buying a house? tips and suggestions?

[NDGeist]

I'm considering buying a house. I have never done this before and I'm wondering if I could get some tips from you guys.

First off: how much $$ should i look to spend to keep myself on budget. My GF and I make ~65-80 a year combined. We would like to just buy once and be able to raise kids and whatnot in the aforementioned home. We both currently owe ~10K on our Jetta's (they match ) and we've both got small to nonexistant school loans. We live in iowa so the cost of living isnt very high too.

Also, say a house is 140K, what should i expect to pay on say a 25 year mortgage or even a 30 year motgage (sp)? i've heard between 1 and 2 %. but then, that would be a hell of a lot of money. (note: in this area, 140-170 will buy you a NICE house.)

What dyou guys think?
Thanks
Chip

 

[ieee]

I just bought a $132,000 house....
conventional loan, we got 8.5%..
bad credit we have ...
WE were FHA approved...but sellers hate dealing with FHA loans over conventional..
FHA loans are about 6% interest..

save up about $12 grand for a deposit..

 

[ShallowHal]

Get pre-approved with the lowest rate you can find and start shopping.
Picture your stuff in the house you're looking at.
If you find a house you like, visit the house at different times of the day to see who's around. If your nieghbors are up and coming musicians or mechanics, you may want to consider another place

Good Luck.

Geez, 140k in California will get you a NICE one bedroom fixer upper.:disgust:

 

[UofI]

One of the biggest things when cosidering purchasing a house is the location. Do not get in some crappy area. Not that I am sterotyping, but scope the it out.

 

[NDGeist]

IEEE can you tell me... about how much is a payment on a house such as that?

I understand if you would rather not divuldge that kind of info.
Thx
Chip

 

[Queasy]

First, unless you and your gf are seriously serious about each other. Don't buy the house together. One of my co-workers sold his house and furniture to buy a house with his fiance. Not long after moving in together, she dumped him and he ended up with NOTHING. Very sad.

Second, you should be able to afford at least a $150,000 house in Iowa on what you make. My wife and I have approximately the same income with much more debt than you and were able to buy a nice $140,000 house in Atlanta.

If you can get an FHA loan, go for it. The downpayment is much cheaper and the interest rates are lower right now. There will be some hassles but it is worth it IMHO.

CAREFULLY, read your Good Faith Agreement. When you go into closing, make sure that the interest rates and the downpayment match what was on your Good Faith Agreement. If not, raise holy hell and, if necessary, walk out of the closing until they correct it. This actually occured to one of my wife's real estate clients. The mortgage company tried to screw her over and she called them out on it.

Find a good reference for a home inspector. Do not accept the home inspector provided by the sub-division or the home seller. Get your own.

That's all I can think of off the top of my head. Good luck!

 

[TomC25]

Never take the owners "word" that something works fine or is not a problem.

Get pre-approved before contacting the agent who is selling the house.

Try to negotiate the seller paying the closing costs if they do not want to fix something, or just see if they will.

Location - as said above visit the place at different times to see the area activity.

Broadband?

I cannot offer any advice as to how much you should pay monthly as I do not know your living style. There are more things you have to buy for a house as opposed to living in an apartment like yard equipment for all seasons and laundry stuff. Electricity bill will be higher and you also get water and trash bills.

It is nice being able to paint anything or make noise in your house without disturbing neighbors on the other side of a wall or floor.

 

[lepper boy]

Wife and I are currently looking at 104 acreswith a 3bedroom 1 bath house on it.... nice..... they want 150,000 good price....

 

[vi edit]

Cool! Another Iowan. I work in CR, but live down in North Liberty.

CR looks to have a pretty decent real estate market. You can get quite a bit of bang for your buck up here vs. down by where I live near Coralville.

My first piece of advice is to work out a budget. This IS ESSENTIAL. Let's go low. You and the g/f make 65k a year. You'll net about 43k after taxes and whatnot.

So that breaks down to about 3500 a month. I don't know what your car loans are so figure that in. Figure an easy $250 a month for utilities, then add in car insurance, food, student loans, personal retirement, ect and budget that in.

Figure out what you have left over and then figure out how much YOU think you'll be able to afford.

For reference, my fiancee and I purchased a townhouse down here in NL for 121,000. After downpayment and the closing costs, we actually financed around 118,000 over 30 years @ 7.25%. Our monthly payments are around $922 a month, nearly $100 of that is in Mortgage insurance since we owe more than 80% on our house. That $100 is more or less just getting thrown away. I wish I could have avoided it, but there was no way I could swing a 20% down payment.

After you figure out what you monthly payments would be (see mortgage-calc), you then have to factor in taxes. They could range anywhere from $1200 a month to $4000 a month depending upon neighborhood and squarefootage of house. So you then have to factor in that you'll be needing to budget another $100 to $350 a month ON TOP OF the mortgage payment(they'll usually factor it into your payment for you for ease of payment).

After you budget out what you think you can afford, I'd go to the bank that you are looking to borrow from and get pre-approved for a loan. They'll more or less tell you the max amount they'll let you borrow. That can really show you what price range of houses you can be looking at.

