House-buying thread - Why is everyone involved in this process so deeply stupid?

The Something Awful Forums > Discussion > Ask/Tell > Business, Finance, and Careers > House-buying thread - Why is everyone involved in this process so deeply stupid?

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lampey: Mar 27, 2012

QuarkJets posted:

I think I told this story in the thread back when it was actually happening, across several posts, so here's the full thing:

My wife and I tried to buy a nice house at a good price in an area that we like, but sewer inspections aren't normally done here. The house was on a cul de sac and we noticed a lot of large trees in the front yard along the path where we suspected the sewer line was, so we decided to get a sewer inspection to make sure that there weren't any major surprises and so that we could know exactly where the line is, if we ever wanted to significantly alter the yard.

There were no roots clogging the lines, but the main sewer line under the house had basically collapsed. "I've never seen a line sagging this badly" was said several times by the inspector. The worst part was the location; the sagging segment started from a bedroom, ran through the epicenter of the house (where a bathroom was located), through the middle of the kitchen, and under the entirety of the garage. The entire segment was completely underwater, meaning that you basically had a tiny cesspool under the house that would fill up over time until your house eventually gets flooded with sewage. The owners surely knew, as the lines had recently been jet-washed. This is a sure way to clear out any lingering sewage; you basically put high pressure on the sewer line and push everything out, but it also runs the risk of eventually breaking the sewer line. The only way to fix it is to dig out and replace all of that pipe. To replace the line you'd basically have to completely redo the bathroom, the kitchen, and the floor of one bedroom. Estimated cost for the repair was $50k. Sellers wanted to get two more quotes, which were each also $50k. Seller refused to do anything about it, but luckily we were within our contingency period, so we pulled out.

Do never buy (or if you buy, do never forego a sewer inspection)

Would trenchless/pipebursting have been an option in this case?

Edit, I am considering buying a home in Alameda county where a home has to have the old sewer line replaced when it is sold. It costs 8-10k from what I have seen. The market is pretty hot so the buyer is generally required to pay for this complicating VA loans.

lampey fucked around with this message at 20:34 on Jun 5, 2015

# ¿ Jun 5, 2015 20:30

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# ¿ May 13, 2024 23:32

lampey: Mar 27, 2012

A COMPUTER GUY posted:

The HOA board president at the condo complex where I live is a tremendous rear end in a top hat. A couple years ago, my wife and I inherited a condo that we've been living in and saving up piles of cash for a down payment on a SFH. We're ready now, and we want to rent out the condo for extra income. The HOA confirmed for me that we can rent the unit out once we buy, but we'll have to do it quickly since literally only one more unit can be rented out before the complex hits the rental capacity.

The board president came to my place and told me that he was planning on buying another unit here and renting it out, and I had better not rent mine out or he'll make my life hell.

I'm not sure why he can't just change the rule to allow more renters. In any case, do never buy a condo.

If you have lived there for 2+ years and decide to rent it out wouldn't you be in a different category than someone who hasn't?

# ¿ Jun 16, 2015 18:32

lampey: Mar 27, 2012

Good-Natured Filth posted:

Since we're throwing out our HOA anecdotes:

I remember my dad tried to start an HOA in our neighborhood when I was a kid (mainly because he wanted to have everyone pitch in to maintain the island in front of his house), and then some lady came to him since he was the unofficial board president and complained about a neighbor's "non-standard" mailbox. My dad was like "gently caress this" and disbanded the board and tore up the paperwork before they made anything official. Nobody else wanted to put in the effort, so 20 years later, still no HOA in his neighborhood.

In another story, a friend of mine pays $30 a month to his HOA for what appears to be no benefit whatsoever. There's no common grounds area to maintain, no pool, no islands, nothing. I honestly think he pays it just to be able to live in the school district he's in because it's supposed to be the "best in the city."

A lot of areas maintain the sewer drains and other common grounds that are not the responsibility of the city. He should look over the HOA financials and see exactly what the money is being spent on.

I have been reading a lot of different HOA documents and disclosures and have not seen anything unreasonable in any of the VA approved condos. I was surprised that there weren't any restrictions on size or breed of pets, just total number for all of them.

Citizen Tayne posted:

If it doesn't have a real foundation and basement, the best thing to do is light it on fire.

Why does a garage need to have a foundation and basement?

# ¿ Jun 20, 2015 03:14

lampey: Mar 27, 2012

Jose Cuervo posted:

If it is the second then are you tracking the U.S. 10 year treasury note? The daily mortgage rate tracks the U.S. 10 year treasury note. Over the past 3 months the trend has been upwards - with small local dips. You can also see that on Friday it was at a local low point, after which it has done nothing but go up.

My advice (and the advice I was given and which I should have taken) is to lock in your rate and not stress about it any more.

Past performance is not an indicator of future performance. There are no trends to follow. I agree with the last point.

# ¿ Jun 25, 2015 20:41

lampey: Mar 27, 2012

Aggro posted:

My fianc� and I finally got everything moved into the new house and started unpacking. I put all my clothes into the nice, new closet and...

Do never buy.

