|
Rolo posted:Sooo just shop around online for a building inspector, call three and use whichever I like? Your seller's realtor could recommend you an inspector, but they have an incentive to give you someone who will just loving ignore everything, so it's a bad idea Your realtor could recommend you an inspector, but while they're hypothetically supposed to look out for your interests many realtors are actually just scum and have an incentive to give you someone who will be chillax over things that you might not otherwise have noticed, so it's a bad idea Your bank could recommend you an inspector, and since A) the bank isn't paying for the inspection at all and B) the bank is on the hook if you just loving default some day and the house turns out to be worth a lot less than they loaned you, they actually have an incentive to recommend an inspector who will do a good job. So that's a pretty reasonable way thing to do. Our lender gave us a big sheet with a ton of inspectors that they recommended and basically said "feel free to pick one of these people, or don't, up to you" Then lastly there's word of mouth, online recommendations, just pulling numbers out of a hat, etc. which could be a crap shoot but at least that's better than going with the realtor's recommendation. Our inspector had a great rating on Yelp, plus we met some of his previous clients who were really happy with his report so that was good enough for us.
|
#
?
Feb 15, 2017 08:40
|
|
|
|
| # ? May 29, 2024 05:23 |
|
|
You can ask a prospective inspector to provide a sample of their report. If they can't or won't, thats a bad sign. Judge the sample not by length, but clarity and thoroughness. Understand the sample is like ke a portfolio piece... likely your report won't be quite as good, but it's still useful to see.
|
|
#
?
Feb 15, 2017 09:11
|
|
|
QuarkJets posted:Your bank could recommend you an inspector, and since A) the bank isn't paying for the inspection at all and B) the bank is on the hook if you just loving default some day and the house turns out to be worth a lot less than they loaned you, they actually have an incentive to recommend an inspector who will do a good job. So that's a pretty reasonable way thing to do. Our lender gave us a big sheet with a ton of inspectors that they recommended and basically said "feel free to pick one of these people, or don't, up to you" The downside of banks is that they are, uh, idiots.
|
|
#
?
Feb 15, 2017 12:50
|
|
|
Bozart posted:The downside of banks is that they are, uh, idiots. Yeah, and they have an incentive to get this money loaned to you, with ultimately pretty minimal downside that they're going to end up owning the property.
|
|
#
?
Feb 15, 2017 14:02
|
|
|
Banks make waaaaaay more money off of you paying your mortgage than they do foreclosing on a house, that's sort of the point of fractional reserve banking. There is zero incentive to foreclose except in some hokey unethical reverse mortgage situations.
|
|
#
?
Feb 15, 2017 14:55
|
|
|
Most banks just sell the mortgage off right away anyway. That said, if your bank recommends a bad inspector it is likely out of incompetence rather than malice, unlike either realtor involved in the transaction. So whatever list they might give you is probably the least bad option between them, the seller's realtor, and your realtor. Thoguh fucked around with this message at 17:43 on Feb 15, 2017 |
|
#
?
Feb 15, 2017 15:17
|
|
|
I feel like you should try to find an inspector that all the realtors hate on general principle, but I am not sure how you would actually locate that person.
|
|
#
?
Feb 15, 2017 15:23
|
|
|
Ashcans posted:I feel like you should try to find an inspector that all the realtors hate on general principle, but I am not sure how you would actually locate that person. If you search yelp reviews (particularly the Not Recommended area), you'll find them. This a review for my inspector, who was fantastic: 
|
|
#
?
Feb 15, 2017 15:29
|
|
|
minivanmegafun posted:If you search yelp reviews (particularly the Not Recommended area), you'll find them. This a review for my inspector, who was fantastic: It's the inspector we've been looking for!
|
|
#
?
