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Discussion Starter #1
Ok, the time has come. Have a family and need to get off my lazy ass and get a house. I have a shit ton of bills, credit score is damn good, and unmarried. I dont want to spend over $70k so my choices are limited.

My dad is giving me $2500, GF mom is giving me $10k, and The bank I borrow from has a first time buyer program where they give you $5k and if you stay in that house for 5 years, you dont have to pay it back. so I have about $17.5 for a downpayment and costs.

My questions are:

  1. What expenses are their with buying a house? Example, closing costs and the such
  2. I have way to many bills and can they (bank) roll those into the mortage?
  3. What type of legalites are there with buying a house? Like, A lemon law, Time to close or lose etc.
  4. What type of taxing do i have to deal with and do I get any more back at the end of the year because I own a house?
I am sure I will come up with more questions but this is what i can think of now. thanks guys
 

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Don't wait till September. Do it ASAP! Interest rates will be going up the next time Greenspan opens his Pie Hole!
AND GET A FIXED RATE if your planning on staying more than five years.
Your closing fees will all be worked into the loan.
Out of pocket will include a property report that YOU will arrange for. Although the owner will do one himself, it's "piece of mind" having someone you pay giving you a report (termite, mold, dryrot, condition of roof, wheather or not it's on a flood plain are just a few things they check).
You may have to pay for appraisal but most loan companies pay for it to secure your bussiness.
 

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Not so happy making 19k a year anymore? Just kidding... I don't have any idea of the market in your area, thats such a localized thing. Typical conventional loans requier 5% down or so. Check into a FHA loan, based on your income you may qualify. Around here it is typical to have the seller buy you a one year home insurance policy to cover things like ac, water heater, furnance, etc going bad. Mine was like $450 for the year. You can sometimes bargin with the seller and see if they will cover some of the closing costs, even if it means adding it to the selling price, this will mean less cash out of your pocket. If your only looking on spending on 70k, you can probaly do it for 5k or so and use the rest of the cash to pay off your bills. When you build some equity in your place, you could then get a Home equity line of credit (heloc) to pay off higher interest rate bills.
 

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Discussion Starter #4
G-Force Junkie said:
Not so happy making 19k a year anymore? Just kidding... I don't have any idea of the market in your area, thats such a localized thing. Typical conventional loans requier 5% down or so. Check into a FHA loan, based on your income you may qualify. Around here it is typical to have the seller buy you a one year home insurance policy to cover things like ac, water heater, furnance, etc going bad. Mine was like $450 for the year. You can sometimes bargin with the seller and see if they will cover some of the closing costs, even if it means adding it to the selling price, this will mean less cash out of your pocket. If your only looking on spending on 70k, you can probaly do it for 5k or so and use the rest of the cash to pay off your bills. When you build some equity in your place, you could then get a Home equity line of credit (heloc) to pay off higher interest rate bills.
actualy i am at $23k now (and remember, i am only 22) :rolleyes: Thats why i was hoping to god i got that job. anyway. thanks so far guys
 

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1st get your credit report. Look for mistakes. fix your credit.
2nd Aim for getting your credit cards paid down to below half of the limit. Might have to shift some debt aroundThis improves your credit score.
3rd Calculate your debt to income ratio. Look up how to do this on the web. Lenders like to use this to determine how much you can borrow.
4th Lenders like to see that you have held the same job and employer for over 2 years.

If you dont look so good on paper or dont qualify for much.....You may want to get into the foreclosure market. I was watching realtytrack.com for a while. Buying a distressed house can be cheaper.

If all else fails find someone who owns a house outright and talk them into carrying the note. This means they are the bank and you make payments with interest to them.
 

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You DEFINELTY need to do it sooner than later as explained above - the RATES will go HIGHER SOON


some more...

If you do not put 20% down you will pay PMI (Private Mortgage Insurance) and it can be quite costly So make sure you take that money that you are receiving and use it for the house.

Dont forget about the property taxes you will have to pay yearly to your state, they will add some cost to your monthly payments.

Insurance on the house - you must pay 1 full year up front. This is a smaller expense, but will bite you if you dont have the cash ready.

be prepared - have yout tax forms from the past 2 years ready, the bank will want to see them.

good advice on the credit report, however - i would not worry about paying the CC down, unless you can pay them off this month. you have to allow the time for the report to get back to the credit industry to make any difference.

Use a mortgage broker (internet) to shop around for a loan - you do not have to get a local loan. Look into first time home owner programs for assistance. And with your income level, you may qualify for additional assistance as well.