That is a straightforward fix to get some heavier duty hardware. Was it just hooked into the drywall and not the studs, or did the hardware just break where it connects to the rack?

# ¿ Jun 29, 2015 09:30

lampey: Mar 27, 2012

EZipperelli posted:

So I have a question regarding contracts.

My girlfriend and I have entered into contract for a 4/3 on .3 acres (Gainesville, FL), with an agreed upon price of $200k.

We also added into the contract that we are asking $2k for carpet replacement, $1k for general repairs and seller pays $3k at closing. The sellers agreed to all our terms, and signed the contract.

Just today we got a call from our agent saying that the sellers are refusing to give us the money for general repairs, citing what we asked for as being "cosmetic." For reference, we asked for an exterior doorframe replacement because of water damage with visible mold, smoke detector replacement (7) because the current ones are 12 years old (FD and insurance companies recommend replacement at 10, with failure rate increasing exponentially for each year thereafter), replacement of 4 exterior pieces of hardiboard (hardy board?) because they have visible mold and are beginning to come off the home, and 2 small portions of the roof (shingles) to be replaced because of visible damage.

My question is really a 3 parter. 1. Do they have a legal leg to stand on, telling us 'no,' for any reason at all, being that they signed the contract for "general repairs" and made no exception for 'cosmetic damage' 2. Is what we're asking really all that outrageous as far as general repairs? I mean, there's issues with one of the homes sinks having legit cosmetic damage, 2 or 3 areas of damage to the walls, etc., and we're not asking for those issues to be fixed, and 3. What legal recourse do we have if they outright tell us "no, we're not fixing anything?"

I never would've thought we would have run into these issues, especially being that they willingly signed the drat contract, but the further into the process we get, the shadier and more lovely the sellers are getting.

Edit: We already had the home inspection, with the inspector citing all the critical repairs, and we shared the inspection with the sellers, so they know we're not pulling repairs and quotes out of our asses.

If there was something serious to hide they would not care about a few thousand. Even a rational person would not want the deal to fall through and have to make another mortgage payment while finding new buyers, and have to deal with the legal issues. They just got cold feet and wanted more money.

# ¿ Jun 30, 2015 03:05

lampey: Mar 27, 2012

Ropes4u posted:

Quick question - if all things were the same would you rather buy a new house or 1950s house?

It depends on the layout of the houses. A lot of homes new and old have wasteful layouts or impractically small or large rooms. Around here a lot of the homes built in the 20s-30s have been renovated multiple times with a hodgepodge of newer and older materials. There are a lot of great older houses but they will be a slight premium.

# ¿ Jul 9, 2015 02:15

lampey: Mar 27, 2012

Omne posted:

Sounds like 1920 Young Ave to me!

I don't think it's unusual, just not something I had really seen before. What's really crazy is Shelby County has very high property taxes already (4.37) and then Memphis city adds another 3.4 on top of that.

What are those when you convert them to percentages? In Oakland property tax increases are limited to 2% per year under prop 13. There is a homeowners exemption for $7000. Base tax is 1.25% but with the additional charges it is about 1.44%. Are your taxes really almost 8% per year?

# ¿ Jul 17, 2015 20:51

lampey: Mar 27, 2012

Yoshifan823 posted:

This is a weird random itch I'm having, so I'm asking to see if anyone has any experience/knowledge about this particular subject.

My parents live on an acreage, about 3 acres, and there's a gorgeous clearing that I've had to mow repeatedly over the course of my life, and I was just wondering, if you already have the land at your disposal, how much does it cost to just build a house? More/less than going and buying one that's already in existence? I've looked at a bunch of prefab models as well, and there are a few I found interesting, are those only for people in specific areas of the country (i.e. California)? I would want something fairly minimal, no more than 1400 sq. feet/2bd/2br, both to keep costs down and because I have no idea what I would do with all that space, and I would try to make it efficient as possible, ideally I would be able to control all of my stuff (lights/security/thermometer/media/appliances) with my phone. Is this just the area for rich people, or could an enterprising young person with little debt and lots of life to live set himself up now?

It's not something that's going to happen anytime within the next year or so (I just signed a lease for a year, so I'm locked down for that long), but as I figure out what I want to do as a career, I'm

In Michigan you would get a mobile home to meet all of these needs. If you wanted to have a house built the costs are highly variable depending on what you want but $80 a sq ft is the low end for most areas. Anything rectangular like a saltbox will be cheaper to construct. There are other less traditional options like pacific yurts or other semi permanent housing.

# ¿ Jul 20, 2015 10:40

lampey: Mar 27, 2012

Mary loving Poppins posted:

I did, yeah. I called a few places up and haven't had much luck. My realtor, on the other hand, brought over a friend of his who is a new home builder (not a foundation contractor) who happened to be at the bar down the street, and he sees "absolutely nothing wrong with the foundation." He said that he looked into the hole, felt around, and didn't think the problem extended deeper. I asked him "Given that you can't see what's below ground and what you *can* see above ground is crumbling, how can you be confident it's isolated only to where you can see?" He said that if it went deeper the debris would be falling below eyesight, not sitting stacked where it was. He also said "it's not like I can stick my arm clear through the wall" as if the house were a big game of Jenga and as long as it's not falling over, I win. This is a nightmare.

