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Discussion Starter · #1 ·
Well, me and my wife have a good combined income between the two of us. We have sat down and gone over the numbers again and again. We can aford to move into a nice house .

My wife works for Publix, a large company here in Florida and she meet a girl there whose husband in a realiter. We meet up with him and we got "pre-approved" for a loan that would buy us a house much better than we expected.

Well, I need advie. I'm 26 and have never done this. We both have good credit. I asked the guy over and over because I could not believe that we were approved for the loan. But, I'm not exactly sure what the difference or pre-approved and approved. I assume this simply means, once we deicded on a house, then the actuall paper work would be filled out and then its "approved".

Anyways, what I'm worreid about is little things that may slip my mind or that I would not even think to look at because I have never bought a home. Both houses we are looking at are fairly new. One was build in 1994 and the other is pretty new being build in 2001. We had serious hurricans pass thru here this year and nether showed any damage. I figure if they could stand up to 3 hurricans in a row, they are good built homes. Both have good rooves. No copper piping. Carpet looks great in the 2001 model and ok in the 1994. I noticed the 2001 one had raised ground for septic. I need to check the 1994 house. I assume some building code changed between thouse years. I wonder what that says about the 1994 home.

What other things should I look at? What about the financial side? I'm a worry wort and a complete tight wad so I can tell you know, I am very scared of getting ripped off or getting into a house we "thought" we could afford only to find out we are in over ours heads. But, like I said, we've looked at the bills over and over and we can bacisly aford either home on her income alone. Meaning mine being double what she makes would pay for other bills (food, gas, tv, etc..and maybe a real savings account someday?!? Nooo...)

Any help, heads up, look at this or that, would be GREATLY appericated. We're young and about to cook up some babies but need the house first. Advice needed(not on the making babies part, I've been practicing! :smile:)
 

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Pre-approved basically means they looked at your income and said, "OK, you can afford a $200K house" (or whatever). So they're willing to lend you up to $200K.

How much downpayment are you giving them? If you're not putting 20% down, you should look into a nifty financing option called 80-20 or 90-10 or 80-10 or something - basically you get two mortgages instead of one. The reason for this is that if your first mortgage is over 80% of the value of the house, you'll have to pay Private Mortgage Insurance (PMI) (covers the lender's ass if you default).

Houses that new shouldn't have problems with utilities yet.

Inquire of the owners how much the monthly bills are. If the windows suck, your heat/cold will go right out of them.

Check on what property taxes will be. If the lender doesn't escrow them, be sure to budget accordingly.

Definitely buy a house. You can write off all the interest at tax-time (imagine writing off 90% of your annual rent!).
 

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Congrats on the impending new house. You'll be amazed at the benefits come tax time. Back years ago, when I was renting, I'd have to take the standard deduction on my taxes, and would usually get around $700 or so back in tax refunds. Once I had a full year on my mortgage, I think my first year's tax refund was around $4,000. So get ready for a big smile at tax time. Now, on to the house buying process. If you don't have a realtor yet, get a good one that you can trust. Preferrably one that is a buyer's agent only. You don't want to have a realtor that's trying to sell you a house that they also are selling for another client. It's hard to look out for your best interests when they're also looking out for some seller too. So try to get an exclusive buyer's agent realtor. I have one I use and she's great. Then, get a third-party home inspector service to come thoroughly inspect the house you're looking at. (This is once you're settled on which house you think you like better.) The service isn't cheap, it's usually around $300-400, but it can potentially save you thousands in hidden repairs, etc. Also, make sure your buyer's agent realtor investigates any impending construction projects in the area. You don't want to buy your first home and then realize that a new highway is coming through your backyard in 6 months. (It happened to a friend of mine, half of his yard was taken away by the widening of the street in front of his house. The plans were already on the books, but his realtor didn't do her homework, and now he's stuck with traffic whizzing by just mere feet from his front door, and his home's value has dropped like a stone!) Good luck with the home-buying, there's nothing like being able to say, "HEY! You kids get out of my yard!" :lol: :lol:
 

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Discussion Starter · #4 ·
Thanks for the tips guys! We're going to look at it again tonight and meet with the reality agent again. I'll have allot of good questions for him! Thanks again!
 

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Also, be wary of adjustable rate mortgages. With rates being as low as they are, a fixed rate is the way to go if you plan on staying in the house for a long time. Otherwise, when the rates start "adjusting" after the first 5 years, you might find that you can no longer afford the payments on the house you've been living in. If you plan on moving within 5 years, get the adjustable.
 

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Buying Richmond America is OK! Just be sure you get a really GOOD home inspection! :lol:
Anyway, I'd suggest the following:
1. Get a house you feel comfortable affording (fVck what THEY say you can afford).
2. Unless you plan on staying in that house forever, get a 5/1 ARM.
3. Find a good realtor, and ask a milltion and 2 questions. If you can, get in a development that is still being developed...Every house being built SHOULD add to the appreciation of the house.
Good luck. Find a good realtor and rely on them. If they feel sleezy, get another!
 

