Looking to buy a house

[Ascf33]

Originally Posted by TheLastStop123

so I'm 25 years old, have some money saved up and am tired of pissing away $775 in rent each month living in an apartment. I'm thinking I want to buy a townhome. My question is, what percentage do people usually put down as a down-payment? I was thinking it was at least like 10%, but I've spoken to a couple of friends, and some say you can go as low as 3%, or anywhere between 3.5-5% for someone that's a first time buyer doing just a townhome.

Looking at a couple of places, I've already determined that it would be cheaper each month if I bought a townhome. This seems like a no-brainer to me. Anyone have any tips/suggestions?

We did an HOA loan for our first house here and that was 3.5% Chances are you won't be living in that house more than 5 or so years so it really doesn't matter all that much (IMO). Our new house we're building right now, we put 30% down.

[Ascf33]

Originally Posted by YouNeverKnow25

I'll start by saying if you want to do it, go for it. There's no magic number.

I'd also say, look harder at the costs. I would be somewhat surprised if it's cheaper to own versus rent on a per-month basis for comparable properties.

Make sure you factor in taxes and insurance.

If he's looking in Raleigh or the surrounding areas, it is definitely comparable.

[TheLastStop123]

Originally Posted by YouNeverKnow25

I'll start by saying if you want to do it, go for it. There's no magic number.

I'd also say, look harder at the costs. I would be somewhat surprised if it's cheaper to own versus rent on a per-month basis for comparable properties.

Make sure you factor in taxes and insurance.

Originally Posted by Ascf33

If he's looking in Raleigh or the surrounding areas, it is definitely comparable.

Thanks for the input! I definitely do need to crunch the numbers a little more, but I am indeed looking in the Raleigh area. Just gotta see if I can swing it. I'm definitely a lot closer to being able to afford one than I ever thought I'd be.

[YouNeverKnow25]

if you're gonna do an FHA loan, factor in the upfront mortgage insurance premium (1.75% of loan) and the annual PMI premium (0.85% of the loan, if you're bringing less than 5% to the table).

a lot of times (most, actually) the HUD loans would use the same numbers

[TheLastStop123]

Originally Posted by YouNeverKnow25

if you're gonna do an FHA loan, factor in the upfront mortgage insurance premium (1.75% of loan) and the annual PMI premium (0.85% of the loan, if you're bringing less than 5% to the table).

a lot of times (most, actually) the HUD loans would use the same numbers

Is doing a loan even necessary? What if I have the down payment money up front? I apologize for the super basic questions, but I honestly don't know too much about this stuff haha.

[TimHonks]

Originally Posted by TheLastStop123

so I'm 25 years old, have some money saved up and am tired of pissing away $775 in rent each month living in an apartment. I'm thinking I want to buy a townhome. My question is, what percentage do people usually put down as a down-payment? I was thinking it was at least like 10%, but I've spoken to a couple of friends, and some say you can go as low as 3%, or anywhere between 3.5-5% for someone that's a first time buyer doing just a townhome.

Looking at a couple of places, I've already determined that it would be cheaper each month if I bought a townhome. This seems like a no-brainer to me. Anyone have any tips/suggestions?

Wow, I really need to move.

[YouNeverKnow25]

Originally Posted by TheLastStop123

Is doing a loan even necessary? What if I have the down payment money up front? I apologize for the super basic questions, but I honestly don't know too much about this stuff haha.

if you don't have all the money--as in, every cent of the agreed upon price plus settlement costs-- then yes, you will have to get a loan.

[GSUdawg521]

Guess I just missed this thread as it was started a few months before we started the home buying process. We just bought our first house at the beginning of May. It wasn't the most fun process, but feel like we learned a ton and did really well. Between both of our parents and my brother being very experienced and knowledgeable on the process and a pretty good agent, we're happy with how things went.

Obviously down payment % is case by case person. I would not say 'you have to have 20% or don't buy'. But if you can find a way to come up with it without hurting yourself, it's clearly the way to go. My brother's advice for if you think you were going to be under 20% would be to find a loan for the difference that might be a higher interest rate, but it ends up being better than PMI which sometimes can cause you trouble down the road when you go to have your loan company remove it. It wouldn't have worked out for us but again, everyone's situations are different.