There is a chance that what your realtors friend who is totally not looking out for the realtor says is true. You may buy the house and not have any substantial problems with the foundation. Or you might have to spend 20k+ on repairs and then have a harder time ever selling the property in the future. I would get a quote from someone who specializes in this work and then reconsider if you still want to buy with the new info.

# ¿ Jul 22, 2015 19:18

lampey: Mar 27, 2012

I have an offer accepted on a condo for 300k and now when getting the finalized quotes for the mortgage rate the lender I made an offer with is 1.25 points higher than a competitor. When I was preapproved 2 months ago and made another offer the rates were better with 0 points. If it was a little bit of money it wouldn't be worth the paperwork, and I have 27/30 days until closing so I feel like there is still time to change. It is the difference between $3400 in lender credit to go with the new company and paying $500-$750 to get the same rate with the lender I got pre-approved on and made the offer.

Would you change lenders in contract to save ~$3500?

# ¿ Jul 23, 2015 19:08

lampey: Mar 27, 2012

Spermy Smurf posted:

I would change to save $500. Ask the first one to match the second one.

They are $3500 apart after asking to match. 3.75% with a little over 1 negative point vs 3.875 with 0 points.
I have my answer then.

# ¿ Jul 23, 2015 19:35

lampey: Mar 27, 2012

Monechetti posted:

The house is two stories, with about four different roof faces, and you can't see the place where the damage is from the street at all. We were told the roof needed to have 3-5 years of life left in order for the house to be salable (or maybe more correctly, for us to get the loan) and so they hired contractors to get it to that point, which it obviously wasn't. The appraiser came back and said it was "satisfactory" but it's pretty obvious that it wasn't. I'm not a licensed contractor or an expert in roofs, so even if I'd climbed up there, I don't know what I'd be looking for. I feel pretty strongly that the bank and appraiser should have been the ones to figure out if it was safe or not. In fact, the first appraiser said the roof needed to be "greatly repaired/replaced and inspected by a licensed roofer" and neither were done.

How much does it cost to repair/replace the roof now?

# ¿ Jul 24, 2015 20:40

lampey: Mar 27, 2012

Stefan Prodan posted:

I dunno if this should go in this thread but I have a Dodd-Frank question if there are any bank people here or people who know a lot about loans:

I am a professional poker player and as such banks will basically not let me count much at all of my income as income because they think it's a lot more variable than it really is I think. As such, the only income I can count for loans is income from stock dividends and that sort of thing. I have one rental property and when I was getting a loan for my current house the loan officer told me that even though my property is bringing in $1400 a month and the PITI on it is $700, they won't let me count the income because the people might move out BUT they are going to count the debt against me.

I want to keep building a portfolio of rental houses because I'm pretty well loaded up on stocks, but as far as I can tell they are simply gonna stop loaning me money after one or two more because they are gonna count my payments against me but not count my income as a plus.

I was wondering if there's any solution to this, and what companies like REITs do to get around this. My first thought was maybe to make some sort of corporation where I am the president and I pay myself a salary which is like $6000 a year or something, or whatever I think my net from the rental will usually be? Would I be able to just count that as income in that case?

One of the big things that makes rental properties a good investment is the leverage you're able to use in a relatively low-risk proposition, if I had to buy these places for cash the return would be pretty small so I'd really like to be able to keep accumulating them with loans but I'm not sure how to go about doing it without eventually just running into an artificial limit.

Talk to a different bank. One of the loan officers/underwriters wanted to include payments in my wife's student loans and a full credit check . There is at least a year before she will have to make payments and she is not a us citizen. No ssn or residency. Two other banks had no problem just using my credit.
For self employed income not every bank has the same requirements.

# ¿ Jul 27, 2015 17:49

lampey: Mar 27, 2012

The way to save money would be to find a licensed real estate agent that would rebate you a portion of the commission. You would have to do all the work by yourself and would have to find a real estate agent willing to give up most of their commission. This isn't practical in many states. I would talk with someone who has sold a house to see what their experiences with agent less buyers are first before making any offers. There is a lot that goes into getting an offer accepted besides :10bux:

# ¿ Jul 28, 2015 05:32

lampey: Mar 27, 2012

climboutonalimb posted:

I live in a rent controlled apartment in SF for ~$2k/month but I'm considering buying into this partially bubbled market. I'd be a first time home buyer. At best, I'd be able to afford a $700k 1b/ba condo... I probably shouldn't do this, should I?

It would cost you around 4k a month for hoa+taxes+mortgage+interest+insurance to borrow $540,000 putting 10% down on a $600,000 condo. It would be difficult to make a competitive offer in this market using an FHA loan with 3.5% down but it is possible if you find a condo that went back on the market after a sale falling through. If you can get 20% down you can get a lower interest rate and not have to pay pmi, but there is a large opportunity cost to put that much down. San francisco has strict rent control laws which can make the decision to rent more difficult if you decide to move later. If you do rent it out and then want to sell, it could make a big difference in the price.