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eScreaming Dizbuster
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[ QUOTE ]
WFO-900 said:
Do not buy the most expensive house you can afford.

Furniture, clothes and motorcycle gear is nice to have as well.... :smirk:

[/ QUOTE ]

:waytogo:

Also bear in mind your financial situation can change for the worse. And you don't want to be stuck in a job you hate because you can't afford to quit due to a huge mortgage payment.

It took me ten weeks to get my mortgage. "Good news", I was told, "you've been approved." Then I had to get approved again. And again. And again, I think. They really played it out.
 

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Figure out how much you can afford monthly for payments. The max amount you can afford. Figure out what you can afford with a 15 year loan for that much monthly and then get a 30 for the total cost you can afford for the 15.

Example:

Lets say you can afford 2K a month on morgage payments.

This comes out to about a 245K home at 5.5%

at a 30 year loan you monthly payments would only be 1391 a month on the same amount.

So you get the loan for the 30 year and pay it like its a 15. It gets paid off earlier and if hard times come you have room to breath.
 

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Do you and your wife have a CPA? If so, see if he / she has a relationship with a mortgage broker. Their job is to shop mortgages for you and the mortgage companies pay their fee - costs you nothing. A further benefit is, given the green light from you they can communicate directly with your CPA so you don't have to deal with minutia as it arises, which as TJ notes can be considerable. First time buyers or anyone without an active lender relationship should consider it seriously. Sort of like going to a dentist rather than grabbing some pliers and a bottle of JD. :grin:

Just a thought.
 

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Some quick thoughts that you can consider.

As others mentioned, avoid PMI.

Well, since you are thinking about a family you might want to look into what the schools are like in the various areas around you. Looking at SAT scores are probably a better indicator than the amount spent per student, but that's debatable.

Local property taxes; One of the towns I was looking at had a residential property tax rate of $200 more a MONTH than the next town over. Schools weren't any better either.

I saw a report on mold in homes, and how prevalent it is in high humidity places with air conditioning. Good home inspectors are worth it, spend the cash on one.

Shop around. Be patient but ready to strike.
 

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eModerator
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Everythings already been covered but I want to emphasize the importance of a GOOD home inspector. I just recently moved and the inspector I hired (House Masters, I 100% recommend them) took about 3 hours and went through everything- crawled the attic, checked out the whole roof, etc. Now the inspector the buyers of my old house hired was a joke. He spent barely 45 minutes and was telling the buyers bad info.

Other than that I can only repeat what has been said - avoid PMI, dont max yourself out on the payment, check out schools and taxes. One thing that hsn't been mentioned is check out the covenants (if any) They can get downright nasty and some things can affect bike riding. For example they might require all cars to be parked in the garage and that might not leave room for the bike :frown:
 

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I second that double check the HOA if there is one. Make sure you are fully aware of the fees. Also alot of HOA's will not let you park anything outside your house that isn't a standard car or truck
 

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Discussion Starter · #15 ·
Lots of great tips guys! Lots of stuff I didn't think about, you guys brought up so this has been a big help!

I have been swamping him with questions. I'll be asking about the parked cars today becuase I have a '66 chevy truck, wifes car, boat, and a bike. I'm thinking the boat will have ot be parked in the back yard. Which could be a problem.

We first started looking the the area we found the house in because of the schooling and I have friends who have lived there for years and the neigborhood is top notch. In fact, the property value and schooling are two of the main reasons the house is costing what it does. But, with that, as you guys pointed out, come surprises.

Example, I just found out there is a $200 a year community fee. Plus, rules on yard up-keep which is a good thing really but can hurt me with boat, bike. I have seen a Harley in one guys driveway so I believe as long as its in the garage, we should be ok. I looked pretty hard and I can fit the truck, car and bike(up in front, I have to move everything around to get it out, baaa).

The property value is shooting up too. So, with it being a fairly new home, built 2001, it meets all the new building codes, tested and proven thru three intence hurricans, and the neigborhood is completely full, the value should be even better when we do decide to sell. That side of town is also looking like it will take 10-15 more years before its developed like the rest of town. Its pretty removed from everything too. Back in the woods.

Our realiter is pushing though. That does NOT sit fine with me. I just talked with him and basicly told him to back off. If the house gets sold out from unfer us, oh well, we'll find another.

Anyways, I talked with my father-in-law and he pointed out that once you make a offer, you can't lower it. So, we are "thinking" about offering 10k less that list price. This is actually 5k less and asking them to pay closing cost.

Do you guys think that is low enough? Should I offer even lower? I would rather offer less than they want and have them come back to us and push for more. That way I know we are in the correct range. But then again, I'm sure everyone feels their house is worth more than they think.

No doubt there is allot here to consider. I'm completly new to all this. All I can do is ask for advie from everyone and keep praying. No doubt I've been blessed and this house is exaclty where we want to live and is almost what I dreamed about being the realistic perfect house for us. The fact we even found it gives me some hope in the house being the right one.

Still, I'm very worried. This tight-wad HATES paying to much for something, anything! Thanks again guys!
 
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