings were registered as vacant, up from 138 in 2011 and 89 in 2010, according to city records. Many of the vacated properties were the result of home foreclosures.

As a side statistic, many homes now in foreclosure or listed as vacant are owned by government agencies, with some stuck in a sort of limbo status as far as being placed back on the market. Some are in foreclosure, while others seem to have lingered for months for no apparent reason.

Yea make sure you get the house you want not one that you plan to resale and are stuck in for awhile.

Whippersnapper?

I thought you were older...or am I thinking of your Dad?

Just sayin' the truth! This is the way to get a *15* year mortgage with 30 year terms. You can always pay extra, but if you are in a tight spot, you don't "have to".

If you are looking to sell in 2 or 3 years, it's a bit different ballgame.

Only read your post, so this may have been said, but put it in a Trust.

Get a house with a garage. Mine has two and the basement is 65% unfinished.

Think MANCAVE and there's not such thing as too much storage space.