I would keep renting for as long as possible at that price.

# ¿ Jul 29, 2015 03:33

lampey: Mar 27, 2012

Harmburger posted:

When's the right time to shop around for lenders? I had a pretty good quote from Navy Federal that I got pre-approval through,(3.5%) but worth checking out other rates I suppose. Looking at VA 30 year fixed if that makes a difference. We found a place we liked and submitted an offer already.

edit: Lender's fees is 1% origination, with a 2.15% VA funding fee rolled into the loan, though I'm hoping to get the 3.25% with 1 point/1% origination also advertised.

I just changed lenders after having an offer accepted but it would be easiest if you can get preapproval and use the same company for the offer and the closing. Some sellers do not like to change lenders especially if you are tight on the closing time. I would get a quote from merchants home lending or some other companies in your area.

# ¿ Aug 6, 2015 07:20

lampey: Mar 27, 2012

DaveSauce posted:

So this kind of turned in to a wall of text, so bear with me here.

My wife and I are considering a house pretty soon here, and we have some questions on a few things before jump in to it seriously.

First, a question on our credit history/ability:

My wife found out that she basically has (had) no credit worthy of borrowing large amounts. She has had a couple credit cards for at least the past 10 years, and she used them occasionally and always paid them off the next month (with maybe a few exceptions, but she always at least made minimum payment). Her credit score is pretty good, but apparently there's no "real history" on her report.

We found this out because about 18 months ago we bought a car. We had tried to get financing through our credit union and they wouldn't give us as much as we asked for because, in their words, she didn't have any credit history showing her ability to pay off large sums over time (i.e. a car or house, things you generally can't pay off all at once). They ended up offering us less than we asked for (because frankly we asked for a couple grand more than we needed, just in case), and it's a moot point anyhow because the dealer had 0.9% financing so we took that instead.

I, on the other hand, have a massive credit history in that respect, but it's basically because I have debt. Student loans mainly, and now the auto loan is on my history. That said, I have exactly $0 in credit card debt. No late payments on anything, though I have carried a balance a handful of times.

So the question is, we're both about to be first-time home buyers, so how is all this going to impact our ability to get a loan? I just refinanced my student loans a few months ago and they told me my FICO score was 805 (Mint's free thingy tells me 758 right now). I think Mint is telling my wife she's at 775 or something, but again the only big ticket thing she has is the auto loan. We both have very good income, but we're mostly concerned about her relative lack of credit history, and the fact that neither of us have ever owned a home.

And then the next question is regarding mortgage terms:

So we're debating between a 15 and 30 year mortgage. The issue is that homes that we're looking at right now are in the range of 225-300k. Based on monthly payments, down payment ability, and what's available in the area, we've targeted 250k as our intended price, with 300k as a max. So with that, after you figure taxes/insurance/etc, the 30-year payment seems very manageable, but the 15-year payment is bordering on uncomfortable (we can absolutely afford it, but we just don't want to).

Our biggest unknown is how long we'll be staying in the area. We have no plans to move, but we're engineers, so that's a distinct possibility. But we can't really plan on that, since we'd never be able to buy a house until we retire if that were the deciding factor. The thing we KNOW is that we intend on having kids in the next year or two. We figure this gives us a solid 5-7 years before we would really want to plant roots and stay put. This works for and against us, really...but mainly it means that we have the potential to up and move in that time frame, so it complicates the decision slightly.

So that said, the main reason we're looking at the 250k range is that we want something that could support a family long-term (3+ bedrooms, 2+ bath, yard, etc.). However, we could also go with a sub-$200k house that's just big enough for the next few years, get a 15-year loan, pump money in to it to build equity, then upgrade to something bigger down the road. But my hesitation there is that rates will likely be higher by then, so while our loan would be smaller we'd be paying higher interest on it. And, if the housing market takes a giant poo poo, we'd be stuck in a cramped house for a while (though we could theoretically rent it out while we buy a bigger house on the cheap, but I don't want to touch that with a 10-foot pole).

There's a lot of possibilities, but I guess that's a separate discussion. Here's what what we've figured on a 15-year mortgage on a 250k house:

Pros:
-Saves us over $90k in interest over the life of the loan, which is an assload of money
-More goes to principal sooner (so if we sell/move before we pay it off, we have more equity built up)

Cons:
-No flexibility on payment (we could overpay a 30-year loan easily, and drop back to minimum if we run in to trouble)
-Lower cashflow, so other savings accounts/investments grow slower
-Only way to lower the monthly payment is to get less house

So with that, I decided to figure out what the lost opportunity cost would be. An easy example is our credit union checking account, which gets a dividend of 2.01% APY each month (as long as we make 30+ transactions each month, which we do easily).

My assumptions are:
-250k house
-50k down payment
-30-year rate = 4.375% (worst rate per CFPB.gov, using above numbers, state is NC and credit score is 740-759)
-15-year rate = 3.750% (worst rate per CFPB.gov, using above numbers, state is NC and credit score is 740-759)

My math gets me a difference in monthly payment of $455.88. If we take that money and dump it in to a 2.01% APY (~1.99 APR) account each month will, over 15 years, turn in to $95,529.27 (compounded monthly). Can someone check my math on that?