Feb 15, 2017 15:53
|
|
|
marchantia posted:Re: poster freaking about exclusivity contract with buyer's agent, that's super common in my experience. My buyer's agent sets up all my visits and drafts all my paperwork, he should get the money at the end of the transaction. Not sure why it's a problem? You can fire then whenever and work with someone else if they suck. And fwiw in the market I'm in, if you didn't submit within 24 hrs of the open house, they are in negotiations with a buyer already that showed up with an agent. Also get a well reviewed agent instead of a friend of a friend. Couple of things. First, from how the agent explained it to me, it wasn't an exclusivity contract for this particular house, which I would have been fine with, it was "if you make an offer on any house in the next year, it must be through me." After I complained about this and made it clear I would be able to find another agent to submit my offer without this clause, the broker's concerns mysteriously disappeared. As far as I can tell, it wasn't as simple as "fire your agent and get another if they suck." Secondly, I agree an agent who sets up all visits and drafts all paperwork should get some money for their trouble, but this was me attempting to make an offer on a house I found myself at an open house. This was the first time I had spoken to this agent. Drafting the offer was filling in a few blanks on a standard form. On a side note, I'm pretty sure we're in the same market. The reason I picked any random agent was because I was making an offer on the day of a packed open house after not expecting to make offers this soon. Anyway, in case anyone cares, we made an offer with this agent for the asking price, but they went with another offer. Not surprised, it was very busy at the open house, and we heard several people discussing making offers, but I wasn't prepared to pay more than asking for the house.
|
|
#
?
Feb 15, 2017 16:53
|
|
|
Pryor on Fire posted:Banks make waaaaaay more money off of you paying your mortgage than they do foreclosing on a house, that's sort of the point of fractional reserve banking. There is zero incentive to foreclose except in some hokey unethical reverse mortgage situations. This is true, but the selfish idiot bank employees who are incentivized (is this a word?) to close loans don't give a crap about how much money their employer makes.
|
|
#
?
Feb 15, 2017 17:35
|
|
|
Leperflesh posted:10% annually in maintenance costs is way too high for a home that isn't so bad it's close to being condemned. 1-2% annually is a much more reasonable budget for a reasonably modern and decent condition house. You two might be talking about different numbers? Budgeting repair costs a percentage of the total property value is a waste of time since the proportion of the value of the land and improvements on it are not fixed. 10% of the value of the improvements is still high, but 1-2% seems way too low. The implication is a 50-100 year depreciation schedule on property improvements. Perhaps the truth is in the middle?
|
|
#
?
Feb 15, 2017 18:00
|
|
|
Grumpwagon posted:Couple of things. I PMed you. 
|
|
#
?
Feb 15, 2017 21:47
|
|
|
AreWeDrunkYet posted:You two might be talking about different numbers? Budgeting repair costs a percentage of the total property value is a waste of time since the proportion of the value of the land and improvements on it are not fixed. Yeah, I think actually a 50-100 year depreciation schedule on a reasonably well built house is actually quite reasonable. At the very least, I would expect the foundation and main structure to survive for 50+ years with no maintenance other than preventative (e.g., you're not allowing drainage problems to undermine your foundation, you're actively preventing termites from infesting the structure, etc.) which are generally quite cheap. I would hope that a house that cost $200k to build would not cost $200k (adjusted for inflation) to maintain and repair over a period of less than 50 years, anyway! That said, current and recent fads in construction in the US may imply a much higher rate of depreciation. Stupidly complex roofs, inadequate construction quality, appliances with intentional built-in obsolescence, etc. could halve the expected lifetime of a home. I agree with you that the maintenance costs should be compared to replacement value of the structure, not property value, but the whole point of my great big post was that there is no valid "rule of thumb" because of the huge differences between various homes in quality, environment, construction techniques, lot geology & hydrology, etc. etc. etc.
|
|
#
?
Feb 15, 2017 22:18
|
|
|
I went to a free redfin class to learn about mortgages. Proceeded to use them to buy a house. Everything's been smooth, agent literally doesn't give a poo poo if I buy or not. I've never felt pressured and I am getting back a check for $2500 once closing is done. Would recommend. If you don't want to use them, at least attend their free classes if you know jack poo poo about mortgages and the buying/selling process.
|
|
#
?
Feb 16, 2017 06:34
|
|
|
lol internet. posted:I went to a free redfin class to learn about mortgages. Proceeded to use them to buy a house. Everything's been smooth, agent literally doesn't give a poo poo if I buy or not. I've never felt pressured and I am getting back a check for $2500 once closing is done. We used redfin to buy our house as well and had an awesome experience with them. Our agent always answered any emails we sent her within what seemed like 15 minutes even on the weekends. I've purchased previous houses using a regular realtor before and I don't think I'll ever use them again.
|
|
#
?
