I'd say it is rarely cheaper in this area once you account for property taxes.

7/22/2008 11:33:37 AM

SECU's ARM went up to 5.25% a few weeks ago.

7/22/2008 11:36:14 AM

property tax isnt so bad, you can call them and offer to sell them the property at the price they list and they'll give you a discount

seriously try it!!1

7/22/2008 11:36:34 AM

Quote :

"property tax isnt so bad, you can call them and offer to sell them the property at the price they list and they'll give you a discount"

?????

7/22/2008 11:38:35 AM

haha

mix of true story and a continuation of my theory of never take financial advice from tww when my hero clark howard is only a phone call away

the 'story' is likely totally irrelevant to new cars or houses or anything, i just posted it as a jjjjjjoke

but i did call the tax office many years ago when i had a 92 sentra. they valued it at something like 3k... i called them and said "SOLD FOR 3000 DOLLARS"

ignore me, ignore tww

7/22/2008 11:49:08 AM

Quote :

"year 1 and 2: 4.75% year 3 and 4: 5.75% year 5 and 6: 6.75%"

remember, this is WORST CASE SCENARIO.

loans right now are adjusting at the INDEX + MARGIN around 5%.

7/22/2008 12:52:03 PM

Quote :

"has anyone mentioned that their mortgage is pretty much cheaper (minus insurance and hoa) than their rent was when they paid rent"

Mine isn't

Then again, I lived in a shithole for like $300 a month before I bought my townhouse, so paying significantly more was pretty much a given.

7/22/2008 2:28:15 PM

Quote :

"has anyone mentioned that their mortgage is pretty much cheaper (minus insurance and hoa) than their rent was when they paid rent"

i was paying $325/mo + utils in a 2br/2ba 1200sqft townhouse in falcon ridge for 3 years before i bought - after everything is all in it was more than a grand less/mo to rent in raleigh than to buy where/what i did in atlanta

i was living well under my means in raleigh for a while though

7/22/2008 3:06:45 PM

Quote :

"remember, this is WORST CASE SCENARIO. loans right now are adjusting at the INDEX + MARGIN around 5%."

exactly...i'm trying to assume all hell's gonna break loose, because who knows where we'll be in 22 months when my loan adjusts...heaven knows, i'd love for it to not go up at all, or (please please please) go down

7/22/2008 3:17:07 PM

also, keep in mind just because you can get approved for an amount doesn't mean you should take out anywhere near that maximum. I got approved for approximately 3x my yearly salary, but there is no way i could afford those payments and still do other things. One thing first time buyers need to look out for is being house poor. I have some friends in my income bracket that went with more expensive houses (10-30% more then what i payed) that are stuck eating roman noodles and having half the rooms in their house empty, because while they can afford their mortgages, they don't have a lot of money leftover for other things.

7/22/2008 4:24:29 PM

i'm putting this in here so i know where to find it again

8/1/2008 10:51:39 AM

yay getting a mortgage and watching rates plummet a week afterwards

why can't i ever win?

9/8/2008 5:23:54 PM

How much should I plan to pay in monthly bills (water, electric, what else might be applicable)? How much does (ballpark) homeowner's insurance cost?

I'm trying to figure out if I can afford to buy a house or not. Based on a payment calculator I just wrote, I'd probably be looking at $1300/mo for the mortgage. If I add on $500-$600/mo as an estimate for water+electric+phone+internet+tv, that would be about half of my monthly pay after tax. (If utils turn out to be more than that I'd just cancel TV, possibly internet -- I have no idea how much electricity or water I'd use by myself).

The county real property tax would be 0.00305% value / year. Is there a state property tax?

I already own my car and insurance on that is like $80/month. I own no appliances or furniture other than a clothes dryer, so I can only afford to put ~$3000 toward down payment + closing costs (yes I know that's virtually nothing).

