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Elephanthead posted:The fix to bring to code those stair would be losing 10 square feet of floor on the main floor that is why they opted for death stairs. Get protected I’m sure there’s a fix that involves not having a double door open up to that. Either way, I won’t miss a little bit of space in exchange for not dying horribly on my way to get the laundry.
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May 14, 2022 21:44
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It's very common for homes to receive little or no maintenance, only repairing absolute emergencies, and you expect people to install handrails? Voluntarily??? When they could be using that money to buy more Amway products?????
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May 14, 2022 21:54
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I'm trying to decide whether I should offer on a place... It's ~50,000 under priced for where it is, but it has some fixes it needs. Simple ones are refinishing the floors and painting, water heater is at end of life, new kitchen appliances are probably necessary... but there is also knob and tube in the hallway / 1 room on the second floor, and there was standing water on the roof and our realtor said we would probably have to have the roof redone to level it out properly and let it drain. And a really weird third floor setup that we would probably w ant to adjust at some point. My understanding is that knob and tube makes it harder to get insured, more expensive to fix problems, and should probably be pulled out ASAP, so all together it seems like a lot of work. But it's on a wonderful block, a short walk to work for my partner, half a block to a great park, and best of all... It's been on the market a couple days and has no offers yet. It doesn't really show well, but it seems to have good bones and I think it's an ok deal, and we should have the cash reserves to make the repairs unless I lose my job, which is unlikely. It's been owned by the same people for 12 years, which is also nice - it's not a quick flip, it's definitely been well lived in, and is overall in ok condition (lots of surface blemish's, paint on the floor, etc etc, but underneath it has good character) Is any amount of knob and tube just a total dealbreaker?
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May 15, 2022 02:41
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My understanding is that knob and tube is just fine if you don't disturb it. Basically, don't wake the dragon up, ever. Do not connect new wiring to it, do not blow in insulation, leave it the hell alone. My house has some knob and tube and the insurer didn't care.
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May 15, 2022 02:57
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Thom Yorke raps posted:Is any amount of knob and tube just a total dealbreaker? Nope. Double check with some insurance agents to be sure. It's a downside but not a dealbreaker so long as you can get insurance coverage
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May 15, 2022 03:05
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The way I look at it is that knob and tube hasn't been in vogue since . . . well, a long time. Clearly, the stuff currently installed has been good enough that there haven't been any issues yet. Not a bad idea to think about how you're gonna handle it when the time comes, but if it doesn't look to be in bad condition, it's not an emergency. . . . at least, that's the stance I took with the aluminum wiring that was in the house I lived in for 12 years with no issues.
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May 15, 2022 03:22
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Hi. Long time reader, I have some home buying questions. I have never bought a house before and am planning way too far ahead. The numbers below are rounded and approximate. I am changing jobs and moving in a couple months from an area where I would never want to buy a house to an area I would. The earliest I would be looking to buy is November, but I can rent for a bit if nothing good is available. My employment should be fairly recession resistant (government funded science) and even if something goes bad, I can always get a remote job doing computer things and probably get a raise at the same time. Assets Current Salary: $90k, traditional pension New Salary: $150k, not counting benefits or bonuses Savings: $90k 401k, $20k Traditional IRA, $15k Roth IRA, $10k HSA, $30k Taxable Investments (Vanguard ETFs and some collectibles), $5k 529, $10k Emergency Fund in I Bonds, and $1-5k in a checking account. My current job will have to pay out my vacation and pension and my new job has a signing bonus. This comes to about $15k from the pension to a Roth IRA and $15k taxable, after tax. If I left the pension, it would not be inflation adjusted in 30 years when I could qualify, so I am definitely transferring it. Expenses Annual Budget: $36k, guessing high and budgeting in renting a small house in the new area. Student Loan: $40k This should be forgiven through PSLF in 2028. No other debt, I pay my credit card in full every month, 800+ Credit Score. Market The new job is in a LCOL city near family where I have lived before, I am very familiar with the area. The average home price by neighborhood quality is: $150k for acceptable: Biking distance to work or downtown, enough space for a dog to run around. $250k for good: A couple acres of land, biking distance to work, and near trails. $450k for best: Top 5 school districts in the state, top 50 nationally, where the mansions are. Questions 0. How are student loans factored into qualifying? My minimum student loan payment is small (~$325 per month) and I don't want to pay more than the minimum, to maximize the amount forgiven. My 529 plan currently covers at least 15 months of payments and I plan to pay the last 30 out of it, would that matter to lenders? 