My best advice is to not get too attached to any one home and be ready to always be looking out for the next option, and don't be afraid to play some freakin hardball! That was the most fun out of it. Our house appraised significantly less than the agreed upon price so then we said that's the amount we were going to pay. Seller and her agent didn't agree and said they'd put it back on the market. We said okay, good luck. Then they agreed to meet us in the middle or something. We said no dice. Then she caved.

Then there was an issue of getting something repaired for like $3,000 or something that we weren't going to give in on. The selling agent told us the seller thought she'd already done enough and with how much interest there was on the house, she, again, was ready to relist. At this point, we were like 90% sure that this seller had already started the process buying her new house and even had a moving date. We felt our agent was on our side for sure, but just to drive the point home, I looked up several other houses we liked and told her to tell the seller's agent to suck it and here are some other houses we'd like to go look at this weekend. That kind of thing can definitely light a fire under a selling agent who, along with the listing agent, just want to get the sale done and get their cut. We got a call a day or two later that the repair was going to be made. My fiancee hated the emotional rollercoaster, which it definitely was, but I was like c'mon! It's like we just won a $3k hand of poker!

[smokew11]

Originally Posted by TheLastStop123

Is doing a loan even necessary? What if I have the down payment money up front? I apologize for the super basic questions, but I honestly don't know too much about this stuff haha.

yes, its necessary- you're not getting a loan for the 20% you have, you're getting a loan for the 80% you need

[TheLastStop123]

Originally Posted by YouNeverKnow25

if you don't have all the money--as in, every cent of the agreed upon price plus settlement costs-- then yes, you will have to get a loan.

Now this makes sense. I'm hoping that I would have all of that money up front.

Originally Posted by GSUdawg521

Guess I just missed this thread as it was started a few months before we started the home buying process. We just bought our first house at the beginning of May. It wasn't the most fun process, but feel like we learned a ton and did really well. Between both of our parents and my brother being very experienced and knowledgeable on the process and a pretty good agent, we're happy with how things went.

Obviously down payment % is case by case person. I would not say 'you have to have 20% or don't buy'. But if you can find a way to come up with it without hurting yourself, it's clearly the way to go. My brother's advice for if you think you were going to be under 20% would be to find a loan for the difference that might be a higher interest rate, but it ends up being better than PMI which sometimes can cause you trouble down the road when you go to have your loan company remove it. It wouldn't have worked out for us but again, everyone's situations are different.

My best advice is to not get too attached to any one home and be ready to always be looking out for the next option, and don't be afraid to play some freakin hardball! That was the most fun out of it. Our house appraised significantly less than the agreed upon price so then we said that's the amount we were going to pay. Seller and her agent didn't agree and said they'd put it back on the market. We said okay, good luck. Then they agreed to meet us in the middle or something. We said no dice. Then she caved.

Then there was an issue of getting something repaired for like $3,000 or something that we weren't going to give in on. The selling agent told us the seller thought she'd already done enough and with how much interest there was on the house, she, again, was ready to relist. At this point, we were like 90% sure that this seller had already started the process buying her new house and even had a moving date. We felt our agent was on our side for sure, but just to drive the point home, I looked up several other houses we liked and told her to tell the seller's agent to suck it and here are some other houses we'd like to go look at this weekend. That kind of thing can definitely light a fire under a selling agent who, along with the listing agent, just want to get the sale done and get their cut. We got a call a day or two later that the repair was going to be made. My fiancee hated the emotional rollercoaster, which it definitely was, but I was like c'mon! It's like we just won a $3k hand of poker!

That is some crazy stuff! My mom is a real estate appraiser and has good background in this kind of thing, so I'm feeling as though I'll be well-equipped.

Originally Posted by smokew11

yes, its necessary- you're not getting a loan for the 20% you have, you're getting a loan for the 80% you need

This makes sense. A friend of mine recently got a townhome and put down 3% cause it allowed her to get the lowest interest rate, and she did a conventional 30 year fixed mortgage.

[GSUdawg521]

Originally Posted by TheLastStop123

This makes sense. A friend of mine recently got a townhome and put down 3% cause it allowed her to get the lowest interest rate, and she did a conventional 30 year fixed mortgage.

you sure about that? That's generally the opposite of how it works. The more you put down, the lower your interest rate will be.