Just for the sake of completeness, my base salary is $5667/ month (before tax). I'm looking at houses below $150k (of which there are plenty in Brunswick county). When I do buy a house, I'll probably put up an add on craigslist for a roomie, but I'm not gonna hold my breath on that, since I'll probably be far from anything of interest.

Thanks in advance.

9/8/2008 6:46:50 PM

i'm getting a place at about 160K and the good faith estimate places the monthly rate at about 1250-1300 after mortgage, taxes, and insurance if that helps

7.25%, nothing down, no PMI

i'm going to see if i can find a new mortgage (hopefully an 80/20 so i don't have to put anything down, but we'll see) that can close on time now that rates plummeted and see if i can cancel my current app (i'm going to have to eat some money on that )

any chance appraisals can transfer mortgage companies?

9/8/2008 9:44:57 PM

Quote :

"$500-$600/mo as an estimate for water+electric+phone+internet+tv, "

Seems a tad overkill. I pay $60 for water every 2 months. I pay about $150 a month with gas + electricity for my 2000 sqr foot place. Internet + tv is $120 and insurance is $380 a year for $180K coverage.

9/8/2008 10:13:31 PM

i pay just shy of $950/month on a $160k house/land

that's at 4.75%, no down payment, no PMI, after taxes and insurance

electricity runs just a bit less than $100/month for 1620sqft, water is $30/month, intarweb is $35/month

so my total is about $1100/month, give or take $5-10, depending on heating/cooling

9/8/2008 10:24:44 PM

^^^I calculated my payments based on 15 and 20-year mortgages and they come out almost the same! The lower rate in the first few years makes a HUGE difference (tens of thousands in the long run). The 15-year rate and the 20-tear rate are only a half a percentage point different. The 20-year payments come out like $50 less than the 15-year payments, but you make 60 more of them!

^^ & ^ thanks for the input


EDIT: FUCK, the fixed interest rates went up a quarter of a percentage point between my original post and now!

[Edited on September 8, 2008 at 10:28 PM. Reason : ]

9/8/2008 10:25:29 PM

^That has a typo I meant $150 (not $50).

15-year payment: $1289 x 180 = $232,020 ($149.9k @ 6.25%)
20-year payment: $1142 x 240 = $274,080 ($149.9k @ 6.75%)

Either way, the bank makes a dickload on mortgages.

9/9/2008 9:38:34 AM

Why don't you want to go with 30 year fixed?

9/9/2008 9:43:27 AM

30-year payment: $1023 x 360 = $368,280 (149.9k @ 7.25%)

I don't know about you, but if I held on to the money, there's no way it would grow faster than the 7.25% rate on the mortgage. If you can invest your money and consistently get returns greater than your losses due to interest on your mortgage, then go for it. I'd rather not have to pay for the same house 2.45 times just to own it. ESPECIALLY, when the difference is only $200 a month. Save $200 elsewhere and put it into your house. Thank me later.

[Edited on September 9, 2008 at 10:36 AM. Reason : -]

9/9/2008 10:35:14 AM

i don't understand why all you people are looking at going with fixed rates right now, anyway...unless things have changed drastically, you can get a 2-year ARM that's 2 points below current fixed rates

that means that if you've got a 1-point cap every 2 years (like SECU does), you won't even reach the fixed rate for FOUR years, and then you're there for 2 more...so for SIX years, you're beating or at the current rates...re-finance after 6 years if you're still in the same house...even if you don't re-finance, and the 2-year change reaches the cap every 2 years, you won't be paying any more for EIGHT years AND you got to keep your money at the beginning

9/9/2008 10:40:25 AM

^ It's 5.25 at SECU if you put less than 10% down. VS the 15-year fixed, it's a 1 point difference. On a 150k mortgage youd save at least 3k in 2 years, absolutely (and interest on that 3k for the next 2 years)

I don't know the cost associated with refinancing though. I obviously need to talk to a lender to get all the details. I'm actually leaning towards doing that, I was just using the fixed-rate mortgages as examples, because there you can directly calculate the bottom line. I was just showing that even a 30-year vs a 15-year mortgage doesn't greatly affect your payments, but it has a huge effect on the bottom line.