After you get pre-approved, then start heading out and looking at open houses and what not. Don't let your g/f fall in love with the first house you see. There are a huge amount of houses for sale in this area right now. The best I can tell you is to look at as many houses as you can.

If you do as you say, and want to remain in this house for quite a while, you need to seriously think about if you'll have enough space 5, 10, 15 years down the road. DO NOT buy too small of a house if you plan to live in it a while. Also consider the schools district that you are in, and if you want future children going to said school.

I would also suggest looking into the planned neighborhoods up on the NE side of town off of Boyson Road. The developed houses up there are pretty decent sized, and are reasonably priced. You just have to tolerate the fact that your house is the same as the next 4 people down the road, with the exception of different colored siding.

Best of luck!

 

[NDGeist]

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Broadband?
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Thats my HIGHEST concern.

Laundry I have, furniture I have. I would need yard equipment and whatnot. But for the most part it seems to make sense, with say a 150K house, what should i expect for a monthly payment? $800, $1400???

Thanks
Chip

 

[Queasy]

A couple of other things:

If you want to move into an older home. Make sure you find all the problems before-hand. If there is any fixing up you want to do, make sure you consider that into the cost of the house.

If you are moving into a new home, make sure every problem with the house is listed before closing. The builder is then obligated to fix those problems.

If you can afford it, add extra to your monthly payment. The general rule is take your monthly payment, divide by 12, and add that amount to your monthly payment. This pays your house off ALOT quicker.

Check out financial sites like Quicken.com. They generally have home mortgage calculators that will give you an idea of what you can qualify for and what your monthly payments will be.

 

[NDGeist]

vi_edit - My GF actually lives in N. Liberty and makes the drive to work every day as well. Thats ironic.

Thanks for all the info, now to send this link to the aforementioned GF. We were thinking something on the NE side, like you said, or on the NW side, just off of edgewood.

Thanks everyone for the input.

-Chip

 

[vi edit]

NDGeist, my fiancee goes to school and works down in IC so NL is very convenient for both of us

Also, check out

Iowa Realty, Cedar Rapids

 

[Tominator]

Bruce Williams, Famed Radio Talk Show Host wrote a book in conjunction with a Lawyer Friend called House Smart...get it!

 

[TomC25]

<< But for the most part it seems to make sense, with say a 150K house, what should i expect for a monthly payment? $800, $1400??? >>



You would be closer to $1400 than $800 with that price house, with a low downpayment (3%) of course.

 

[d33pt]

did i read this correctly? 104 acres and 3br house for 150k?!?!?! wow that is amazing how cheap real estate is in other states.. here in cali, a 3br house with no land would be at least 250k in a decent neighborhood...

 

[vi edit]

Our house that we purchased down in NL is nearly identical to this house except ours has two of them tacked together for a $20,000 savings. It is perfect for the two of us, and will work out well with one child. Once we get two kids, the house will be a little too small for us.

The nice thing about a new construct is that you get all new applicances(minus washer and dryer), the opportunity to pick your carpet and paint if caught early enough in the construction, and last but not least, you don't have to pay taxes on it for anywhere from a year to two years.

 

[bunker]

<<

<<
Broadband?
>>



Thats my HIGHEST concern.

Laundry I have, furniture I have. I would need yard equipment and whatnot. But for the most part it seems to make sense, with say a 150K house, what should i expect for a monthly payment? $800, $1400???

Thanks
Chip >>


Number one, if broadband is your highest concern, you shouldn't be shopping for a house. Your highest concern should be you and your future family's living conditions.

Number two, a 150k house payment could be $300/ month or $3000/month. It depends on what length of loan you get, how much you put down, what's included in your house payment (for me it's taxes and insurance).

 

[docmanhattan]

My wife and I JUST moved into our first house (Feb. 2) and there were a couple things that really stood out amoungst the eleventy billion things we learned.

1) don't worry about offering too little. it's not really personal and the worst the seller can do is not accept your offer. In most cases, if it's relatively reasonable they'll counter. You know, haggle!

2) get an inspection on the place you decided upon and make it a contingency. that way you're protected unless if the seller failed to mention things like, say, a 10 foot hole in the master bathroom or something. i found our inspection to be really interesting because the guy was super imformative of course YMMV.

i'm not an expert this by any measure, but i learned a good deal in this process. you will to.

good luck!

 

[rh71]

You guys don't even want to hear the prices here on LongIsland, NY... $400k will get you a 3 bedroom with $8-11k/yr in taxes alone. And believe me, they don't exactly pay you that much more to compensate for cost of living... despite what you've heard... NYC perhaps, but not LI. Anyway, I would love to move to someplace like N.Carolina and pay $100k for the same thing and 3x the property.

Broadband is a definite concern (as you said already) and so is the school district!!!!! I'll unfortunately have to start looking in a year.

 

[Sluggo]

A quick rule of thumb on payment amount is with a reasonable down payment (5-10%), figure about $100 a month for every $10,000 you borrow to cover Principal, interest, property taxes and homeowners insurance.

Its not an exact formula, but gives you a quick idea.

100k = $1000 a month

120k =$1200 a month

150k = $1500 a month