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Is using a dual agent something that's doable as long as I keep my head, or should I absolutely insist on bringing a second realtor into the mix? I know it's legal in my state, but I also know there are lots of good reasons some states ban it. The one I've been using for months now and I've found real useful and obliging has a house she wants to show me before it hits the market. I haven't seen anything but the exterior yet, but what info I have so far hits most of my checklist, it's in one of the two areas I'd already been focusing on, the mechanicals are all relatively new, and it's well within my budget. However, I am a first time home owner, and I won't know how much I should truly be discounting the price for a steep yard and a dated interior (don't know how badly dated yet). If I ask for comps, assess them thoroughly, go through the full inspection process, and the appraisal is adequate, is there really all that much room for me to be screwed over even if she was so inclined? In case it matters, the local market has most desirable houses receive offers within a week of listing for close to the asking price.
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Apr 10, 2018 04:01
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Mandalay posted:My opinion is that the freeway noise is going to bother you more than living across from an apartment complex. That Mueller redevelopment area nearby is great in terms of appreciation but might also increase traffic on that arterial road quite a bit. Traffic noise was almost non-existent when I checked out the house. Granted it was Sunday, but the realtor pointed out that putting in modern windows would make the house itself nearly impervious to traffic noise. The backyard is also facing away from the highway and offers quite a bit of privacy from what I've seen. Anyways, I decided the location doesn't quite work for me. I'll wait to see if the price goes down a bit and re-evaluate.
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Apr 10, 2018 04:05
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PurpleLizardWizard posted:Is using a dual agent something that's doable as long as I keep my head, or should I absolutely insist on bringing a second realtor into the mix? I know it's legal in my state, but I also know there are lots of good reasons some states ban it. The value in an agent is having someone who will represent your interests, adversarially if necessary, in what is likely to be the most substantial financial transaction in your life. Real estate transactions are complicated and have a lot of opportunities for the buyer to get hosed, and not just by the seller. A dual agent is basically less of an adversarial representative and more of a mediator whose motivations are primarily to close as many transactions in a given window of time as is possible. I don't really think it's ever a good idea, but if you've never bought a home before and don't know what your risk factors are, it's definitely a bad idea.
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Apr 10, 2018 14:17
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A house purchase is the most expensive process you've ever gone through and is one of the most complicated, too. It's better to have two people work it out than one. Of course your agent will still prefer to close the deal quickly and will also make more money if you spend more money, so be aware of that pressure. They're still obligated to do what you say, at least. Also start trying to find your own inspector.
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Apr 10, 2018 14:37
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enraged_camel posted:Traffic noise was almost non-existent when I checked out the house. Granted it was Sunday, but the realtor pointed out that putting in modern windows would make the house itself nearly impervious to traffic noise. The backyard is also facing away from the highway and offers quite a bit of privacy from what I've seen. You learned absolutely nothing about the traffic noise situation going there on a Sunday
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Apr 10, 2018 15:00
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Eric the Mauve posted:You learned absolutely nothing about the traffic noise situation going there on a Sunday I went again yesterday midday and it was the same.  I think it’s because 290 isn’t a major highway, unlike the other two in that vicinity.
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Apr 10, 2018 16:48
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Isn’t most traffic in the morning and evening? What will it sound like over breakfast and dinner?
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Apr 10, 2018 16:50
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Eric the Mauve posted:You learned absolutely nothing about the traffic noise situation going there on a Sunday And the realtor promising that new windows would fix any problems is a bald faced lie meant to get you to buy the house.
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Apr 10, 2018 16:52
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HEY NONG MAN posted:And the realtor promising that new windows would fix any problems is a bald faced lie meant to get you to buy the house. She actually voiced a lot of other concerns and suggested it may be a bit overpriced. She’s good.
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Apr 10, 2018 16:53
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Can we take a minute to talk about the various ways have people put together down payments? I just recently changed jobs, and got a pretty significant raise. I could easily manage a mortgage payment, et al, but coming up with 5 digits of liquid currency is a bit of a ways off, after restocking my emergency fund, etc. Do you just save your pennies? Or is there a program that can be taken advantage of?