I think everyone here would agree saving money is a good thing.

[Edited on September 9, 2008 at 10:51 AM. Reason : ]

9/9/2008 10:50:27 AM

Quote :

"It's 5.25 at SECU if you put less than 10% down. VS the 15-year fixed, it's a 1 point difference."

wow...when i bought my house back in may (and when i got my loan at SECU), 2-year ARM rates were 4.25% if you put 10% down (but PMI was required) or 4.75% with nothing down and no PMI

fixed rates were 6.25/6.75%, respectively (hence my assumption of a 2-point difference)

the market is starting to blow donkey balls

9/9/2008 11:01:18 AM

Rule of thumb, if you're going to be in an area longer than 2-3 years, buy.
If you're going to move within 5 years, get an ARM
If you are uncertain, or staying in you house longer than 5 years, look at 30-year fixed.

To look at anything else is just silly. Get the 30-year fixed, make sure you don't have any pre-payment penalties, and if you want to pay it off in 20 years or 15 years, just pay more than what you're billed each month, it keeps your interest rate low, less likely to need to refinance.

ARM is about the dumbest move you can make unless you KNOW you are moving in under 5 years (typically). Just do the math and be smart about it.

Depending on the market, a conventional mortgage will require 5-10%, more if you're in a soft market.
With an FHA, you can go as low as 0%.

No matter what you'll pay PMI, there is NO WAY AROUND THIS. If they say you don't pay PMI, what they mean is that they will pay it for you and ROLL-IN the financing of the PMI into your mortgage cost. Don't be fooled.

[Edited on September 9, 2008 at 12:41 PM. Reason : .]

9/9/2008 12:39:28 PM

Quote :

"ARM is about the dumbest move you can make unless you KNOW you are moving in under 5 years (typically). Just do the math and be smart about it."

which is why i went with an ARM...i sure hope i'm not here in 6 years (when it will reach the point of costing what a 30-year fixed would have cost)

Quote :

"No matter what you'll pay PMI, there is NO WAY AROUND THIS. If they say you don't pay PMI, what they mean is that they will pay it for you and ROLL-IN the financing of the PMI into your mortgage cost. Don't be fooled."

i respectfully disagree...on the break-down sheet for my mortgage payment, NOWHERE is there a line item for PMI, nor are there any miscellaneous-type line items or generic fees...if there's PMI, then they're out-and-out lying to me about it, and rolling it into something and not telling me

9/9/2008 12:54:24 PM

Soooo how about someone in my situation with 20% down on a 180k house (lets say), but making a little less than 50k / year? I plan on staying here awhile.

9/9/2008 1:13:18 PM

i'm staying fixed since i plan to keep the place indefinitely and rent it out after i'm done with it

[Edited on September 9, 2008 at 1:44 PM. Reason : and i don't want to risk having to refinance with an ARM - what if the rates are shitty? ]

[Edited on September 9, 2008 at 1:46 PM. Reason : ^i personally think that's a bit too much to spend on a house with that earning]

9/9/2008 1:44:18 PM

Quote :

"If you are uncertain, or staying in you house longer than 5 years, look at 30-year fixed. To look at anything else is just silly. Get the 30-year fixed, make sure you don't have any pre-payment penalties, and if you want to pay it off in 20 years or 15 years, just pay more than what you're billed each month, it keeps your interest rate low, less likely to need to refinance."

What?! Why would this be a good idea? Paying a 30-year mortgage in 15 years (assuming no early payment penalties, same 149.9k I've been using) requires a $1373 monthly payment, compared to $1289 for the 15-year interest rate. Why should I give the bank an extra $1000/year if I have the means to pay for the house in 15 years?

9/9/2008 1:49:54 PM

Quote :

"30-year payment: $1023 x 360 = $368,280 (149.9k @ 7.25%)"

Is your credit bad? You should be able to do better than that.

