OT: Buying a house

[vexvelour]

As many of you know because of my angry 'asking for revenge on neighbors' (http://forumserver.twoplustwo.com/showflat.php?Cat=0&Board=exchange&Number=3995851&S earchpage=4&Main=3995851&Words=revenge%2C+neighbor s&topic=&Search=true#Post3995851) post, I need to move. I currently split the rent here with my boyfriend for a total of $1080/mo., + bills.

I seriously am sick of tossing a grand to the wind every month and want to start looking for a house to buy. I still have about 3 years before I get my degree, and he's got a great job here, so unfortunately we're stuck here for a while.

I need some advice and help from those more experienced than me in this. I really have no idea where to start, or if the amount of money I have is even enough for a down payment. I have a moderate amount of debt, but not over my head- mostly school loans. For those of you who have braved the process, please answer some questions for me:

-First of all, would you settle for a house in place you don't really like but is a great turnover investment opportunity?
-Is it possible to find the house of my dreams without a real-estate agent, and if so, what's the best way to go about it? (Newspapers, driving around, internet...) What did you do?
-What are all the things I'm not thinking of? Secret taxes, hidden maintence things, things of that sort. This def falls into the life experience category.

Sorry that was so long winded. Any advice would be super.

[samjjones]

I cannot possibly answer this question without seeing a topless pic of yourself first.

[Lottery Larry]

Look at the Bulldog thread I just bumped.

[vexvelour]

Fantastic, thanks a bunch...mods can delete this thread.
Sorry!

[jaydub]

Vex,

You need to do some research on your own. Your post indicates a deep lack of understanding about loan structures. That is not good.

1. Be careful about estimating investment potential, but yes of course.
2. No, you don't need an agent.

Also be careful when buying with a non spouse. That can get messy especially if you're not careful with the legalese.

J

[wh1t3bread]

[ QUOTE ]
enough for a down payment.

[/ QUOTE ]

There are plenty of ways to finance a house without putting down a single dollar. Talk to a few lenders to see what works out for you.

[ QUOTE ]

-First of all, would you settle for a house in place you don't really like but is a great turnover investment opportunity?

[/ QUOTE ]

If it's good real estate market purchasing a house that you are planning on turning over in 3-5 years would be a decent investment. For a few hundred more a month that what you are paying now for rent you can probably own and start building equity.

[ QUOTE ]

-Is it possible to find the house of my dreams without a real-estate agent, and if so, what's the best way to go about it? (Newspapers, driving around, internet...) What did you do?


[/ QUOTE ]

Newspapers, craigslist, friends, co-workers, etc would be the best places to look. As a buyer though using a real-estate agent will cost you $0 (the agents make their commission from the seller). However if you can find a house without using agents you can probably work with the seller on a better price.

[ QUOTE ]

-What are all the things I'm not thinking of? Secret taxes, hidden maintence things, things of that sort.


[/ QUOTE ]

Property taxes, condo fees, home owner association fees, etc. Any seller should be able to tell you exactly how much they cost. Don't forget closing costs. These can be expensive (but some might be tax deductible). A settlement agent should be able to give you a good estimate on closing costs.

Also if you do go without a real estate agent make sure you get a decent lawyer to draw up or review your contract before you sign. This will only cost $200-$300 and is well worth it. Also, make sure you get a home inspection this will cost a couple hundred but it pays for itself if they find something wrong.

[vexvelour]

[ QUOTE ]
Your post indicates a deep lack of understanding about loan structures. That is not good.

[/ QUOTE ]

Yeah, no kidding, after I read that other thread.

However I have a finance guy at my bank that has helped me handle many things. He's the one who has planted the thought of buying a house and would be more than willing to help me find the best deal in my interests.

[vexvelour]

[ QUOTE ]
Property taxes, condo fees, home owner association fees, etc. Any seller should be able to tell you exactly how much they cost. Don't forget closing costs. These can be expensive (but some might be tax deductible). A settlement agent should be able to give you a good estimate on closing costs.

Also if you do go without a real estate agent make sure you get a decent lawyer to draw up or review your contract before you sign. This will only cost $200-$300 and is well worth it. Also, make sure you get a home inspection this will cost a couple hundred but it pays for itself if they find something wrong.

[/ QUOTE ]

great advice, thanks!

[bwana devil]

[ QUOTE ]
Vex,


1. Be careful about estimating investment potential, but yes of course.
2. No, you don't need an agent.

J

[/ QUOTE ]

number 2 is correct but i would recommend getting one. the buyer's real estate agent gets paid out of the seller's pocket from the sale of the home.

[someone may argue that the buyer actually pays for this because it is worked into the price yadayaadyadya. well, usually people cant knock 3% off doing this and the OP is not sophisticated about the real estate market as it is.]

get a good referral and find a good agent if you go this route.

bwana

[jaydub]

bwana,

Absolutely I would recommend the same. An agent in my mind is most valuable when it is time for a first time buyer to close. Many costly mistakes can occur at closing.

J

[david050173]

If you buy a house how much money will you throw away on interest? When you pay rent you are not throwing money away. You are giving it to someone in exchange for a place to live. Which one is better depends on a lot of things. Real estate is the hot investment right now. Doesn't mean it will be in 3 years. And leverage works both ways

[jakethebake]

[ QUOTE ]
Fantastic, thanks a bunch...mods can delete this thread.
Sorry!

[/ QUOTE ]

Does this mean the topless pic will not be forthcoming? /images/graemlins/frown.gif

[ QUOTE ]
I have a finance guy at my bank that has helped me handle many things. He's the one who has planted the thought of buying a house and would be more than willing to help me find the best deal in my interests.

[/ QUOTE ]
This guy, no matter how scrupulous, cannot be regarded as an impartial advisor on the subject of whether or not you should buy a house. I am not surprised he suggested it.

[OtisTheMarsupial]

You currently pay about $1100 and feel like you're "tossing it away."

We'll begin with that assumption that rent is throwing your money away. You're forgetting the actual costs of maintaining appliances, landscaping, pool/rec room/ whatnot. If you buy a house, some of your monthly expenses will be "thrown away" too: You will likely have an HOA fee, repairs/maintenance expenses, loan interest payments, taxes...

This will be coupled with the gamble, yes, it's a gamble, that your house will actually increase in value. It may not. And even if it does increase, you might not actually make out on the deal. If you get trapped in a bad loan or if your boyfriend screws something up or if your agent's cut is too big or if you simply need to sell a little earlier than originally planned...

House buying is becoming more and more like car buying.

So, be careful about this. It might make more sense to keep rentinng and instead, take the extra chunk of money you'd pay for a house and invest it elsewhere.

[vexvelour]

Well, the investment part doesn't even really appeal to me. I have a really great mutual fund right now.

The thing about the market where I live is that there is a shortage of houses for rent. It's mostly a college town, and many 2nd-3rd year students are sick of random roommates, and looking for a house. This is how I'd go if I ever decided that I didn't want to live there anymore.

Thanks for the advice, everyone. Keep it coming.

[jaydub]

Otis,

Actually the "tossing away" fact you are missing is how little equity is gained in most loans during the first few years. That is where most first time buyers are woefully misguided wrt loan structures. The cost of maintenance is much more widely understood.

Gamble is not the correct word. It is an investment that carries substantial risk but terming it a gamble is highly misleading.

How is house buying like car buying? That made no sense to me.

J