[smokew11]

Originally Posted by TheLastStop123

This makes sense. A friend of mine recently got a townhome and put down 3% cause it allowed her to get the lowest interest rate, and she did a conventional 30 year fixed mortgage.

Originally Posted by GSUdawg521

you sure about that? That's generally the opposite of how it works. The more you put down, the lower your interest rate will be.

yeah you might want to double check that....lower interest rates are awarded to people who's loans have less risk...things like a high credit score and a bigger down payment are taken into account

only putting 3% down increases the risk for the bank

[Nick@Night]

Originally Posted by TheLastStop123

This makes sense. A friend of mine recently got a townhome and put down 3% cause it allowed her to get the lowest interest rate, and she did a conventional 30 year fixed mortgage.

Sure it wasn't FHA? What you described doesn't sound conventional. So little down with lowest IR is not what you typically get with a conventional. 5% minimum down payment conventional, usually .25%-.50% higher IR than FHA.

[YouNeverKnow25]

Originally Posted by TheLastStop123

Now this makes sense. I'm hoping that I would have all of that money up front.

All what money? If you're not putting 100% down, you're not putting down "all that money up front"

[YouNeverKnow25]

And you can't get a conventional loan at 3%. Just can't happen.

I've seen really low rates with fha loans though

[DMBstandUP1984]

We are in the process of looking for/buying a house

using the VA loan so it doesn't require any money down. BUT the VA does an inspection after the initial home inspection, per the terms of the VA loan anything they deem needs to be fixed, replaced, or added needs to be done by the seller prior to the VA issuing the loan.

So far we have had two sellers back out because they didn't want to comply with the VA Loan (after they already knew what the VA loan was all about). The stuff the VA wanted fix was not exactly crazy ie. add a rail, fix a piece of wood under the outside steps, but it is just getting frustrating.

[GSUdawg521]

Originally Posted by DMBstandUP1984

We are in the process of looking for/buying a house

using the VA loan so it doesn't require any money down. BUT the VA does an inspection after the initial home inspection, per the terms of the VA loan anything they deem needs to be fixed, replaced, or added needs to be done by the seller prior to the VA issuing the loan.

So far we have had two sellers back out because they didn't want to comply with the VA Loan (after they already knew what the VA loan was all about). The stuff the VA wanted fix was not exactly crazy ie. add a rail, fix a piece of wood under the outside steps, but it is just getting frustrating.

So there's no way of going around it and being like "I'm good, I can fix that myself"? If the seller doesn't comply, they have to back out?

[DMBstandUP1984]

Originally Posted by GSUdawg521

So there's no way of going around it and being like "I'm good, I can fix that myself"? If the seller doesn't comply, they have to back out?

they could add whatever the cost to fix it was to the sale price. But that is the only way around it.

[Nick@Night]

Originally Posted by DMBstandUP1984

We are in the process of looking for/buying a house

using the VA loan so it doesn't require any money down. BUT the VA does an inspection after the initial home inspection, per the terms of the VA loan anything they deem needs to be fixed, replaced, or added needs to be done by the seller prior to the VA issuing the loan.

So far we have had two sellers back out because they didn't want to comply with the VA Loan (after they already knew what the VA loan was all about). The stuff the VA wanted fix was not exactly crazy ie. add a rail, fix a piece of wood under the outside steps, but it is just getting frustrating.

They'll back out of a sure sale for stuff like that? Cripes. I agreed to replace a sliding patio door at my own cost to keep the sale pending. The things you mentioned are small potatoes.

[DMBstandUP1984]

[QUOTE=Nick@Night;16089383]

Originally Posted by DMBstandUP1984

We are in the process of looking for/buying a house

using the VA loan so it doesn't require any money down. BUT the VA does an inspection after the initial home inspection, per the terms of the VA loan anything they deem needs to be fixed, replaced, or added needs to be done by the seller prior to the VA issuing the loan.

So far we have had two sellers back out because they didn't want to comply with the VA Loan (after they already knew what the VA loan was all about). The stuff the VA wanted fix was not exactly crazy ie. add a rail, fix a piece of wood under the outside steps, but it is just getting frustrating.[/QUOTE]
They'll back out of a sure sale for stuff like that? Cripes. I agreed to replace a sliding patio door at my own cost to keep the sale pending. The things you mentioned are small potatoes.

yeah we spoke to a few people that recently sold their house and said there is always cost before the closing to fix small issues

for example there was a 7 foot piece of wood that had pest damage under the stairs (the house passed a pest inspection) would have cost the home owner $1,200, he told us to beat it

[TheLastStop123]

Originally Posted by GSUdawg521

you sure about that? That's generally the opposite of how it works. The more you put down, the lower your interest rate will be.