Quote :

"I don't know about you, but if I held on to the money, there's no way it would grow faster than the 7.25% rate on the mortgage. If you can invest your money and consistently get returns greater than your losses due to interest on your mortgage, then go for it."

You should be able to do better than that rate over long term, especially if you consider the tax deduction.

9/9/2008 1:58:56 PM

Quote :

"^i personally think that's a bit too much to spend on a house with that earning"

I think he'll be fine. He should be able to swing the payments for a loan for 144K although it's pretty easy to do the math just to make sure.

9/9/2008 2:02:09 PM

Quote :

"i respectfully disagree...on the break-down sheet for my mortgage payment, NOWHERE is there a line item for PMI, nor are there any miscellaneous-type line items or generic fees...if there's PMI, then they're out-and-out lying to me about it, and rolling it into something and not telling me"

i'd ask for a truth-in-lending form and an amortization schedule, don't just go based off of the good faith estimate. if you don't put 20% down and you aren't paying PMI, you have one ghetto lender.

9/9/2008 2:43:48 PM

Not really. They roll it into the loan sometimes.

9/9/2008 3:04:48 PM

that's what i just said earlier. quagmire02 seems to think that they don't roll it into your loan

9/9/2008 4:22:44 PM

Quote :

"i respectfully disagree...on the break-down sheet for my mortgage payment, NOWHERE is there a line item for PMI, nor are there any miscellaneous-type line items or generic fees...if there's PMI, then they're out-and-out lying to me about it, and rolling it into something and not telling me"

Of course you don't see it. They just tack on an extra 1/8 of a point onto your rate.

9/9/2008 4:24:31 PM

Yeah the rate is higher with no PMI usually.

9/9/2008 8:30:20 PM

Quote :

"I think he'll be fine. He should be able to swing the payments for a loan for 144K although it's pretty easy to do the math just to make sure."

I agree.


People don't save 30 grand over night. He obviously has some self control.

9/9/2008 9:11:43 PM

Quote :

"Of course you don't see it. They just tack on an extra 1/8 of a point onto your rate."

but then it's not technically PMI, is it? if all y'all are saying is that your rate is higher if you have no PMI, well no shit

i'm disagreeing with the implication that you are technically paying it as a line item, but that they actively lie to you about it

9/9/2008 10:59:01 PM

Quote :

"No matter what you'll pay PMI, there is NO WAY AROUND THIS."

VA loan.

9/9/2008 11:12:15 PM

^ Damn straight

9/9/2008 11:20:34 PM

i don't know what the hell i'm gonna do, though.

i want to live in morehead city or newport/down by the bogue sound, want a 3 bedroom/2 bath, 2 car garage, walk-in closet in the master bedroom, and no HOA/restrictive covenants, and I don't want to spend more than $175k (less would be just fine, but that's my limit). I have $20k saved up to put down (I'll have a shit ton more than that after this deployment, but all of that is reserved for me to have a helluva good time during the months that I'm home).

I don't want to live in a house by myself. it's too expensive, and i'd get bored. problem is, there is only one other officer in my squadron who's single, but he already owns a house. the story is largely the same in the other squadrons--i only know one guy who's single and doesn't own a house, and there is no fucking way i would let him live in a house that I own (fun guy to rage with...terrible guy to live with).

i want to get in on home ownership...hell, i'm turning 29 in a month, and i've saved up a bunch of money to do it. i want the tax benefits, and i want my own place where i don't have to answer to anyone. i have the VA loan program just waiting for me to put it to use, too...but being single and being deployed or on det all the time makes me wonder if it's really the right answer for me.

i might just rent a room from someone. someone else will probably be happy to get a good roommate for a few hundred bucks per month...then maybe i can buy a condo/"condotel" on atlantic beach or something strictly as rental income property.