1. How long should I be at the new job before I take out a mortgage? 2. Is there some level of DTI where I don't need to worry about a home down payment? I can look right now and find homes that will cost less than my yearly after tax salary. I would guess that if I had $50k in taxable investments, $150k in retirement savings and make $150k, there would be some way to buy a $90k house without needing to put down much, but maybe that situation is too niche. 3. How do stock investments count in mortgage lending? Do they look at the dividends and count it as income? How does it combine with W-2 Income, since someone with two sources of income should be less risky than someone with one? 4. If I plow money into my brokerage, could I borrow against it for a down payment? Money is fungible, so it shouldn't matter that much if you have $300k in assets and $150k in mortgage debt, $300k in assets, $120k in mortgage debt and $30k in margin debt, or $270k in assets and $120k in mortgage debt, but I have a feeling that the real estate industry disagrees. For an example, say I have $50k in stock index etfs. If I sell $10k worth of box spreads against the portfolio to fund a 5% down payment, how would that look to a mortgage lender? I would never want to borrow more than 25% of portfolio value, so the market would have to fall 50% to receive a margin call. 5. Are there any compelling reasons for me to touch my retirement money to buy a house? 6. Are there good, non I-Bond investments to stick my $15k job transition money in that I could use as a home down payment but not lose to inflation?
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May 15, 2022 04:20
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BigPaddy posted:UK mortgages are fun since the longest fixed rate you can buy is 10 years then it becomes variable. You can refinance but that is dependent on the market not being poo poo. You could take a tracker or a capped rate which is basically variable or variable with a range. It is just very convoluted for no reason. So perfect for Britain. My other favorite British-ism with real estate is rent being due on English Quarters. Rather than the last day of every third month, it's on the feast of saint so and so on the 20somethingth of every third month.
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May 15, 2022 04:42
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pointlesspart posted:Hi. Long time reader, I have some home buying questions. I have never bought a house before and am planning way too far ahead. The numbers below are rounded and approximate. Only answering the ones I have any knowledge about : 1. This doesn't really matter because even your former income is plenty for a mortgage on a 450k house, but you might avoid questions from the underwriter by being able to provide 2 paystubs at your new income. Having the prior 2 months of bank statements include only income from your new employer could also be good. This is totally optional though. 2. It's very rare that you can get a mortgage with no money down, so the real question is "how much do I need to have". If you have good credit then just about any lender would be happy to give you a high-DTV mortgage while charging you PMI - anywhere between 3% and 20% down are easy to find options for conventional loans; all will charge you PMI but the rates aren't so bad. FHA loans are also an option. Assuming a $450k purchase price, 5% down would be $22.5k, and then you'd have closing costs on top of that - based on your taxable investments alone you'd be able to afford this, therefore all of the lower-cost options are also on the table. USDA offers 0%-down loans if you're buying in a rural area, but you almost certainly exceed the income limits of these loans; you could always check, though. 3. Hypothetically yes, dividends and interest count as income; your lender will want to see your prior 2 years of tax returns, and those will show up there. Lenders place way more importance on consistent income, so if you have a low salary but huge bonuses then that can be a problem for them. Similarly, if stock investments are a sizable portion of your income then a lender isn't going to like that. But a $90k or $150k stable-income salary should be fine for the price range you're looking at, so any investment income on top of that is just gravy. Request a pre-qualification letter from some lenders, they will tell you how much they're willing to lend you based on whatever numbers you give them. 5. You shouldn't touch your retirement money to buy a house, it's a bad idea for reasons that you probably already understand. PMI is low enough that, at your income, you can probably do fine just going high LTV and not touching your retirement or emergency assets. If you absolutely must touch retirement money for a down payment + closing costs, a 401k loan is the best option because you're borrowing from yourself - you're losing out on any gains that money would have made until you pay it back, but nothing more. Withdrawing from a Roth is a way worse option because you can never put it back in.
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May 15, 2022 05:05
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My agent is out of the office because his father died, and someone else is filling in. We're making an offer today, and the new guy sent me a buyers agent contract that says it lasts for three months. I pushed back on this, because it seems unnecessary, and the last offer we put in, our agent set the end date for that contract to be a week from the offer date, and it was no problem. The new agent said "So if we make the end of agency one week, we would not be able to represent you after that date. If your closing date is 35 days, you would then be unrepresented." which seems... untrue to me, since it was no problem before. Am I right to ask that the contract not last longer than a week?
