Buying or Renting - Home Sweet Home

Metalfan · 03-18-2003, 09:18 PM

Better schools = higher property values = higher assessments = higher taxes.

Quote:they should only make people who have kids pay these taxes!

I have kids, so I'd be paying it anyway

Edited By Metalfan on 1048022521

Hey Ladi · 03-18-2003, 09:21 PM

Quote:they should only make people who have kids pay these taxes!

people who send their kids to private school have the same dilema, on top of tuition

Sweet Angel · 03-18-2003, 10:00 PM

If you have good credit, but a low downpayment, you can look into FHA loans. That's how I bought my house 3 years ago. It was comparable interest, but much much lower fees. Plus, a lot of times they'll add the fees into the mortgage for you so that you don't have to bring a fortune to closing. One drawback is that you have to carry private mortgage insurance, which is also added into your monthly payment (along with taxes and hazard insurance), but that's only until you have, I think, 30% equity in your house. Also, any repairs that the FHA appraiser deems necessary HAVE to be completed prior to closing. I had to get a roof put on my house before they'd let me close.

All told, I would much much rather own than rent. Even though it involved scrimping and saving and cutting back to be able to do it, I'd never change it.

Keep in mind, you'd also have to get a home inspection and termite inspection, but that's not big bucks.

kindred · 03-18-2003, 11:18 PM

Quote:but that's only until you have, I think, 30% equity in your house

Unless it's different from state to state, it's 20% equity to forgo the PMI. I was fortunate enough to have 20% downpayment for my house so I wouldn't have to have the extra $$ for PMI every month.

There are pros and cons to owning and renting. Homeowners get to deduct their interest every year come April 15. You can also deduct your closing costs too. I also have a Home Warrenty with my house so if anything breaks, it's covered by a small deductable. I had my electricity go off in half my house and it cost me a $35 deductable for an electrician to come out and fix everything.

Renting is nice because it's not your house. You can trash it and not have to worry about fixing anything. It just depends where you are in life and what you want.

There are a bunch of loans out there to choose from too. I heard something about 100% financing too. As long as your credit is good, you shouldn't have much of a problem.

Edited By kindred on 1048029592

Sweet Angel · 03-18-2003, 11:45 PM

Quote:Unless it's different from state to state, it's 20% equity to forgo the PMI.

It may vary from state to state, but my loan was an FHA loan, so that may be why it's higher as well.

Quote:I heard something about 100% financing too. As long as your credit is good, you shouldn't have much of a problem.

Exactly. I put less than 5% down on my house. My credit is excellent. I had to get the FHA loan because (a) my low downpayment and (b) I had a high debt to income ratio, so I couldn't qualify for a "conventional" loan.

I refinanced into a conventional loan at lower interest in December of 2001, 18 months after buying through FHA.

I wouldn't rent again EVER. When you own, you're in control...when you rent, the landlord is.

Metalfan · 03-19-2003, 12:13 PM

The other thing about PMI is that it does not go away on its own. You have to contact your mortgage lender when you think you have 20% or more equity in your home. They will then send someone out to re-appraise your home. If, after this new appraisal, you have more than 20% equity then you can request that they stop paying PMI every month. In most cases, this is found money for the mortgage companies because people just never get around to cancelling the PMI, so they pay it foreva.

Sweet Angel · 03-19-2003, 12:51 PM

They actually send someone out to re-appraise? I assumed when you paid of whatever percentage of your mortgage they require as equity, then you could cancel it.

See, learn something new every day.

Metalfan · 03-19-2003, 01:10 PM

Quote:I assumed when you paid of whatever percentage of your mortgage they require as equity, then you could cancel it.

That is definitely true of you go based on the loan-to-value ratio of your original mortgage. But, the way housing values have gone up around here lately, you could probably get to 20% equity a lot faster by having a new appraisal done rather than waiting to pay the note down.

Sweet Angel · 03-19-2003, 01:12 PM

Good point. I never thought of that. Of course, being that I just refinanced about a year ago, I'm probably still way under the equity %.

Hey Ladi · 03-19-2003, 02:04 PM

Quote:See, learn something new every day.

YES! thank you

Suzie · 03-19-2003, 02:29 PM

Quote:Renting is nice because it's not your house. You can trash it and not have to worry about fixing anything. It just depends where you are in life and what you want.

That's me! The rate I'm going I won't be able to afford a house for 5+ years. But that's ok cuz I don't wanna be tied down. And I have a good landlord who lives right down the block.

Skitchr4u · 03-19-2003, 04:03 PM

Quote:I heard something about 100% financing too

what if i told you there was a way to get 107% financing...no pmi...you put your money as a down payment, and get it back...sure your rate is a bit higher, but with no pmi, your payment works out almost comparable to if you did...and its no money out of pocket

Sweet Angel · 03-19-2003, 09:33 PM

Do you have a bridge for sale too?

Skitchr4u · 03-19-2003, 10:31 PM

sweet i am serious. if you would like i can email you our guidelines on the product...its all based on credit score

Sweet Angel · 03-19-2003, 10:43 PM

Thanks, but I already have a house...and I've already refinanced. The only thing I MIGHT be interested in is an equity loan.

Keyser Soze · 03-19-2003, 10:56 PM

i love my apartment. i'm going to have a hard time leaving it someday.

Hey Ladi · 03-20-2003, 01:55 PM

I'm gonna do it, I'm gonna buy a house :thumbs-up:

...... now I just have to start :banana:

Skitchr4u · 03-20-2003, 08:09 PM

sure ya are ladi, sure ya are

Hey Ladi · 03-20-2003, 09:39 PM

42 :-p

Paper Boy · 03-23-2003, 02:31 PM

i don't think buying a house makes sense unless you can pay for it without taking out a mortgage. i found this nifty little <a href=http://www.interest.com/cgi-bin/financial_new.cgi target=blank>site</a> that has an amortization schedule generator. it tells you how much of your interest and principal you'll be paying over the 30 years of your mortgage.

i figured a house will cost about 250,000 dollars. if you put 50,000 down, 20%, that leaves you with a mortgage of 200,000. at a rate of 8%, not everyone can qualify for 6%, you'll be paying almost 16,000 in interest the first year alone and you will have only reduced your principal by 1,600. in year 20, you'll still be paying 10,000 a year in interest.

i think it's better to rent and invest that 1,600 a year until you have enough cash to put down at least 75% of a homes purchase price.