9/9/2008 11:37:34 PM

if you can get over the not living by yourself thing, then I think the answer is pretty clear.
You have all the hard stuff covered, dont let potential boredom stop you from utilizing what you have available, ESPECIALLY looking at it from a financial standpoint.

oh yeah, buy a cheaper house and you wont need a roomate

Im shocked that at 29 you would actually want to have a roomate. Roomates suck

[Edited on September 10, 2008 at 1:05 AM. Reason : f]

9/10/2008 1:03:46 AM

Quote :

"Im shocked that at 29 you would actually want to have a roomate. Roomates suck"

amen...i'm 25, and at first thought i'd get a roommate to offset the cost of the mortgage...and then realized that since i could afford it by myself, and it's well worth it

walking around naked all the time FTW

9/10/2008 7:43:31 AM

Quote :

"i'm disagreeing with the implication that you are technically paying it as a line item, but that they actively lie to you about it "

Fine...."VA loan."

9/10/2008 8:50:34 AM

i don't know, man...i like having a roommate (or even 2) if they're good roommates. way more fun, and more money in my pocket.

as far as the financial aspect, i don't want a cheaper house. if i spend much less than what I'm planning on, it either won't have a garage (though i could make do with a 1-car if i lived alone), or it would be a total dump, or it would be in the ghetto, or a combination of the above.

what you have to understand is that the normal ways of doing things don't always really make sense for me due to the nature of my job. i mean, i'm heading to iraq for 6 months...when i get back, I'll be home for maybe 6 months, then off to Yuma, AZ for 1.5-2 months, then back for a month or two, then to iraq again for 6 months. if i don't have the expenses of owning a house and just rent a room from someone when i'm around, i pocket a shit ton of cash during those times when i'm gone.

in other words, strictly financially, i don't think home ownership is the answer for me. it's more of a matter of would it be worth it so i could have my own place and not have to move shit around twice a year.

9/10/2008 11:18:46 PM

...but i would like to buy while the market is so depressed. i'm gonna check into buying a beach condo to rent out.

9/11/2008 12:22:06 AM

Quote :

"has anyone mentioned that their mortgage is pretty much cheaper (minus insurance and hoa) than their rent was when they paid rent"

Paying $780/mon (including taxes/insurance, 6.25% with 0 down) on a $108k house & .4 acre (tax value bumped up almost $20k at last revaluing ). Rent at the last appt I was at was $850ish and that was 3 years ago.

No water/sewer (on a well/septic), $150/mon for electricity, $150/mon phone/TV/internet, ~$400/every 2 yrs for gas heating on 1200 sqft house. I went for a smaller house, one that could use some work (wanted a putz/fix it, but not a "fixer upper"), and I'm glad. More space means more crap.

Quote :

"I think he'll be fine. He should be able to swing the payments for a loan for 144K although it's pretty easy to do the math just to make sure."

Agree as well, as long as the job is a stable or replaceable one. Saving 20% will help a great deal, but don't get a payment that will be too difficult to make if something happens down the road.



A point to buy that I haven't seen yet; you have the freedom to change the property to your liking. Be that yardwork/remodel/etc, its nice to be constructive and help improve the value of your investment/home.

9/11/2008 3:01:04 AM

Quote :

"A point to buy that I haven't seen yet; you have the freedom to change the property to your liking. Be that yardwork/remodel/etc, its nice to be constructive and help improve the value of your investment/home."

not completely true. A lot of places are restricted to what they can do by local laws / convenants or HOA's

9/11/2008 7:14:03 AM

Quote :

"tax value bumped up almost $20k at last revaluing "

You do understand when your tax value gets increased you pay more in taxes?

9/11/2008 8:27:57 AM

Quote :

"You do understand when your tax value gets increased you pay more in taxes?"

i would assume he does...but at the same time, the market value of the house should also being going up (not because of the tax value change, but because of the circumstances that caused the tax value to increase)

a GENERAL rule i've always heard, and which seems to be pretty valid, is that tax value is 80% of market value

9/11/2008 9:50:15 AM

Where did you hear that?

9/11/2008 9:54:13 AM