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Apr 10, 2018 17:12
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My wife and I did not have much in terms of down payment, with the interention of buying a house with an accessory apartment to offset the mortgage. Due to this we knew we could carry a larger mortgage with PMI (plus our house was only 2x our gross income) and that allowed us to only need a down payment of 3.5% With that said, we were able to use NY SONYMA program to get a 15k grant from the state that goes away in 10 years. We also had the seller give us 16k in concessions. Our total closing costs were 45k so we ended up 14k out of pocket not including inspection fees. Sepist fucked around with this message at 17:19 on Apr 10, 2018 |
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Apr 10, 2018 17:16
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I guess some more context would have been important, though I didn't want to veer into BFC Finance Thread territory. I'm looking in the Orlando, FL area, and haven't really come up with a price, it's just that my expectation was to have to put anywhere between 10 and 30k down, depending. That seemed realistic, but I could be mistaken there too. My gross income is just below six figures, but my current industry is somewhat volatile, so I've been trying to be cautious.
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Apr 10, 2018 17:18
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You're options are 20% down conventional mortgage or finding a bank that does less than 20% without PMI (unlikely after the crash) or FHA loan which is 3.5% down but the loan carries PMI for its life which makes them generally undesirable. You can refinance a FHA loan into conventional once your LOan to Value is under 80% and remove PMI but you will be paying that for years
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Apr 10, 2018 17:20
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Deviant posted:Can we take a minute to talk about the various ways have people put together down payments?
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Apr 10, 2018 17:20
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Sepist posted:You're options are 20% down conventional mortgage or finding a bank that does less than 20% without PMI (unlikely after the crash) or FHA loan which is 3.5% down but the loan carries PMI for its life which makes them generally undesirable. You can refinance a FHA loan into conventional once your LOan to Value is under 80% and remove PMI but you will be paying that for years Yeah, based on the median home value (178K) here, i'd need to throw 35k at a down payment, which isn't an unsavable amount, but it's not like I can stand up right now and pull it out of my butt. Does my credit score being 800+ benefit me at all here? SiGmA_X posted:I take advantage of a savings account. If you'll be saving for ~5-10yrs you could use VTSAX or similar. Good news is if you keep your expenditures in line with before, or lower, you can save more with your raise. Don't let expense creep happen. Pretend you never get raises. This is what I've been doing, I was living below my means before this raise, and it was a pretty significant raise as i mentioned, so the money is largely found. I bumped up my 401k and am in the process of re-establishing savings, etc. I just wasn't sure if there was something to be aware of besides "save money, stupid."
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Apr 10, 2018 17:22
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If you are a veteran the VA has a great program. FHA, homepath, USDA, home ready home possible, and conventional 5% or 3%, and piggyback loans are all other options depending on your credit. There are state and local programs for first time home buyers in many areas. If you are a member of a certain unions or professions like a teacher or doctor there are additional down payment options.
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Apr 10, 2018 17:25
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lampey posted:If you are a veteran the VA has a great program. FHA, homepath, USDA, home ready home possible, and conventional 5% or 3%, and piggyback loans are all other options depending on your credit. There are state and local programs for first time home buyers in many areas. If you are a member of a certain unions or professions like a teacher or doctor there are additional down payment options. Sadly I'm not a veteran, and I just work in the tech industry, but I can look into some of these other options. My credit is pretty outstanding, and I was hoping to leverage that if possible. Can you tell me more about some of these other programs? I can go google, but the results are a mixed bag.
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Apr 10, 2018 17:28
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Check to see if your city or state offers home-buying classes. They do those here and they not only go over the whole process and provide a lot of guidance and information, they let you know what sort of programs are available and if there is anything in particular for first-time buyers, etc, that you might not have heard about.
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Apr 10, 2018 17:31
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You can likely search "Down Payment Assistance" + location/industry/etc, but for the most part the options have been laid out for you. FHA loans require less but carry PMI for the life of the loan, conventional loans can be approved with less than 20% down, but you will pay PMI or take a slightly higher rate for Lender paid PMI. Conventional loans do not carry PMI for the life of the loan and lenders may let you cancel PMI under a variety of circumstances after the loan has closed (Values go up in the area or you make a large payment and the loan is recast).