Looking at it, the actual difference in interest over the life of a 30 year vs 15 year loan is $97,685.31. So we technically lose $2156.04 over 15 years, assuming savings interest rates don't go up at all (and we don't shuffle that money in to something with a higher yield like a retirement account). And this seems to be worst-case.

Now, if I take the best-case interest rates from CFPB.gov (3.875/3.125 for 30/15 respectively), the difference in monthly payment is smaller, so over 15 years I end up with about $1,000 less accumulated in savings. However, the difference in interest cost is $10k less over the life of the loan (about $87k instead of $97k), so I would actually come out ahead by using the 30-year mortgage (instead of losing $2156.04, I would gain about $6.5k).

So can someone check my logic/math here? Because I think I just talked myself in to a 30 year mortgage, which doesn't seem to make financial sense to me...I must be missing something. Naturally, this ONLY works if we put that extra money each month in to the mortgage or in to savings/investments. It's all out the window if we take that money and spend it on booze (or more realistically, cars we can't afford or a boat or other expensive grown-up toys that we have no interest in).

For the difference between 15 year and 30 it is just in the interest rate and time period so when you are moving is not an issue for this part of the decision. Also if your best alternative to paying down the mortgage is only 2%(- taxes) you would be best off paying the mortgage down at almost any interest rate. Most get a rate of 4%+ over long term with a diversified mutual fund/eft so that could change the results in favor of the 30 year loan.
If you are not living in the same place for long you are paying 4% to buy and 6% to sell. Some of these costs are shared with the other party but ~10% total to buy then sell seems to be the going rate.

# ¿ Aug 6, 2015 19:05

lampey: Mar 27, 2012

I was supposed to sign the loan docs for a closing on the 20th, but it's delayed pending a new mold inspection. There was supposed to be one after some insurance work but it can't be found now. I'm glad I didn't rent a moving truck or give notice to my current rental. There will always be unexpected delays

# ¿ Aug 14, 2015 23:00

lampey: Mar 27, 2012

I just finished buy a condo in the bay area. The idea of earnest money is to compensate the seller for taking the home off the market if your deal does not go through. Sales close relatively fast here, 30 days is expected by most sellers. In CA the seller will get the whole thing back during the inspection period ( I think mine was 10 or 14 days), and if there is anything that comes up it can be extended. For me there was a mold report and it took a little longer for the HOA CC&Rs to come in, then I got 5 days after receiving those. Earnest money here is 3% so ~9k for me. If you get a foundation inspector to take a look at the home you would have to pay for the inspection but could back out of the deal. The realtor may have meant that it is not a competitive offer to make the offer contingent on the inspection, but I would not make an offer you are not comfortable with. The foundation is potentially a major issue that could prevent you from reselling so I would get a thourough inspection if it looks worse in person.

# ¿ Sep 8, 2015 00:10

lampey: Mar 27, 2012

If you are concerned the house won't pass the inspection write an offer with no due diligence and make the offer contingent on inspection.
It may be normal to include this money but do what works for you. It is normal for the buyer to pay most of the closing costs including the transfer tax. My offer included the buyer paying the transfer tax (2k+), no waived inspections and it was accepted. Don't get emotionally attached and don't make an offer you aren't comfortable with. The real estate agent wants the deal to close more than they want to save you a few thousand.

# ¿ Sep 8, 2015 17:45

lampey: Mar 27, 2012

SiliconX posted:

I know this question(s) might be a little unorthodox for this thread but I'm at a point where I can't really turn to people I know just yet, so I'm hoping to find some answers here.

Quick backstory. My wife and I have been married just a hair under a year. We had been clearing debts and helping her rebuild her credit since she had a bankruptcy. In August, we found a good home at a comfortable price of $410,500. Since we both make ok money (me $70K a year and her $80K a year), we were poised for a comfortable life until yesterday when the marriage fell apart (I won't go into that here).

Possession date is October 2. We've signed all the mortgage documents. All the paperwork is at the lawyers. I haven't put the entire downpayment of $57,000 in but I have given the sellers the $10000 deposit.

Can I afford this house on my own? Probably. I take home about $4000/month. We got a really great interest rate at 2.09% fixed over two years. But still after payments, taxes and utilities and insurance I'm still going to be $2100-2200 a month, and I'm scared that I'll be house poor and if anything bad comes my way, I'll be dead in the water.

At this point, can I still get out of buying this house? I know my deposit would be gone for sure but I'm going to assume I would also have to pay for our realtor and obviously I'd have to pay for the lawyer's time. Or am I stuck and will just have to grin and bear it until I can sell it and not take a bath or, maybe even rent it out. Renting a room isn't an option due to the set up of the house but I might be able to find a cheap place to live and rent the whole place out.

Just really don't know what I should do at this point. Any advice would be appreciated, even if it's not what I want to hear.

