I'm also looking at buying my first house. Will someone explain why PMI is so bad? My options with conventional are 20% down at 4.25% for 30 years or go FHA--3.5% down and 3.75% for 30 years plus roughly 5 years of paying 1.25% PMI until I own 20% of the house. If I can save the 16.5% on my down payment and invest the money, I only have to make 6-7% each year to be breaking even.

 

Originally Posted by Prestonluv

Check the local neighborhoods to see if there is any Section 8 housing developments. These are often full of single parents and neglected kids. The local middle and high schools often have drug problems as a result.

Find a neighborhood where there is not one of these close by imo.

Just an FYI, this isn't a bad idea but is something your realtor will never mention for legal reasons.

 

Originally Posted by swizbeatz

This is completely dependent on what the market is like in his specific area. You basically described a buyers market but it hasn't been like that around me in 9 months at least if you want something even remotely nice.

very true...i feel like its a safe assumption to say OVERALL the national market is a buyers market. Certain places have stronger markets (denver is one place) where this strategy obviously wont work. either way, i thinks a good idea to make a list of places youd be happy with, rather than zeroing in on the 'dream house'...keep your emotion out of it.

 

Originally Posted by NUTZREALHUGE

very true...i feel like its a safe assumption to say OVERALL the national market is a buyers market. Certain places have stronger markets (denver is one place) where this strategy obviously wont work. either way, i thinks a good idea to make a list of places youd be happy with, rather than zeroing in on the 'dream house'...keep your emotion out of it.

I agree the majority of places are like that. I work in Ann Arbor, if you aren't able to see a home within 2 days of it coming on the market and offer 98-110% of the asking price right off the bat you aren't getting a nice home, its just crazy. I had my eye on a condo complex and have put all cash offers 5-10k over asking and have been outbid on 3 already.

Edit- actually when you start looking this would be a great question to ask. "How many months of inventory are on the market currently." We are at 3.5 months for homes and 1.5 months for condos which is the indicator being used by good agents to know how to still get their clients homes. I have clients that want/need to move so they follow my directions above in terms of dropping everything to go see 1 home a day etc. It's a pain in the ass but necessary. 6 months is generally the tipping point between buyers/sellers market. Inventory means if no new homes come on the market how long would it take at the current rate homes are selling until there aren't any left.

make sure your insurance is active from day one then buy right in the path of a hurricane imo

Makes November nine
Considers putting down 3.5 percent on home

 

Originally Posted by rebelfd

You're also assuming the value of the home won't erode.

of course, that hurts me the same regardless of how much i put down though, correct?

 

Originally Posted by rebelfd

Why wouldn't you put the 20% down and pay yourself what you would have paid in PMI and use that as an emergency fund/savings account?

I could also use the 16.5% as an emergency/savings fund and pay the PMI as my investments appreciate...

Anyone agree with this statement:

"Yes, your math is right, if you can make 6-7%+ its a net gain. You are maintaining more liquidity, but you are also increasing your risk."

man, this has been anything but fun. Does anyone have experience w short sales?

 

Originally Posted by XquiziVex

I've bought a couple. Whatcha want to know?

advice? worth it? i dotn want to put an offer on a house and wait 6 months for the bank to just tell me no then i am back to square one. id rather offer them more if they would take it to get it doen faster. my agent is trying hard to talk us out of it.

 

Originally Posted by Cmoney3

advice? worth it? i dotn want to put an offer on a house and wait 6 months for the bank to just tell me no then i am back to square one. id rather offer them more if they would take it to get it doen faster. my agent is trying hard to talk us out of it.

I had a fairly good experience with the purchase of mine. Other than the long wait in processing (about 4 months on both) it went pretty smoothly. Granted, my purchases were about 3 years ago in the height of the short sale sell off. Even worse, Bank of America owned my properties which, at that time, was the absolute worst bank to deal with.

The one main thing I would recommend, that sounds like it's not in your favor, is having an agent who has experience (and optimism) in working on short sales. It takes someone who has patience, tenacity and not looking for a quick payday. It sounds like your agent may not be the person you need. My rep was on the phone calling the bank and the listing agent constantly. This was a big help.

If you have your cash/financing in line and ready to go, and you put in a reasonable offer, it was my experience that the bank won't reject you. You won't have to wait six months to hear back. My offers were accepted immediately. The wait came in the actual processing of all the paperwork and finalizing the sale.

Make sure the house you pick is what you want and that it hasn't been (or wont be) damaged by disgruntled owners/renters. Even still, you'll probably need some cash on hand to make some improvements. Other than the long wait in closing the sale, and maybe some costs in getting it into shape, it's a great way to get a deal on a nice property.

 

Originally Posted by USCphildo

I'm also looking at buying my first house. Will someone explain why PMI is so bad? My options with conventional are 20% down at 4.25% for 30 years or go FHA--3.5% down and 3.75% for 30 years plus roughly 5 years of paying 1.25% PMI until I own 20% of the house. If I can save the 16.5% on my down payment and invest the money, I only have to make 6-7% each year to be breaking even.

Any chance your looking back in Mt. Pleasant (there is a reason I'm asking).

Dont have any advice just wanted to give cmoney a pre congrats and good luck. 5 years ago he gave it to me straight when I was still learning my way through this game and challenging randoms (him) to hu4rollz lol.

any experiences w Maronda homes? found an awesome new build today

offer made, they countered, i returned and they took it! sign the contract this weekend and move in in a month! exciting,

ps taxes are absurd, i see why school levies always fail. i mean i have to pay $400 a month in fucking taxes for the privilege to live in a house i am paying for. jfc