READ all about mortgages with this link. Self prep is the key to making this go well.

http://www.bankrate.com/brm/rate/mtg_home.asp?link=5
 

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bubba said:
good advice on the credit report, however - i would not worry about paying the CC down, unless you can pay them off this month. you have to allow the time for the report to get back to the credit industry to make any difference.
All good stuff. Just wanted to add something about this part. When I bought my house a few years ago, I had paid some things off right before that, and the bank I was buying the house through accepted letters from the creditors saying that the items had been paid off, even though they still showed up on my credit report.

Also, all the money that everyone is giving you, put it in the bank now (I can't remember how long it needs to be in there), otherwise you'll have to get notorized letters from them all stating that it was a gift and that you don't have to pay it back. Not a big deal, but still more trouble to go through...
 

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Wow, I wish I could buy a house for $70k out here. We bought our single story house (closed 31 Dec 02) for $154 OTD w/ all closing costs included. Fixed interest at 5%. Square footage is a measly 1521 sq feet and sits on a standard 40 x 60 lot.(VA Loan, so had to pay an origination fee, also financed 100% with no PMI due.) Anyway, the same house is now selling for $240k. This market out here is absolutely absurd for what you pay for. I guess its all attributed to the fastest growing city in the U.S., at a rate of more than 7,000 a week move here. Gotta love Vegas.


I agree with all above mentioned about buying now if possible. To me, a house is the best investment one can make, as the values rarely drop and always are going up. (it's not like a car, put it that way) My two cents...
 

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bubba said:
If you do not put 20% down you will pay PMI (Private Mortgage Insurance) and it can be quite costly So make sure you take that money that you are receiving and use it for the house.
Note to everyone: If you have paid more than 20% in equity, don't forget to cancel this insurance. I read a story about people who paid above the 20% line, and are still paying this insurance.

Dookie I wish I could get one for 154k. The average price where I am living is around half a million. And I keep saying it that way to make sure I realize how much I am about to pay.. Or owe...
Fig
 

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Fig said:
Note to everyone: If you have paid more than 20% in equity, don't forget to cancel this insurance. I read a story about people who paid above the 20% line, and are still paying this insurance.

Dookie I wish I could get one for 154k. The average price where I am living is around half a million. And I keep saying it that way to make sure I realize how much I am about to pay.. Or owe...
Fig
We don't count the zeros anymore where I live. It's just too depressing. I thought I saw an outhouse going for half a mil the other day.
 

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If you pay off credit cards, don't cancel them unless you have no self control. Take the card, put it in the shredder and never use it again, but don't cancel the account (unless it has fees). Paid off, active credit cards are actually good for your credit score, canceled cards don't do you anything.

However, if you (or your significant other) don't have the discipline to not use the card, IMO you should pay it off and cancel it.
 

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Check your credit report thoroughly, as I find an average of 5 major mistakes in mine every year. Some of the creditors will basically never take you off unless you get right in their face. One of the credit bureaus showed me as owning 2 motor homes and 2 houses (showing my debt ratio right off the scale). When I reviewed the information, both accounts were correct for the first entry, but then they added a leading zero to both accounts and added them in as well. When I pointed this out to them (in writing, as per their directions), they blew me off and kept the entries on until I had one of my clients (a legal collection service) threaten to have their lead attorney disbarred. Be careful about applying or shopping for a loan prior to buying your house, as most people nowadays "shop around" on the internet for the best rate and pre-approval. Each hit the prospective lenders make on your credit reports can have a negative effect on your credit score.
 

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When I was 17 I was turned down for my first loan because of bad credit. WTF? Somehow it turned out I had a bankruptcy 5 years before. :rotfl:

It actually did turn into a much more significant PITA than you might imagine though, even though I was obviously 12 at the time it took a long time to get it fixed.


Where do you guys get credit reports? I haven't checked mine since then, and it would probably be a very good idea.
 

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luvtolean said:
When I was 17 I was turned down for my first loan because of bad credit. WTF? Somehow it turned out I had a bankruptcy 5 years before. :rotfl:

It actually did turn into a much more significant PITA than you might imagine though, even though I was obviously 12 at the time it took a long time to get it fixed.


Where do you guys get credit reports? I haven't checked mine since then, and it would probably be a very good idea.

THAT exact thing happened to me. I said - how can I declare bankrupty when i was 13

use this link for credit scores

http://www.equifax.com/
 
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