I would not buy a home at all considering the circumstances. Your realtor will pressure you into continuing with the sale. Don't buy a house when you might move for any number of reasons very soon. Depending on your contract you may still get your deposit back minus inspection and appraisal fees. Check your contract to see if there is a financing contingency or if there is anything else that would apply.

# ¿ Sep 14, 2015 20:46

lampey: Mar 27, 2012

The HOA fees were raised before I have even made the first payment. Only $21 a month more at least.

# ¿ Sep 16, 2015 02:02

lampey: Mar 27, 2012

Is there any advantage to a tiny house compared to an RV other than aesthetics? Are tiny homes just classified as an RV legally but built out of traditional stick built housing materials?

# ¿ Sep 18, 2015 02:36

lampey: Mar 27, 2012

PMI was .65% where I was looking in CA. Thats like paying an extra 50% property taxes until you hit 22% LTV. VA loans don't have PMI so I'm not sure you if you could get it any lower than that.

# ¿ Sep 25, 2015 08:40

lampey: Mar 27, 2012

I purchased a condo with a VA loan and it greatly affected the properties I could purchase at all, and even more the ones I could make a competitive offer in the bay area. In the end though, the money was more important than waiving inspections and contingencies that a conventional loan would have the advantage.

# ¿ Oct 2, 2015 20:27

lampey: Mar 27, 2012

It sucks that you are being negatively affected by the HOA rules. If you don't want to paint right away you can probably just go to a meeting and ask to delay it to the spring or whenever you have planned. The problem is that there are some people who cause problems for their neighbors and the best way to deal with it is uniform enforcement of the mutually agreed upon rules. As long as the HOA is consistent with its enforcement it prevents a lot of unrelated problems because people know the HOA will act when it is necessary.

# ¿ Oct 27, 2015 20:54

lampey: Mar 27, 2012

xiw posted:

We've been in our new house a month now and nothing surprisingly awful has happened, obviously this post will trigger something, but:

What are non-obvious things we should consider doing / checking / scheduling, as far as preventing future issues?

thanks,

Change the locks or at least rekey them. If you live somewhere hot or cold get window film to prevent heat gain/loss and it can also prevent smash and grab burglaries. It is a good time to paint before you have a lot of furniture and stuff moved in. You can turn off the breakers and check the meter to see if there is anything unexpected drawing power. Caulk any cracks that are letting in outside air and to keep out pests.

# ¿ Oct 29, 2015 01:29

lampey: Mar 27, 2012

mastershakeman posted:

Lining up home insurance for a property you don't own is weird. We had questions about the type of construction of walls, roofs, floors, everything and I'm going heck if I know, I've only been inside it a few times and didn't punch a hole in the wall to find out if it's plaster vs drywall

They just want to estimate the replacement cost. You don't necessarily need to insure the mortgage cost of the home, just the replacement cost. There will be a big difference if you live in an expensive area. My condo replacement cost for walls in is $120 a sq ft but it cost $500 a sq ft to buy. Some lenders will try to get you to insure the whole mortgage cost but many states have laws so you are not required to insure more than the real replacement cost.

# ¿ Nov 5, 2015 01:30

lampey: Mar 27, 2012

Captain Windex posted:

Yeah, non married co-borrowers generally isn't a big deal, guidelines are basically the same and you just have different application forms and credit reports rather than joint. The only significant exception I can think of is VA loans, since the VA won't guarantee the co-borrowers portion of the loan if they're not your spouse and/or also an eligible service member/vet. Generally this means that the co-borrower is required to bring in some down payment to cover their half of the missing VA guarantee, though that is lender dependent.

I am married and got a VA loan and my wife(Canadian) had to get a quit claim deed. It was a hassle because there aren't many US notaries in Canada either.

# ¿ Nov 11, 2015 20:28

lampey: Mar 27, 2012

supercrooky posted:

Had an inspection yesterday, which went very well with the exception of the listing agent disclosing there had been a fire requiring a fair bit of repair a few years ago. Obviously I'm also asking this question of professionals, but does anyone have any tips on buying (or not buying) a home with previous fire damage?

Not the same situation, but I recently purchased a condo that had water damage from an upstairs unit flooding. I made sure to get a mold test and they did some moisture tests. It was a VA loan so they are pretty strict on mold and pest reports. The side benefit was that the ceiling paint is new and no more asbestos popcorn ceiling. Make sure you get a thorough inspection and be willing to look elsewhere if you feel uneasy.

# ¿ Nov 23, 2015 06:09

lampey: Mar 27, 2012

Comatoast posted:

I've been lurking in this thread for about a year now. It's irritating to me that in a supposedly free country we cannot buy/sell houses without the myriad of realtors, insurance agents and other crap. 7-8% closing costs makes me fuming mad.

Is there somewhere I can read about how we came to this situation? When was the last time I could legally buy a house on a handshake and a contract written on a napkin?

For content: earlier this week I spotted a piece of property in an area I had previously been ignoring. I left a note on their door asking them to call me when they had some time to walk the property with me, and just this morning I got a call from a realtor. I don't want to talk to a realtor. I want to talk to the person that has been living there for the past seven years and I want them to walk the property with me.