Feb 16, 2017 13:36
|
|
|
EAT FASTER!!!!!! posted:Real estate agents are, largely, predictable, childish scum. Speaking as a real estate agent, you have no loving idea. The number of idiots in the business who have no idea what they're doing is breathtaking.
|
|
#
?
Feb 16, 2017 13:50
|
|
|
When I brought up my inspector choice to my agent last year (coworker recommended him, gave me his inspection report), he said "he's almost too thorough", which 100% solidified my choice. Do always get the most thorough annoying inspector you can.
|
|
#
?
Feb 16, 2017 16:23
|
|
|
Makes me think you should pretend to sell your house and ask a realtor for inspector recommendations or ones to avoid.
|
|
#
?
Feb 16, 2017 20:38
|
|
|
I am about to put in an offer on a house and I've reviewed the contract and there's like....nothing to red line here or anything that concerns me. As a first-time home buyer and someone who reads contracts for a living, this is extremely terrifying. What are some One Weird Tricks that brokers use to screw over millions of home buyers every day that I should be looking for and am most definitely missing here?
Mikey Purp fucked around with this message at 22:48 on Feb 16, 2017 |
|
#
?
Feb 16, 2017 22:42
|
|
|
Mikey Purp posted:I am about to put in an offer on a house and I've reviewed the contract and there's like....nothing to red line here or anything that concerns me. As a first-time home buyer and someone who reads contracts for a living, this is extremely terrifying. What are some One Weird Tricks that brokers use to screw over millions of home buyers every day that I should be looking for and am most definitely missing here? Purchase agreements are pretty simple. There may be some language that allows the agents to get paid even if the deal falls though, depending on what causes, and some specific language around the remedies for breach and what constitutes a breach. Look for weird poo poo in there. There might also be an "affiliated businesses" disclosure. Pay close attention to that and then keep that in mind as the deal progresses.
|
|
#
?
Feb 16, 2017 22:54
|
|
|
Mikey Purp posted:I am about to put in an offer on a house and I've reviewed the contract and there's like....nothing to red line here or anything that concerns me. As a first-time home buyer and someone who reads contracts for a living, this is extremely terrifying. What are some One Weird Tricks that brokers use to screw over millions of home buyers every day that I should be looking for and am most definitely missing here? It's the convergence of a zillion transactions + regulations. It's all become largely standardized. Even the "gently caress you" items are checkboxes like "can the principle balance go up? [ ] Yes [ ] No"
|
|
#
?
Feb 16, 2017 23:50
|
|
|
Mikey Purp posted:I am about to put in an offer on a house and I've reviewed the contract and there's like....nothing to red line here or anything that concerns me. As a first-time home buyer and someone who reads contracts for a living, this is extremely terrifying. What are some One Weird Tricks that brokers use to screw over millions of home buyers every day that I should be looking for and am most definitely missing here? There will be a checkbox about waiving your inspection or financing contingencies or for how many days they are for. Do not waive your financing contingency unless you are paying with cash. Do not waive your inspection contingency. If you do waive it and find out the ceiling is full of mold and the foundation is cracking you either have to buy the house or lose your earnest money. With the inspection contingency you can pretty much just walk away, or ask for a reduced price up until the inspection period is over. Don't be pressured to offer more than you want because, the house is getting a bunch of other offers, or to make a strong offer. If the sellers do not counter you paid too much. Be mindful of the closing costs split and any sellers credit.
|
|
#
?
Feb 17, 2017 00:47
|
|
|
lampey posted:There will be a checkbox about waiving your inspection or financing contingencies or for how many days they are for. Do not waive your financing contingency unless you are paying with cash. Do not waive your inspection contingency. If you do waive it and find out the ceiling is full of mold and the foundation is cracking you either have to buy the house or lose your earnest money. With the inspection contingency you can pretty much just walk away, or ask for a reduced price up until the inspection period is over. Don't be pressured to offer more than you want because, the house is getting a bunch of other offers, or to make a strong offer. If the sellers do not counter you paid too much. Be mindful of the closing costs split and any sellers credit. Even IF they say the house is getting multiple offers, they may not be honest about that. I've known agents that tried to pull that poo poo where they tell sellers it's a hot property when in fact it's been sitting on the market for 30 days and you're the first person to put an offer in.
|
|
#
?
Feb 17, 2017 18:47
|
|
|
Is there a reason not to put a large down payment on a house? If you could throw 50% down is there a financial reason not to?
|
|
#
?
