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#1
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About to buy a house
I'm starting the home-buying process for the first time. I'm going through mortgage pre-qualification right now. Anyone have tips or advice, whether it be from the loan or the purchase standpoint? I'm looking at a duplex in a community being built, so I could have a new place.
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#2
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Re: About to buy a house
Kiss your free time goodbye...God I wish I were still renting. On a more serious note, make sure you mention to your loan agent that you want a HOMESTEAD EXEMPTION tied to your loan. If you don't get this then you gonna pay more property taxes.
Indy |
#3
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Re: About to buy a house
Put in the Purchase/Sale agreement that closing is contingent upon approval of financing. Find a banker that is willing to decline financing if you ask. Find an appraiser that will lowball it for you. Use your appraisal to beat the seller down on price, knowing you always have an out because your financing may be "declined."
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#4
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Re: About to buy a house
Sounds like something that will land you in court...aint too ethical either..
Indy |
#5
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Re: About to buy a house
[ QUOTE ]
Sounds like something that will land you in court [/ QUOTE ] Absolutely not. You are abiding by the terms of your contract. [ QUOTE ] ...aint too ethical either.. [/ QUOTE ] Maybe the way I worded it. But there is nothing wrong with giving yourself an out in the contract, finding an appraiser who supports your position on the valuation of the home, and fiercely negotiating for the best possible price. That is business. |
#6
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Re: About to buy a house
Make sure that, if you don't have 20% for a down payment, that you get an 80/20 loan (or put 5% down and get an 80/15, etc). You do NOT want to be stuck throwing away money on PMI.
For what its worth, I went through Wells Fargo for my mortgage, and it was a very pleasant experience. I highly recommend them. |
#7
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Re: About to buy a house
[ QUOTE ]
Make sure that, if you don't have 20% for a down payment, that you get an 80/20 loan (or put 5% down and get an 80/15, etc). You do NOT want to be stuck throwing away money on PMI. [/ QUOTE ] Or get an 80/10/10. Get a mortgage for 80%, put 10% down, and get a Home Equity against that 10% for the remaining 10%. You can probably get a better rate on the HELOC than on the mortgage (so you're paying less interest against that 10%), and you don't have to pay PMI. PMI definitely blows, do what you can avoid it. |
#8
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Re: About to buy a house
What is an 80/20 loan?
What percentage is Property Mortgage Insurance tax? |
#9
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Re: About to buy a house
[ QUOTE ]
What is an 80/20 loan? What percentage is Property Mortgage Insurance tax? [/ QUOTE ] 80/20 means you put 20% down, and get a mortgage for the remaining 80%. Generally speaking, if you take out a mortgage for more than 80% of the property value, the lender will require you to pay mortgage insurance. The reason for mortgage insurance is that if you default and they need to forclose on the property, there's a good chance that they will not recover the full value of the property in an auction, especially after the costs of forclosing and seizing the property. So, because you are mortgaging more than 80%, they are going out on a limb with you, because if you default early in the mortgage (before you've paid much off), they stand to lose money on the deal. Mortgage insurance insures the lender against this loss, but you have to pay the premiums for it. You'll get a fee attached to your money payment, and you will have to pay it periodically until you owe the lender less than 80% of the property value. In recent years, many people have gotten their properties reappraised a year or two after the mortgage is closed, because even though they have not paid much off, the value has increased, which puts them below the 80% threshold and gets them out a mortgage insurance. Some lenders offer 95/5 or 90/10 mortgages the do not require mortgage insurance, but these are usually special programs. Either they are backed by FHA (which will probably require you to be poor), or they screw you with interest or terms. |
#10
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Re: About to buy a house
[ QUOTE ]
[ QUOTE ] What is an 80/20 loan? What percentage is Property Mortgage Insurance tax? [/ QUOTE ] 80/20 means you put 20% down, and get a mortgage for the remaining 80%. [/ QUOTE ] This is not what an 80/20 loan is. The 20 part is a second loan for 20% of what you're paying. It lets you get around PMI, which you have to pay up until you have 20% equity in your home. Basically, think of it as you're getting your mortgage for 80% and then you're borrowing the other 20% (at a higher interest rate) to put up as your 20% down so you don't have to pay PMI. |
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