There are a lot of good reasons why the system is the way it is because many homes are bought with a mortgage. You need a public record of sales so that the local gov can tax the right people, and also to resolve disputes with ownership. The title insurance is a bunch of people looking through any public record to make sure there are no problems with the chain of ownership. There are inspections so that you are not getting ripped off buying something not as advertised. Realtors are needed because homes are not fungible and it is a competitive market. Insurance is needed as most people can not afford to rebuild their home after a disaster.

If you are buying investment property or a foreclosure you can skip almost all of this and just deal with it yourself. If you want a handshake deal you could get some owner financed place from a retiring landlord.

Pillowpants posted:

So, how bad will the high credit card debt hurt?
Should they put all four of their names on the mortgage?

I would first decide of it makes more sense to rent out the home or sell it now. If you sell you will have to pay 6%+ in transaction fees. Even if you do for sale by owner, the buyers will just want to offer less money. This really comes down to your local market.
Then you can decide of renting or owning a home makes more sense. If they do not intend on living in the same place for 5+ years they should rent. How much space do they need? If they don't need a lot of space now it can be a lot cheaper than buying. There are a lot of costs of home ownership that are paid by a landlord when renting and it is not always apparent. The buying and selling closing costs are a huge one, along with any long lasting items like a roof. I would have them strongly consider renting an apartment that is no larger than what they need.

If they still want to buy a place, you will have to check with different lenders as they have different requirements. My lender would not do a mortgage with any outstanding judgments, some will allow them if you are on a payment plan. If these are not IRS/tax related judgements you will probably need to negotiate with the creditors to have them paid in full before getting a mortgage. If they are able to be put on a payment plan they can be treated like other debt. As a general rule for every dollar in debt you need 2 to offset it in income for a good ratio. So your brother would need $80k+ in income to qualify for a mortgage while paying off his credit card debt. My lender required having 50% pretax left over after paying mortgage, car loan, credit cards, and any other debt. Do any of these four have 2+ years of job history? Is your MIL's terrible credit from outstanding judgements? Who are the other two people besides BIL and MIL? Do they have a steady job history, good credit and low debt?

Edit*

Pillowpants posted:

If all four names are out on the mortgage would that hep despite two of them being in terrible shape credit wise?

No. Depending on local laws, one of the four could have a lien placed on the home and then have the home foreclosed. This is relatively rare though. Usually if they can get the lien in the first place they will let it gain 10% interest a year until you sell. I wouldn't want to add someone to the mortgage/title and then have any equity wiped out when I sold a property.

lampey fucked around with this message at 00:59 on Nov 29, 2015

# ¿ Nov 29, 2015 00:52

lampey: Mar 27, 2012

I would stick with new tile or laminate if you have dogs. I have seen engineered wood floors heavily scratched after just a few months, not enough that it needed to be replaced but laminate or tile would last a lot longer. If you have large dogs can you just keep the original floors and get a lot of rugs?

# ¿ Dec 4, 2015 02:21

lampey: Mar 27, 2012

Admiral_eX_laX posted:

This whole buying a house idea smells like bad news but I'm afraid of everything. It makes me want to find a cave and live in it. But I have a fiancee now and I don't think she would like a cave.

So my mom tells me she'll loan me 50K towards a down payment on a house. I live in the south US, and what I'm shooting for is around the 100K - 130K mark. This gets you a 3bd 2 full bath, 1500 sq ft give or take. I qualify for a rural development loan.

I would have to sit down with my mother and discuss the terms of this loan. I'd like terms that are fair to the both of us, but hell I have no idea what would be considered fair. What should be stipulated in the loan should I not be able to make payments to her? Settling on a monthly payment should be easy...maybe?? She's not an rear end in a top hat. But I don't want her loving me over either. Best way to accomplish this? Do I need to lawyer up for this poo poo? Poor man's contract?

Sorry to E/N but I feel this is relevant. There is potential for a hosed up situation here. It doesn't help that my mom has a hoarding problem ( it's bad but not nearly as horrible as what you see on TV ) and she's a mormon. My dad purchased the house that she's currently living in in 2004, and it was built in the 70s. It could use some work. He never renovated it before moving in. I feel like she should use that money towards fixing her own drat house. But she's Filipino and playing with the idea of dual PI - USA citizenship where she lives 6 months there and 6 months here.

I plan on buying this house before I get married. We've decided to put off the wedding until I can buy a house ( fiancee is getting her student loans out of default at the moment ). We're going to the JOP to get married. gently caress a wedding ceremony because its expensive and we don't want that stress. We don't want kids, but accidents happen and I'd like to be somewhat prepared.

I have medical debt and am on the track to paying it off in a year. I have a car payment, 11K left on it, I put down 10K on the car initially when I bought it in Aug 2015.

I am in no hurry to get into a house. Our townhouse apartment is borderline ghetto but it's not bad.