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May 15, 2022 19:42
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Interesting that as soon as you got a substitute agent the deal changed
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May 15, 2022 19:47
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Thom Yorke raps posted:My agent is out of the office because his father died, and someone else is filling in. Are you talking about different things here? "Buyers agent contract" in this context sounds like the agreement between you and your realtor, not an agreement between a buyer and seller. Contracts on houses can indeed be very short, but this doesn't sound like a contract on a house.
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May 15, 2022 20:07
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Yeah buyers agent contract is just between you and the realtor. Three months is just to make sure it covers enough time to look for a few houses, make offers, then go through the whole process.
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May 15, 2022 20:15
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saintonan posted:Are you talking about different things here? "Buyers agent contract" in this context sounds like the agreement between you and your realtor, not an agreement between a buyer and seller. Contracts on houses can indeed be very short, but this doesn't sound like a contract on a house. No, it's a buyers agent contract, so the seller isn't involved he said: "The representation is only for this deal. It automatically ends if this deal dies." but that doesn't seem to be true? Unless "settlement" includes us backing out of buying the place because the inspection comes back bad or whatever.  BonoMan posted:Yeah buyers agent contract is just between you and the realtor. Three months is just to make sure it covers enough time to look for a few houses, make offers, then go through the whole process. I know that. I don't want to commit to using this agent for three months, I just want to use him for this offer on this house - and TBH, I don't even want to use him for that at this point, I'd rather use my original agent
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May 15, 2022 20:39
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Yeah, seems weird that this new agent is trying to force an exclusivity contract on you when he is just filling in for your normal agent.
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May 15, 2022 20:43
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Lol that literally says “applies to any property”. Dude is either trying to snake you away from your regular agent or stupid beyond belief. You can always sign an extension if your offer is accepted and the fill in is needed past a week.
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May 15, 2022 21:06
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Thom Yorke raps posted:No, it's a buyers agent contract, so the seller isn't involved Just tell him that he can either give you the same date as your original agent or he can pound sand.
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May 15, 2022 21:17
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spf3million posted:Yeah, seems weird that this new agent is trying to force an exclusivity contract on you when he is just filling in for your normal agent. Yeah on second thought... Why the new contract if he's just filling in? Or does the first agent think he's going to be out for an indefinite period? If they're from the same group surely they have a better way to handle this.
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May 15, 2022 21:21
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QuarkJets posted:Just tell him that he can either give you the same date as your original agent or he can pound sand. Actually, ignore my post. Call someone above them at the brokerage and tell them that you want someone else to fill in.
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May 15, 2022 21:32
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So, I just kept asking him to explain why it was different this time, compared to last, and he wouldn't. He also said my agent would represent me in the sale no matter what - however, the paperwork for the contract has his name on it. I ignored him for a bit and he sent quote:I can change the date to whatever you'd like. It really does not matter. If you look at the next line after the date it says, "or before if Buyer and Broker agree." My actual agent is back in the office tomorrow, and there are no other offers on the house, so I'm going to just talk to my agent tomorrow.
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May 15, 2022 22:10
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Thom Yorke raps posted:So, I just kept asking him to explain why it was different this time, compared to last, and he wouldn't. He also said my agent would represent me in the sale no matter what - however, the paperwork for the contract has his name on it. He's agreed to change the date, just tell him whatever date you want. No further discussion necessary
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May 15, 2022 22:51
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Eh. If your usual guy is back in the office tomorrow, just wait until then. Unless you’re permanently stuck with this goober now…
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May 15, 2022 22:57
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QuarkJets posted:Only answering the ones I have any knowledge about : Thank you. I've just checked the USDA site and I am both way over the income limit and most of the area I'm looking at doesn't qualify as rural. Which is weird to me, since I know actual farms are in the "urban" area. 5% down shouldn't be too hard, just annoying to have to sell things or save that much decaying cash. I'll have to get in touch with some actual mortgage lenders to get answers to the other questions and get a pre-qualification. I assume I should talk to a few, the thread has shown that the industry is inconsistent. Is there a way I can do that without them pulling my credit report excessively or at all? Every part of the real estate industry seems to be covered in asterisks.
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May 16, 2022 01:08
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The VA also offers zero-down mortgage loans, if you qualify.