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Apr 10, 2018 17:31
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Deviant posted:Can we take a minute to talk about the various ways have people put together down payments? You save your nickels and dimes too. FHA lets you put as little as 3.5% but has some extraordinarily high fees associated with it these days thanks to the banks loving everything up. PMI no longer falls off at 20% LTV and you have to prepay a bunch of it. It will get you into a house, but it will cost you a pretty significant chunk of change. 95-100% Financing through stacked loans. Arguably a worse idea than FHA. This is something like an "80/20" loan where you have two mortgages on your house, one of them at likely a much higher rate. 10%-19% down + PMI - Now you're into conforming territory, especially in Orlando. You pay PMI until the value of the house is 20% of your total loaned amount. This is either through paying down principal (regular on time payments, extra principal payments, or both) or the house appreciating. They remove PMI by request at 80% LTV and by law automatically at ~78%. 20+% down: normal loan. Same as above but without the pmi and potentially a tiny fraction of a better rate. All of these have thousands of dollars in fees that are on top of your down payment. Shop around. Plus a thousand per house in inspections depending on what is found or what is needed (general, roof, sewer, foundation.) Get "buyers" title insurance.
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Apr 10, 2018 17:31
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What is your motivation for buying a home now instead of in the year or two it would take you to save up that down payment? I bought a house with about 3% down on a Maryland HUD program and in retrospect wish I had continued renting and bought with 20% down.
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Apr 10, 2018 17:38
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Deviant posted:Yeah, based on the median home value (178K) here, i'd need to throw 35k at a down payment, which isn't an unsavable amount, but it's not like I can stand up right now and pull it out of my butt. Does my credit score being 800+ benefit me at all here? Where in orlando are you looking to spend 178k. That's, not going to be in a very nice neighborhood if you're talking within the city of Orlando. I'm 30 minutes east of Orlando if you have any questions about areas. Or if you're already living here and know where you want to live you can ignore me lol
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Apr 10, 2018 17:38
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Dwight Eisenhower posted:What is your motivation for buying a home now instead of in the year or two it would take you to save up that down payment? My motivation isn't to buy now, I'm just researching the process. mattfl posted:Where in orlando are you looking to spend 178k. That's, not going to be in a very nice neighborhood if you're talking within the city of Orlando. I'm 30 minutes east of Orlando if you have any questions about areas. Or if you're already living here and know where you want to live you can ignore me lol This is also a factor. It was really just an exploratory question, I'll be renting for another year minimum, but nothing was ever made worse by early investigation. Still, thanks for the notes all.
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Apr 10, 2018 17:44
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Deviant posted:My motivation isn't to buy now, I'm just researching the process. Great, this is a good answer, and it's good to hear you're not in a rush and are trying to get smart about this from very early in the process. Remember that any amount of money you defer putting in your down payment will still be paid to purchase the house, with interest on top of it. Before you're in the house is the perfect time to get in the habit of saving money. It'll give you the down payment to get a conventional loan, and it'll also put you in a position to continue saving money for maintenance and repairs on the home, which are substantial. If you haven't saved up for an expensive repair and it hits, you'll end up needing to finance that as well, which turns into you putting a lot of money into financiers' pockets and less into your own. There's tax advantages to owning over renting: you can deduct your mortgage interest and frequently deduct your property taxes. However you also will have to pay that mortgage interest and property tax yourself, and you get exposure to the aforementioned risks around damage to your abode, as well as the risk that your local real estate market tanks. Taxed money in your pocket is still worth more than mortgage interest you paid some bank.
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Apr 10, 2018 19:44
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Dwight Eisenhower posted:Great, this is a good answer, and it's good to hear you're not in a rush and are trying to get smart about this from very early in the process. A larger down payment (i.e. larger than 20%) also makes your bid more attractive in competitive scenarios, right? Or is that only for all-cash offers?