There is a lot that can happen between now and after getting married and you don't want to buy a home just to end up selling it quickly. If you do end up buying a home you will still be expected to come up with at least 3.5% down your self for an FHA loan and 5% for a conventional and then you can get a gift for the rest. If your family wants to loan you money instead of a gift just tell them no thanks and save up for a down payment or use one of the first time home buyer programs. There are a lot of other reasons you don't want to rush into buying a home, maintenance is a lot more work, not having an adequate emergency fund could ruin you financially if you are unable to cover a large repair, you can't move if your neighbors suck, financially all of your net worth is in one place, and a house depreciates every year. I would stick with renting to give your more flexibility to move and allow you to save up money.

# ¿ Dec 4, 2015 20:41

lampey: Mar 27, 2012

revmoo posted:

What shithole do you live in that houses depreciate every year?

Homes depreciate and land appreciates. Once you factor in inflation taxes insurance and maintenance home ownership is not a free lunch.

# ¿ Dec 5, 2015 05:46

lampey: Mar 27, 2012

devicenull posted:

Is it normal to have to call the bank daily to make any sort of progress on the mortgage? It seems that every time I call, they say "oh we were waiting for you to provide X", despite having never indicated that. Pretty sure I've provided everything 2-3 times now.

I've resorted to daily calls asking about the status.

This is just a job to them. They don't have the largest purchase of their life to worry about. I would still expect for them to have prompt communication but it depends a lot on the bank.

# ¿ Dec 10, 2015 02:16

lampey: Mar 27, 2012

Leperflesh posted:

You are absolutely, 100% correct, but you should also be aware that there are places in this country where basically 100% of the property is in a 100-year flood plain. Like, entire cities, entire counties. And you can mitigate that poo poo with appropriate construction.

A huge number of people simply have their heads in the sand about it, though, and you're right to emphasize this because there are literally millions of Americans who wilfully ignore their decision to live in a house that is more-or-less statistically guaranteed to be flooded during their lifetimes. But realistically, a lot of those people simply don't have a choice but to live near their jobs in houses they can afford (although they can choose to rent them instead of buying them).

See also: houses built on cliffsides (all cliffsides are eroding, that's what makes them cliffsides), houses built along fault lines, houses built near volcanoes, etc. Add in rising sea levels, and you're talking a pretty significant fraction of American homes built in spots that are very likely to see really serious damage in the next 50 years.

Mine included. Which is why I have earthquake insurance, have strapped my heavy bookshelves to studs, and keep an earthquake kit in the garage.

The key thing I think is that if you are not going to have any equity in your house for the next 8 years, you better make sure the entirety of your mortgage is covered by your flood insurance after deductible.

You should get the rebuild cost covered by insurance, not necessarily your mortgage. If you have a big brick house in a rural area your rebuild cost could be more than the mortgage, but for most it will be less.

# ¿ Dec 21, 2015 03:09

lampey: Mar 27, 2012

Thesaurus posted:

On the topic of new roofs: I always find it fascinating that this is a regularly cited big ticket expense. In Colorado you're pretty much guaranteed to have your roof, gutters, and maybe siding replaced at least once every five years through an insurance claim. Granted, your deductible will probably run you a few G's... but I've never heard of someone having to pay out of pocket for a roof in these parts (I'm sure our premiums reflect that, too).

Our roof and gutters were pretty crappy, and we got the lucky hail storm within three months of moving in.

And why do roofers all have to be shady as hell? So many home services are like that.

Workers comp for roofers can be $50 per hundred in payroll or more for steep roofs. It depends on a lot of factors but the end result is that many of them will just not have workers comp, or they will be insured as carpenters or painters. Then liability insurance is needed but it is relatively more affordable. With home services in general the work is irregular and physically demanding. Once the most capable people leave to higher paying jobs, or jobs that regularly give more hours you end up with a lot of people doing different things as they can find work, and cutting a lot of corners.

# ¿ Jan 6, 2016 07:19

lampey: Mar 27, 2012

Rurutia posted:

Yeah, our area is strange. Our monthly mortgage + insurance + property tax is ~~$300~~ $150 less than a 800 sqft 2 bedroom here. I guess we're lucky in that way?

If you move after 5 years you will pay 10% on closing/realtor costs and 5% on maintenance. That's $37500 on a 250k house over what you would pay for renting. Then you have the opportunity cost of having all that money tied up in a house instead of in a retirement account.

# ¿ Jan 21, 2016 18:41

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# ¿ May 13, 2024 23:32

lampey: Mar 27, 2012

Rurutia posted:

However, your calculations are overly simplistic and your closing costs are too high.

My closing was 9.4% for the HUD-1 line 1400 divided by the purchase price, including both the buyer and seller portion. The realtor only charged a 5% commission. For the maintenance costs, 1% per year is a rule of thumb but your actual costs will depend on the condition of the home for short amounts of time. For the 3-5 year break even were you including the costs of selling your home? Were your buyer+seller closing costs much lower than 10%?

# ¿ Jan 21, 2016 21:11

The Something Awful Forums > Discussion > Ask/Tell > Business, Finance, and Careers > House-buying thread - Why is everyone involved in this process so deeply stupid?

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