I thought you were always old as dirt?
haha.. some days I can relate.
I thought you were always old as dirt?
Actually frank is correct. If you have no buyer's agent, you can negotiate away the customary 3% buyer's side commission. You MUST get it in writing and demand to see BOTH SIDES of the HUD to be sure the listing agent doesn't take both sides of the commission. A good idea to speak with the title officer and have them warrant the listing agent isn't getting both sides.
There's inherent risk if you don't know what you're doing because you are unrepresented and no licensed agent has any fiduciary duty to you.
If you feel you're qualified to go it alone, you can save the money... but you must be fairly methodical in the negotiation.
Anyone on this site can feel free to hit me up for advice any time.
The buyer pays no fee. No 3%. So I don't know what you're talking about?
The seller pays the full 6%. 3% goes to the selling agent's side, 3% goes to the buying agent's side. But in no way does that affect the homebuyer and what he or she is paying.
Damn... I have mad respect for educators.
I will get back to this when I feel like it.
Pretty sure Babe was pre-Madonna.
Damn... I have mad respect for educators.
I will get back to this when I feel like it.
So, anyway, Frank, I agree with you because I know you know what you're doing. The Doc resents being dissed when he's offering good help. Really, that is the same thing as telling the newb not to get an agent, isn't it?
Stoked should talk to several real estate agents and see what they're saying. It's perfectly true that a good RE agent will earn his pay working for you and save you some money. Lots of detail stuff a newb just isn't going to get all right.
Doc is wrong about one thing. Stoked is the buyer and doesn't have to offer as much as the seller is asking, so he just doesn't really need to pay what he's asked, even if some seller "sees him coming" and tries to score the RE commission cut. I'm not in the market to buy right now partly because I need to resolve some hanging issues before moving on to new ones, but partly because I believe there's a general selloff pending in our RE bubble generally, to bring prices in line with people's incomes. The "bailout" is still going on. . . banks getting soft money from the fiat press to loan out, interest rates being hammered to nothing. But Cedar City and St. George are a sweet spot a lot of people still want to land in, people with money from CA and LDS retirees from everywhere. . .
If Stoked has the down and the loan, he should be buying his home. I would suggest a conservative loan like a 15-year. He'll do OK if he learns what he can from Peeks and a few RE agents, and a lot of knowitall blowhards like me, as long as he lets Peeks be the one to cut out the commish.
So I rcently submitted the paperwork to see where I stood for a home loan and they told me that they could approve me for 160k right now. But if I wait and if I continue doing what I am doing they can approve 200k in the spring. I have never bought a home before, or any property for that matter. I am super relieved that my last two years of hard work and smart spending is paying off.
But since I am new to this do any of my more experienced forum members have any tips, warnings or recommendations?
Being financially prudent does not always involve not taking risks or considering environment and situation. The "live within your means" line when discussing a home purchase is possibly the worst financial advice you can give anyone. I've personally seen this several times. Buying more than you are comfortable with now can turn into one of the best investments you will ever make exactly for the reasons Colton mentioned above.
To Dave, and David Ramsey ^ ^^
Being financially prudent does not always involve not taking risks or considering environment and situation. The "live within your means" line when discussing a home purchase is possibly the worst financial advice you can give anyone. I've personally seen this several times. Buying more than you are comfortable with now can turn into one of the best investments you will ever make exactly for the reasons Colton mentioned above.
Also, with these low interest rates, never pay a dime extra unless you are planning on upgrading down the road and will need to stretch yourself further.
Conversely, there are thousands upon thousands upon thousands of people out there who lived beyond their means and once something came up (extra expenses because of an additional child, job loss, divorce, etc.), the mortgage prices couldn't be made and the house had to be sold, even at a loss. Or worse. Hence all the foreclosures, pre-forcelosures and short sales in the last decade.
Your advice, franklin, imo is irresponsible.
Nothing is just that simple.
That said, my wife and I are following your train of thought and are currently looking at houses whose mortgage payments after 20% down would be 42.7% of our net monthly income. We'd really be stretched thin for a couple years but our jobs are as safe as you get and our annual raises combined will up our total income by about 8-12% annually so we should be fine in 3-4 years. Plus we'd have a good amount handy in case we fell behind or something. And like you said, I look at it as investment. This house could very well be worth 2-3 times its' current asking price in 20 years or so when we retire years so that's huge.
So yeah, there's a lot to consider. A LOT.
P.S.--Regarding what Colton said in #3, yes, get a 30 year mortgage. But do not convert it to a 15 year when you get the chance. There's no need to pay the 3-4K in closing costs on a re-fi let alone tie yourself down to paying an extra 300-600 (give or take) a month if you don't have to. If you want to pay the house off quicker and cut back on pissing money down the drain on interest, just do what BigB said and pay off extra principle each month or whenever. Making one extra mortgage payment a year knocks eight years off a 30 year mortgage. So do the math. There's a ton of sites out there. If you feel comfortable and have a ton of cash liquid and maybe don't feel comfortable or knowledgable investing in the market, pay extra principle off your mortgage. Do that every so often and you could maybe turn that 30 year mortgage into a 10-15 year one. But this route at least gives you the flexibility. Re-fi'ing does not.
I'm different than most home buyers, as I look for the homes that need a lot of work when I am buying. I want to replace the entire water system and bring electrical up to code. Heck, I'm even ok doing the roof. I do make sure to have a new hvac though. I don't want to mess with the old garbage they used to put in.
If you are semi capable and willing to do a little bit of work, you can replace the entire plumbing system in most homes yourself for around $1500. If you don't k ow how to fix it, call me and I will explain what you need and how to do it.
For electrical, spend $20 on a wiring book and $100 on tools and learn how to update things. If you need a new panel, find a trustworthy electrician to come in, you can usually have that installed for less than $1000.
I am with Franklin om buying the upper limit of what you can afford. We bought the very most of what we could qualify for on our last home and just sold it and made $70 k on it after some repairs to update it
Like I said though I do all the work myself and don't spend any unnecessary money on the purchase price.
There are ZERO trustworthy electricians in Jazzlandia.
There are ZERO trustworthy electricians in Jazzlandia.
P.S.--Regarding what Colton said in #3, yes, get a 30 year mortgage. But do not convert it to a 15 year when you get the chance. There's no need to pay the 3-4K in closing costs on a re-fi let alone tie yourself down to paying an extra 300-600 (give or take) a month if you don't have to. If you want to pay the house off quicker and cut back on pissing money down the drain on interest, just do what BigB said and pay off extra principle each month or whenever. Making one extra mortgage payment a year knocks eight years off a 30 year mortgage. So do the math. There's a ton of sites out there. If you feel comfortable and have a ton of cash liquid and maybe don't feel comfortable or knowledgable investing in the market, pay extra principle off your mortgage. Do that every so often and you could maybe turn that 30 year mortgage into a 10-15 year one. But this route at least gives you the flexibility. Re-fi'ing does not.
Everything you put into a house is going to be wasted money when you sell to upgrade your starter home. Your shed, deck, counter tops, landscaping, cabinets playground, etc, etc.