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Apr 10, 2018 19:54
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The mortgage interest deduction won't matter starting in 2018 for many more buyers, because the standard deduction will be $12,000 for individuals, $18,000 for heads of household, and $24,000 for married couples filing jointly and surviving spouses. That's a lot more than the interest on a $200k mortgage, so you'd need a lot more deductions to pile on there before it makes sense to itemize anymore. For Deviant's price range, if he's buying alone, $12k is about the interest of the first 12 months of a $265k loan assuming 4.5% interest. So an individual needs to have a mortgage larger than that to make the interest worth deducting, on its own without considering any other possible itemized deductions. I think he said he was looking at $175k, and at that price, especially with a 30% down payment, it's unlikely he'll have enough other deductions to make it worth itemizing. For a married couple, that number jumps to about $535k of loan at 4.5%. Deducting your property taxes obviously should be added in, you may also have charitable donations, deductible business expenses, etc. etc. etc. so look at an amortization table and consider your other deductions too. Naturally if you're itemizing just to deduct slightly more than the standard deduction, you're talking about fairly small tax savings anyway, so it's not like there's a magic threshhold where suddenly you're saving tons of tax money because of your deductible interest. Leperflesh fucked around with this message at 20:00 on Apr 10, 2018 |
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Apr 10, 2018 19:58
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enraged_camel posted:A larger down payment (i.e. larger than 20%) also makes your bid more attractive in competitive scenarios, right? Or is that only for all-cash offers? I don't know that the amount of the down payment makes much difference in a bidding war. The only thing I've ever heard from my realtor is that people will almost always choose a non-FHA loan over an FHA loan due to the extra crap that comes along with FHA loans. Of course cash offers usually beat out everything else since you aren't adding financing contingency in the contract, and you may even be able to get away with no inspection contingencies as well.
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Apr 10, 2018 20:00
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enraged_camel posted:A larger down payment (i.e. larger than 20%) also makes your bid more attractive in competitive scenarios, right? Or is that only for all-cash offers? Think about this from a seller's perspective: are you going to see the terms of the loan the person buying your home is using to provide you the big check of money, or are you just getting a big check while having to agree to let the person off the hook and return their earnest money if they can't secure financing? The benefit of all cash offers is that the buyer is saying they can buy it outright and there's no risk of their mortgage falling through or the bank they're working with failing to properly execute before closing. A 20% down vs. 30% down offer provides the seller nothing, that's purely about the relationship between the buyer and whatever lender is providing the cash to meet your agreed sale price.
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Apr 10, 2018 20:05
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DJCobol posted:I don't know that the amount of the down payment makes much difference in a bidding war. The only thing I've ever heard from my realtor is that people will almost always choose a non-FHA loan over an FHA loan due to the extra crap that comes along with FHA loans. Of course cash offers usually beat out everything else since you aren't adding financing contingency in the contract, and you may even be able to get away with no inspection contingencies as well.
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Apr 10, 2018 20:06
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Dwight Eisenhower posted:Think about this from a seller's perspective: are you going to see the terms of the loan the person buying your home is using to provide you the big check of money, or are you just getting a big check while having to agree to let the person off the hook and return their earnest money if they can't secure financing? Right, that's actually what I thought, but I think I read some incorrect info somewhere about the size of the downpayment mattering and it made zero sense. Thanks for confirming.
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Apr 10, 2018 20:12
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enraged_camel posted:I found a house that I like, but it has two issues: Oh poo poo, that's the other part of my mom's street! --Hrm. If I remember right, that's the cutthrough people use to get from 290 access to Berkman (which is stupid). It sucks. Cars are CONSTANTLY parked up and down the street making it extremely narrow. This right here is what would annoy the poo poo out of me. --In that area, I don't think an apartment complex is going to scare all buyers off. Do you care about living in the house now or more about selling later? Not trying to be snarky, I just had to make myself think that way when I was doing upgrades and whatnot to my place. --You can always hire a yard person/service if you don't want to maintain it yourself. I pay a service that mows and edges. That's it. Fairly cheap. But with that yard, you can do soooo much. Or soooo little if you care to.  --1 car garage: highly possible it was a carport in previous years. I'd get that checked out. --You're not gonna hear the drat freeway, FFS, it's not that goddamn close. But get used to hearing the sirens from the firehouse right down the street. For me, the narrow street from all the street parking would turn me off only because I know the area and forget and drive down the street right as church was letting out and regretted every minute of it.