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May 16, 2022 01:11
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pointlesspart posted:Thank you. I've just checked the USDA site and I am both way over the income limit and most of the area I'm looking at doesn't qualify as rural. Which is weird to me, since I know actual farms are in the "urban" area. 5% down shouldn't be too hard, just annoying to have to sell things or save that much decaying cash. I read through your post just now. It looks to me like between your taxable investment account, cash, and the payout from your old job, you'll have around $40k to $50k available in cash to shop with. That's a 20% down payment on a house up to $200k, so if you're buying in that range, you can make a full 20% down, pay no mortgage interest, and easily qualify for a loan with your old or new income. Easily, despite the student loans. In the $200k-$400k range, you're looking at less than 20% down unless you save more money. That's fine: at 10%+ down, you'll be paying some mortgage insurance premium (PMI), but it won't be a ton. You'll still easily qualify for your loan. I do not think it is a good idea to intentionally try to buy at less than 10% down payment, even if you can find a qualifying property, USDA stuff, etc. The down payment is all of the equity you have in the house on the day of purchase - it's your buffer for the eventuality that both the home price falls, and you need to sell it for any reason. There's lots of reasons why you might unexpectedly have to sell - a catastrophic accident that leaves you disabled and unable to work in your chosen career, or maybe your job moves and wants you to move too, or maybe you get married or who knows? In addition, you should open up a mortgage amortization calculator and take a look at how much you actually pay over the life of a loan, of various lengths, and of varying sizes. For example if you're looking at a $300k home, look at mortgages of 30 and 15 years, you could calculate at around 5% APR, of $240k, $270k, and $285k, and see what your total cost of the loan is, assuming you pay it all off. You'll see that larger down payments save you significantly on interest over the life of the loan.
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May 16, 2022 02:15
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Leperflesh posted:I read through your post just now. It looks to me like between your taxable investment account, cash, and the payout from your old job, you'll have around $40k to $50k available in cash to shop with. That's a 20% down payment on a house up to $200k, so if you're buying in that range, you can make a full 20% down, pay no mortgage interest, and easily qualify for a loan with your old or new income. Easily, despite the student loans. If you only have $40k available cash you can't afford a $40k down payment, especially in this market where you aren't going to get sellers covering closing costs.
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May 16, 2022 02:28
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Yeah but I figured as a starting point, a guy making $115k can come up with another $5-10k to cover additional costs, or just back off of a given price point to free up that cash, etc. There's no specific timeline given, so we're doing back of the envelope math to see approximately what budget to shop at and how much down payment should be made.
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May 16, 2022 06:17
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My friend went through some near-miss house buying trauma I thought you might all enjoy. So they bid on a house at their absolute maximum price point, in a town with very little inventory in their range. It's their "forever dream home". To be competitive, they put down 20% as earnest money - about 150k - and waive their financing contingency. They're already beyond pre-approved, they've provided their lender with a ton of bank statements and tax docs, I think they might even have been rate locked, but the point is they felt 100% sure financing would never be an issue. They win the house, and they think they're geniuses since the home had offers coming in well above theirs. Their offer was just so bomb proof, the sellers couldn't pass. The DAY BEFORE closing, underwriting notices that someone has a right of first refusal on the deed. I don't know the details, apparently it's no big deal, and they always just let the deal proceed, but it gives the bank jitters, and they decide to tank the loving deal! 150k of earnest money now hangs in the balance because of some paper pusher at the bank. In the end, my buddy's real estate attorney calls up his buddy, the banks president or something, and gets him to shove the deal through. They close, disaster avoided. I think my friend is a loving idiot and hopefully it's a lesson learned for them. Got away with it by the absolute skin of his teeth. Don't waive your financing contingencies kids. Or put 20% down as earnest. hobbez fucked around with this message at 17:46 on May 16, 2022 |
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May 16, 2022 17:43
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It should not take till the day before closing to discover an encumbrance on the title. That should have been found by the title search at the beginning of the process. This is also what title insurance is for - the bank's title insurance only covers them, part of the buying costs that you can and should opt for is your own title insurance. Yes, it's an expense that 99.9% of the time is "wasted" but on the rare occasion that there's a flaw in the title, that's what that insurance is for. It's normally just a couple or three hundred bucks on top of the lender's policy (it's common to bundle them with the same insurer, so ask about that). Of course, there's always a chance that the title insurance doesn't cover this specific case, so the details matter. e. still agree bigly on the 20% earnest money, don't do that jesus christ
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May 16, 2022 17:52
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Leperflesh posted:It should not take till the day before closing to discover an encumbrance on the title. That should have been found by the title search at the beginning of the process. This is also what title insurance is for - the bank's title insurance only covers them, part of the buying costs that you can and should opt for is your own title insurance. Yes, it's an expense that 99.9% of the time is "wasted" but on the rare occasion that there's a flaw in the title, that's what that insurance is for. It's normally just a couple or three hundred bucks on top of the lender's policy (it's common to bundle them with the same insurer, so ask about that). Good to know. I don't have enough details to say exactly what went down, my buddy was just telling me about it in the midst of his move. Just thought it was a valuable cautionary tale and that, unless you are literally buying straight cash, financing can always fall through.