Originally Posted by smokew11

yeah you might want to double check that....lower interest rates are awarded to people who's loans have less risk...things like a high credit score and a bigger down payment are taken into account

only putting 3% down increases the risk for the bank

Originally Posted by Nick@Night

Sure it wasn't FHA? What you described doesn't sound conventional. So little down with lowest IR is not what you typically get with a conventional. 5% minimum down payment conventional, usually .25%-.50% higher IR than FHA.

I'll have to double check with her, maybe she was confused.

Originally Posted by YouNeverKnow25

All what money? If you're not putting 100% down, you're not putting down "all that money up front"

I just meant the initial $5-8k it's going to cost me for the downpayment, not the price of the whole house haha.

[DMBstandUP1984]

So we (me the buyer and the seller) signed the offer to purchase (in MA that is a binding contract) the day to sign the P&S my wife and I signed it, our lawyer sent it to the seller, the seller made some changes that we agreed on. After we sent it back the seller cuts off all contact, her listing agent e-mails us 3 hours later and tells us the seller decided she does not want to sell to buyers using the VA loan.

Our lawyer reaches back out to her and tells her that the offer to purchase is a binding contract, she can't back out, so we signed the P&S sent that, the deposit and our lawyer typed up a letter saying we will take legal action if she does not do her part that she already agreed upon.

Just some background, we offered to buy this house for 6k more than the asking price, it passed both inspections (normal and VA) and we were not asking the seller to fix/add/replace anything. She knew it was the VA loan and that really doesn't matter at this point because a loan is a loan. Last night the seller replies to our lawyer saying she "took the house off the market" he wrote back and said "it doesn't work that way"

and today we are basically sitting and waiting. This is probably the most aggravated I've been in awhile.

oh and we also found out that after she agreed and signed our offer to purchase, a cash buyer made a bid to her.

[Rebecca De Mornay]

Originally Posted by DMBstandUP1984

So we (me the buyer and the seller) signed the offer to purchase (in MA that is a binding contract) the day to sign the P&S my wife and I signed it, our lawyer sent it to the seller, the seller made some changes that we agreed on. After we sent it back the seller cuts off all contact, her listing agent e-mails us 3 hours later and tells us the seller decided she does not want to sell to buyers using the VA loan.

Our lawyer reaches back out to her and tells her that the offer to purchase is a binding contract, she can't back out, so we signed the P&S sent that, the deposit and our lawyer typed up a letter saying we will take legal action if she does not do her part that she already agreed upon.

Just some background, we offered to by this house for 6k more than the asking price, it passed both inspections (normal and VA) and we were not asking the seller to fix/add/replace anything. She knew it was the VA loan and that really doesn't matter at this point because a loan is a loan. Last night the seller replies to our lawyer saying she "took the house off the market" he wrote back and said "it doesn't work that way"

and today we are basically sitting and waiting. This is probably the most aggravated I've been in awhile.

oh and we also found out that after she agreed and signed our offer to purchase, a cash buyer made a bid to her.

just start moving your shit in.

[scrock25]

Jesus dude, that blows. Keep us posted.

[DMBstandUP1984]

Originally Posted by scrock25

Jesus dude, that blows. Keep us posted.

Originally Posted by Rebecca De Mornay

just start moving your shit in.

haha dude so frustrating.


Yeah hopefully we get some answers today. She is a lawyer and just representing herself but she is not a real estate attorney.

And we probably don't have the cash to take her to court on this since we are trying to buy a house, if this doesn't go through I'm just gonna hit her website and any website I can review her and tell everyone she hates Veterans

[scrock25]

Well that's not cool as it's probably not the case.

[DMBstandUP1984]

Originally Posted by scrock25

Well that's not cool as it's probably not the case.

I know. just frustrated

[scrock25]

Totally understood.

[YouNeverKnow25]

file a lis pendens. immediately.

[YouNeverKnow25]

why would there be two different documents? that makes no sense