Feb 20, 2017 09:45
|
|
|
particle9 posted:Is there a reason not to put a large down payment on a house? If you could throw 50% down is there a financial reason not to? Reason 1: Asset liquidity. All the money you put in as a down payment is unavailable to you until you sell the property or refinance, whereas other investments (Stocks, bonds, REITs) could be shifted easily if you needed the money for something else. Reason 2: Opportunity cost. At least in the US right now, mortgages are ridiculously cheap, barely outpacing inflation and in most cases tracking below inflation + appreciation. In theory, investing extra cash in something with a reasonable return would generate more money than you'd save over the course of the mortgage with a larger down payment. Reason 3: Asset diversification. Buying a home means you naturally have a larger--than-optimal exposure to your local real estate market's whims. A housing bubble burst or natural disaster puts all of that investment at risk. By spreading your money out as much as possible you take less of a hit if one sector drops more than the others. That said, it's a house and houses are best treated as an expense rather than an investment, so if the large down payment gives you an advantage you like, it's not the worst thing to do in the world.
|
|
#
?
Feb 20, 2017 10:20
|
|
|
We're currently kind of at a crossroads about that idea ourselves. We bought a house with 0% down, sparing ourselves PMI because of a special "physician loan" program 20% second mortgage, but the first mortgage is a 5/1 and the second mortgage is a 5 year interest only with a balloon payment. Fortunately, we have sufficient cash flow to pay off both mortgages in 3.5 years after we've maxed our tax advantaged retirement space and paid down non-forgivable loans. My question is... should we? On the one hand, I know the float on the ARM could prove really costly but on the other, I'm not sure I want to stay in the house longer than six or seven years. So is paying to refinance to a 15 or a 30 fixed once we've paid off the "second" mortgage worth it? Should we pay off the house, keep it, hire a property management company and take the cash flow from renting it? It's not a very strong rental market, unfortunately, chiefly because of a glut of new construction and cheap mortgages, but that might change in 5 years, when we could be renting out a paid-off house.
|
|
#
?
Feb 20, 2017 15:13
|
|
|
EAT FASTER!!!!!! posted:We're currently kind of at a crossroads about that idea ourselves. We bought a house with 0% down, sparing ourselves PMI because of a special "physician loan" program 20% second mortgage, but the first mortgage is a 5/1 and the second mortgage is a 5 year interest only with a balloon payment. You were not "spared" anything, your mortgage is not special or better because of your job, that's irrelevant. You just got taken advantage of and are stuck in a lovely arm mortgage like everyone else stuck in a lovely arm mortgage. Just so we're all on the same page as far as what is reality is. It's great that your income is so high it doesn't matter, but you still got hosed.
|
|
#
?
Feb 20, 2017 15:59
|
|
|
Pryor on Fire posted:You were not "spared" anything, your mortgage is not special or better because of your job, that's irrelevant. You just got taken advantage of and are stuck in a lovely arm mortgage like everyone else stuck in a lovely arm mortgage. Just so we're all on the same page as far as what is reality is. Actually, doctors do get special loans with potentially favorable rates and other considerations such as no-PMI. Turns out doctors are really good at not defaulting. http://whitecoatinvestor.com/personal-finance/the-doctor-mortgage-loan/
|
|
#
?
Feb 20, 2017 16:06
|
|
|
EAT FASTER!!!!!! posted:We're currently kind of at a crossroads about that idea ourselves. We bought a house with 0% down, sparing ourselves PMI because of a special "physician loan" program 20% second mortgage, but the first mortgage is a 5/1 and the second mortgage is a 5 year interest only with a balloon payment. I would nuke the balloon loan asap unless you have a lump sum sitting there in a CD or something to cover that call. You can re-fi for around $2500 all in, less if you pay exactly $0 for points. Cost of capital goes down in the future, but maybe look at it as though one of you might take a hit to your job for unknown reasons, where would you want to be? (As I recall you are two doctors married? Trump outlaws orthopedic surgeons(I don't know your specialty), medicare for all tanks your income, your spouse decides staying at home with the kids is better, whatever.) If you're willing to have a property management company rent it out for you, and your current value of capital seems pretty low, why not put it on a 15 or 30-year fixed mortgage with 50% "down" to keep the payment low? This puts a fixed cost in your budget where if the rental market tanks for a few years you can simply ride out the low payments. Figure out a payment where a 25% lowered rental market still covers your mortgage in 9-10 months of payments. This should also help you buy a future home without having that much mortgage debt on your books. Personally what worked for us was doing a fee-for-service financial planning session where we outlined some goals, brought in all of our financial info, and had them build a model to reach those goals. We brought in bank account balances, income statements, debt information, everything, in a pile. They also pitched us managed investments at "1% of assets managed, down to 0.5% at $XMM" - and seeing one or more doctors walk in you are going to get this pressure HARD. Do not fall for it. The plan that came out was shockingly simple to follow.