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May 16, 2022 17:53
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The mere idea of 20% earnest has me physically queasy. Like, that's more than enough to incentivize the seller to attempt to tank the deal within plausible deniability.
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May 16, 2022 18:03
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Yeah. I think we used to tell people to get buyer's title insurance but that recommendation hasn't been re-posted much lately, probably just an oversight. Most buyers don't do it, many probably don't even know it's an option, and some see a line item on the HUD-1 that says title insurance and think it's covering them, when it isn't.
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May 16, 2022 18:04
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I’ve been reminded a couple times, but yeah, worth reiterating.
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May 16, 2022 18:06
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My friends recently bought a very old house that was a rental. It appears to have all the problems you might expect including uneven floors, single pane windows and a shower drain that just drains beneath the house. Still not sure why they went for that one and I am afraid to pry or ask too many questions. I am not sure they realize how expensive it might be to get it into good shape.
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May 16, 2022 18:13
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CongoJack posted:My friends recently bought a very old house that was a rental. It appears to have all the problems you might expect including ... a shower drain that just drains beneath the house. Holy poo poo, that must be fifty shades of illegal.
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May 16, 2022 18:19
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Leperflesh posted:I think we used to tell people to get buyer's title insurance but that recommendation hasn't been re-posted much lately, probably just an oversight. Most buyers don't do it, many probably don't even know it's an option, and some see a line item on the HUD-1 that says title insurance and think it's covering them, when it isn't. One or more posters wanted to argue the last time I brought it up as useless/doesn't cover anything.
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May 16, 2022 18:56
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I have seen some absolutely wild title poo poo before and will be getting buyer's title insurance. It's not particularly expensive and once in a rare while the title is absolutely wildly hosed up. Like a plot being broken into 3 houses, but the plots were split into 2. Or your back yard is actually part of 150 years of land transactions and mineral rights/the land got mixed up so it's now owned by some corporation and was never part of the house, but the company is trying to generate cash and now wants to sell/sue you for it. I think the "worthless" probably relates to small claims kinda stuff like does the 6" you fight with your neighbor over, who really owns that fence and what not. edit: the rate was probably than 1/10,000 - but as the 2 above situations & below go - when it's bad, it's really bad. Also BofA did this poo poo in '08/'09 where they were selling homes they foreclosed on the 2nd lien but still held the 1st. Illegal as gently caress, but never happened on houses title insurance was purchased. 1st_Panzer_Div. fucked around with this message at 01:52 on May 17, 2022 |
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May 16, 2022 21:46
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I'll just repost this title story to contribute to title chat:Insurrectum posted:We closed on our house tomorrow and the entire process has gone super smoothly, but our real estate agent also told us a buyers horror story they were currently going through with another client that speaks to the importance of title insurance and how hosed you can be when a real estate deal goes wrong.
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May 16, 2022 23:50
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Insurrectum posted:I'll just repost this title story to contribute to title chat: Ask your agent for the final resolution to that story?
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May 17, 2022 00:01
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Lol got our prelim title and of course... it's not quite 100%. There's a 5' sliver of the lot that didn't convey with the last sale. History of the house - built '07 & sold before completion. Foreclosed/DIL 2008 (pending full title), then sold to the current owners in '08. I think the neighbors built a fence when it was foreclosed and managed to grab the 5'. Sewer inspection complete so it's not a main line running through. Inspection didn't yield much, some repairs to the fiber cement siding - it was caulked instead of flashing. Not sure if that's something I do myself or we hire. Some window seals are broke - so gonna ask for borrower to buy all new windows. And a new water heater. And roof repairs. They already covered closing costs in a crazy hot market, would be great if they cover repairs. The loan is moving forward & locked at 4.875, I'm still not sure how we got so lucky on the rate.
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May 17, 2022 20:56
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