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Apr 10, 2018 20:25
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enraged_camel posted:I went again yesterday midday and it was the same. Fair enough. I was skeptical because our house is a similar distance from a freeway and we can hear it with every window closed, and with modern, double-paned windows. Then I looked at Annual Average Daily Traffic (AADT) numbers and found yours was 30k (US-290 bet US-183 and FM-3177) and mine was 290k.... SiGmA_X posted:I read some BS on either Redfin or Zillow from local agents who said bigger downpayment = more attractive. My agent said what you said - conventional/jumvo at 10% or >20% = all equal, VA and FHA being different. Well, all things being equal, I suspect it's easier for someone to get an affordable loan at 30% down than 5% down. When going through the underwriting process, I believe we were able to get some requirements waived by putting in more money down, and certainly our mortgage rate went down. This meant there was less of a chance of the deal falling through. Certainly not night and day in terms of 100% down but it was something.
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Apr 10, 2018 20:31
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Mandalay posted:Well, all things being equal, I suspect it's easier for someone to get an affordable loan at 30% down than 5% down. When going through the underwriting process, I believe we were able to get some requirements waived by putting in more money down, and certainly our mortgage rate went down. This meant there was less of a chance of the deal falling through. Certainly not night and day in terms of 100% down but it was something.
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Apr 10, 2018 20:35
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The difference, if any, would likely come from the seller's realtor letting the sellers know it is more likely the loan will close. Mileage would vary quite a bit on that, but I am guessing if everything else is equal, people would expect a loan to close more often/faster if you were putting a larger percentage down. Between differing conventional loans that is, the difference between FHA/VA and conventional would likely be explained to sellers more often, given the inspection differences.
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Apr 10, 2018 20:39
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DJCobol posted:You may be right. I'm thinking back to when I sold my house though, and on the offer sheet and back and forth negotiation that I did, nowhere did I know the amount that the buyer was putting down (80/20, 80/10/10, etc). I just saw conventional/non-FHA. Maybe that's not common though since my experience so far is selling 1 house. The loan contingency on our standard California realtors purchase agreement stated that the purchase was contingent on us getting a loan of x dollars at y rate. X dollars divided by Z purchase price would yield the LTV and this reveal the amount of down payment.
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Apr 10, 2018 21:16
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Bah, you guys are right on the dual agency. I did some more reading, and it looks like she'd be barred from giving me pretty much any advice at all. I probably wouldn't screw it up that bad, and she hasn't been pressuring me to the upper end of my budget so I don't think she's shady, but it's going to be a whole lot more peace of mind for me to have real advice available. Guess if I like the house I'll be seeing if I get to call dibs on her because I've been working with her longer, or if she's already locked into being the sellers' agent. If the latter, she'll know that this house is waaaaay below budget for me, but she'll also know that I'm under no pressure to buy soon, so hopefully that'll even out.
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Apr 11, 2018 00:37
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PurpleLizardWizard posted:Bah, you guys are right on the dual agency. I did some more reading, and it looks like she'd be barred from giving me pretty much any advice at all. I probably wouldn't screw it up that bad, and she hasn't been pressuring me to the upper end of my budget so I don't think she's shady, but it's going to be a whole lot more peace of mind for me to have real advice available. The seller is who is paying the agent, so you the buyer would need to find a new person. You could enlist a real estate attorney to help you out.
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Apr 11, 2018 00:54
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Whoa a house down the street from me just sold for $200k over the asking price. 
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Apr 11, 2018 16:52
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HEY NONG MAN posted:Whoa a house down the street from me just sold for $200k over the asking price. Time to list and move to Iowa.
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Apr 11, 2018 17:02
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At this point I could sell and move to the deep burbs and buy a mansion but I’m not really interested in that kind of lifestyle of commute. Instead what I can look forward to is another $1,000 increase in my yearly property taxes.
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Apr 11, 2018 17:12
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