|
|
#
?
Feb 20, 2017 17:22
|
|
|
Pryor on Fire posted:You were not "spared" anything, your mortgage is not special or better because of your job, that's irrelevant. You just got taken advantage of and are stuck in a lovely arm mortgage like everyone else stuck in a lovely arm mortgage. Just so we're all on the same page as far as what is reality is. Plainly untrue, but thanks for your insight and addressing literally zero of the questions I posed.
|
|
#
?
Feb 20, 2017 17:44
|
|
|
H110Hawk posted:I would nuke the balloon loan asap unless you have a lump sum sitting there in a CD or something to cover that call. You can re-fi for around $2500 all in, less if you pay exactly $0 for points. Cost of capital goes down in the future, but maybe look at it as though one of you might take a hit to your job for unknown reasons, where would you want to be? (As I recall you are two doctors married? Trump outlaws orthopedic surgeons(I don't know your specialty), medicare for all tanks your income, your spouse decides staying at home with the kids is better, whatever.) Yeah our plan is to pay the balloon in the next 8-12 months. If either of us got fired we would still comfortably cover our mortgage and that would tip us toward refinancing I think. You don't really need to know our specialties except to say we are about as protected from market forces in healthcare as two human beings can be. I like the sound of the second paragraph here, but sort of dislike the idea in the third paragraph. I guess my question was a little vague, I know it's not good to treat your house like a big wooden savings account but - short of getting geared down by having it paid in full, I don't see a lot of opportunities outside our tax advantaged space I would rather put money than home prices in our market, and paying off our mortgage gives us a better margin on that equity, right?
|
|
#
?
Feb 20, 2017 17:50
|
|
|
EAT FASTER!!!!!! posted:Yeah our plan is to pay the balloon in the next 8-12 months. If either of us got fired we would still comfortably cover our mortgage and that would tip us toward refinancing I think. You don't really need to know our specialties except to say we are about as protected from market forces in healthcare as two human beings can be. I don't care what your specialties are, I tried to pick something ubiquitous as an example where you don't really have many truly optional procedures. (Plastic & Derm compared to Ortho/Cardio/Pulmonary/OB or heck GP/internal med.) Getting to a point of comfortable leverage in a down market means never having to do anything you don't love. You don't really state any goals in your life other than how to structure your current debt. Fixed rate > ARM, I would pay $2500 for that certainty. I assume you're pulling in $25k-50k/month (300-600k/year) of household income? Do you intend to send your kids to private K-12? Travel the world? Pay for college? Retire at 50? I can't imagine the stress of become a doctor turning into the hilarious income with different stress, but you are actually allowed to sleep. I think the answers to a lot of these questions will fill in what you should do with the growing pile of money you have. Diversify! Do you have any smart friends who aren't doctors? Ones who understand how money works? Form some shell corps and buy income property. You will need an attorney to do some substantial work here to make sure everything is setup correctly. (You become an S-Corp which owns a % of an LLC/REIT which owns a LLC-per-property? I don't know! Ask an attorney who specializes in it or an accountant to lay it out so an attorney can draft it. No stalemate potential in voting rights is important.) Get your personal leverage way down then split up your remaining free capital 1/3 taxable brokerage in index funds, 1/3 into the property trust, 1/3 into... unleveraged horseboats? I'm defining free capital as money leftover after debt payment (student, mortgage, retirement.) The unleveraged part is important as you will have a lot of leverage in the property trust and your own debt payments. Maybe if you only have smart with money doctor friends, buy a medical building in the trust? Even if you rent to yourself it should all go through proper accounting in the corporate structures. Third paragraph was just a personal anecdote. Feel free to ignore it or follow it just don't pay someone 0.5-1.0% to manage your money. For us we wind up saving money into the horseboat bucket and when it hits a threshold for something we want, we do it. Right now we're working on getting together $25k to do a major bathroom renovation. We have hilariously less free capital than you do, so take it for what you will. We have a mortgage and a car payment.
|
|
#
?
Feb 20, 2017 19:21
|
|
|
EAT FASTER!!!!!! posted:Plainly untrue, but thanks for your insight and addressing literally zero of the questions I posed. I don't know anything about "physician loans" but getting a second loan to cover the down payment is pretty common and comes in a variety of packages (80-20, 80-10-10, etc). Your lender will tell you that you're saving yourself from having to pay PMI but what they're not telling you is that the second loan costs as much as or more than PMI would have. Hypothetically you can still come out ahead if A) your state lets you deduct interest but not PMI expenses and/or B) your federal AGI is over $109k/year, since you can't deduct PMI anymore once you hit that point, so it's possible that you didn't get shafted but it's also just as likely that you did. But whereas PMI legally must be dropped once you're at 78% LTV (and some banks will drop it at 80% or even 85% if you ask very nicely), the interest-only ARM loan that you were sold can sit there indefinitely if you're not proactive about paying it down, so the potential gain for the lender is actually much higher than normal. So yeah, it's a reasonably good deal for you only if you're proactive with your finances, but enough physicians are lazy to make these kinds of favorable initial terms profitable in the long-run, so all that you have to do is not be lazy about paying down your interest-only loan and getting out of the ARM 5/1 before the interest rate starts rising. In terms of ARM 5/1 vs Traditional 30-year, this is another layer of the con. The lender is hoping that you don't bother refinancing (because the ARM payments are so low and refinancing is expensive) and that you don't bother paying it off within 5 years. But like with the interest-only loan, you just have to be proactive and either pay down the ARM or refinance. Unfortunately you're paying down a low-interest loan alongside a stably-growing market, so you're paying a significant opportunity cost if you pay down the loan within 5 years. Refinancing means you'll have more liquidity over time, and thus more earning potential, but refinancing costs money, and you'll probably wind up talking to the same lender who sold you the ARM in the first place. So yeah I think the other guy describing this is a "con" is probably accurate but he probably didn't need to be so salty about it. tl;dr I think you should pay down the interest-only loan first and then the ARM as soon as you are able, ARMs suck and interest-only loans especially suck. If you don't want to do that then definitely refinance to a traditional note once it looks like you have >20% equity; refinancing costs money, but leaves you more liquid, but it's not clear whether or not this is an advantage in your situation
|
|
#
?
Feb 20, 2017 22:45
|
|
|
Welp, the clothes washer died today. Guess I get to find out if the Home Warranty the sellers included is a scam or not.
|
|
#
?
Feb 21, 2017 03:44
|
|
|
It's probably not a scam, but probably has a $100 payout limit for a washer and $500 deductible or something.
|
|
#
?
Feb 21, 2017 06:36
|
|
|
Thoguh posted:Welp, the clothes washer died today. Guess I get to find out if the Home Warranty the sellers included is a scam or not. Goondolences Oh wait, it's just an appliance.
|
|
#
?
Feb 21, 2017 08:19
|
|
|
That's a $1200 fee max. You'll be ok.
|
|
#
?
Feb 21, 2017 08:33
|
|
|
QuarkJets posted:tl;dr I think you should pay down the interest-only loan first and then the ARM as soon as you are able, ARMs suck and interest-only loans especially suck. If you don't want to do that then definitely refinance to a traditional note once it looks like you have >20% equity; refinancing costs money, but leaves you more liquid, but it's not clear whether or not this is an advantage in your situation I agree with the first bit, I just don't know what I would do with the "added liquidity." We max our tax advantaged space every year already, but I guess I could just refi onto a 15 year fixed.
|
|
#
?
Feb 21, 2017 14:47
|
|
|
|
| # ? May 29, 2024 05:23 |
|
|
Thoguh posted:Welp, the clothes washer died today. Guess I get to find out if the Home Warranty the sellers included is a scam or not. Warning, there are versions of the home warranty that don't include washer and dryer because they die so readily.
|
|
#
?
Feb 21, 2017 14:47
|
|