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urseus posted:I put down a $20,000 deposit on a 3 bedroom unit thats $401,000, to be finished being built in Feb March. Those numbers sound steep, but granted I don’t know what is customary in Australia. I’ll figure out your debt ratio and express everything as monthly. You make $3900/mo and your friends will be paying $1128/mo. This adds up to $5027/mo. Your loan payment will be $1650/mo. Therefore your debt ratio will be almost 33%, and that’s before condo fees and before utilities. This is an interest only loan too, for housing only, and assumes you will always have both bedrooms 100% rented. Had you gotten a 30 year fixed, which is more responsible, your payment would be $2044, your debt ratio would be 41%. This also assumes rates stay at 5.5%, however at least in the US rates have been creeping up as it appears the economy won’t barrel off a cliff and it sinks in the effect of the borrowing we are doing now will have on future rates. If your rates increase to 6.5%, which is not unreasonable, your debt ratio will be 39% for interest only, 45% for a 30 year fixed. I linked to the calculators I used if you want to play around with the numbers http://www.dinkytown.com/java/AUInterestOnly.html http://www.dinkytown.com/java/AUMortgageLoan.html
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Jun 16, 2009 14:30
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Strict 9 posted:It's not that it won't make or break the house purchase. We have $60,000 saved for our downpayment. What is limiting our house purchase is not the monthly mortage/tax/insurance payments, but the 20% down payment. I just do not want to pay PMI. This is a non issue. If you don’t quite have the 20% and they want you to pay PMI, and the $8,000 tax credit is the only thing from you reaching 20%, just file the amendment after you close, and in a couple months when it comes in, just use it to pay down your loan. Then call and write your mortgage company reminding them that you now have more than 20% equity in the property now, and they should stop charging you PMI.
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Jun 18, 2009 15:28
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Kneel Before Zog posted:I'm very tempted to buy my 3rd house right now ;but I know its unreasonable to be certain of the predicament of our future economy. With warnings about our inflating dollar is it a question of when not if the housing market starts seeing better days again. Right now I have a contract for a 3,000 squarefoot house (biggest i've ever owned)(construction costs alone are more than what I can nab it for) and there's even another one also foreclosing for 280k roughly the same size! My realtor told me I shouldn't hold my breath on flipping the house, but with all my money getting lost in the stockmarket and the bank agreeing to grant me my 3rd mortgage I feel good about this buy. I don't know how many years of interest i'll be paying until falling over in debt but I'll never be able to live with myself if this house values anywhere near the 400,000 dollar price it was sold before the subprime mortgage crisis could have been mine at half that price. I doubt you will get a lot of support for that here. It seems like you are going to be overextended and if I read into it, you are doing this partly out of fear that you will lose the money in the stock market. I agree that a lot of real estate is undervalued, and a sharp guy who can ride it out could eventually make a killing. Ride it out means deep pockets and the ability to pay the mortgage, taxes, maintenance, and needed improvements, even if you can’t sell it right away, even if you can’t rent it right away. You need to be honest if you are that sharp guy who can ride it out.
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Jun 19, 2009 17:35
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OlSpazzy posted:Ok, let me rephrase the question: You can rephrase your question as many times as you want. But I think you were able to communicate your intentions clearly the first time. But let attempt to rephrase what Arzakon said: DON’T EVER BUY A HOUSE WITH TWO OF YOUR FRIENDS! THERE IS ONLY ONE WAY IT WILL WORK OUT FINE. THERE ARE HUNDEREDS OF WAYS THIS CAN SCREW UP! AND IF (WHEN) IT DOES YOU WILL LOSE YOUR FRIENDS, LOSE MONEY, OR BOTH!!! AND I DON’T CARE IF YOUR ONLINE CALCULATOR TELLS YOU IT’S A GOOD IDEA! Also, just so you know, if you do it anyway, there is no such thing as “my portion”.
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Jul 2, 2011 17:39
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CatchrNdRy posted:Ugh the 4.0% rate I had locked down with the local credit union was a no-go due to the fact my PMI servicing (loving MGIC) would not allow a refinance to a company that wasn't my loan originator. That is true. If you are that underwater on your house, no one is going to want to refinance you for anything approaching market rates. I would be surprised if the credit union would have offered you 4% after they did an appraisal. It pains me to say it, but in this case Bank of America gave good advice and you are fortunate to get 4.6% because they didn’t even have to do that.
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Mar 23, 2012 19:06
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All that is interesting, and most of that I didn't know. One question I have is how common are these deals where the borrower is 150% upside down? Is is something in theory that can happen according to the law, or are lenders ramping up these refi programs?
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Mar 24, 2012 23:25
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Orange_Lazarus posted:Yeah, we're in a non-recourse state and Sophia pretty much nailed the ethics part of it. She actually can afford to make her payments but she isn't able to save very much afterwards. I know to some people she might sound like a lovely person for wanting to squat and bail on her debt but she's actually a really great lady who's just going through a rough patch at the moment. Personally I have no qualms with people flipping off the banks, especially when she bought the home back when every "expert" was screaming "the value of your home can only go up up up!!!!" to the uneducated masses. You can do what you want, but if it’s me there is no way I am intertwining my life with your wife’s aunt’s life. If you like the house that much then go to your bank and get your own loan and buy it from her. Otherwise you are in this open ended deal with no clear cut end where there is one way everything works out fine and multitudes of ways it ends in disaster with family taking sides about who screwed over who. Just as you can do what you want, your aunt can too with this strategic default. I don’t love banks, but if you can afford to pay the debt I believe you have an obligation to do so. If you can’t afford to pay the debt, then you can’t and the bank took a bad risk. I don’t know what it means that she can make the payment but she can’t save much money. If that means she is struggling, she has cut everything out and there is zero margin in her life, then she probably needs to get out of the house. But if she is going on vacations, leasing cars, going to starbucks every morning, and that’s part of the reason she can’t save money, then it’s a different issue.
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Jan 22, 2013 20:05
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Sophia posted:But then she doesn't get to live somewhere for free for 2 years which is the whole point of her doing this. I'm not saying you're wrong, and I'm also not saying that it isn't a shitheel thing to do, but she'll probably never go for this (or for paying rent while her nephew lives there) because it seems like in her mind the goal is less to get out from under a mortgage and more to scam a place to live for no money for as long as she can. How we handle money says a lot about us. Finances are a lot more complicated than discussing how Roth IRA’s work. How we spend money and on what is inseparable from our identities and I have absolutely no problem with this discussion of ethics. I agree that defaulting on a contract is not the same as theft. However the law looks at it, I believe intentionally defaulting on a contract and doing it in such a way to get two years of free rent *IS* the same thing as theft. Last year my roommate went beyond mere collecting things to becoming a hoarder and when I called him on it and told him to clean things up he stopped paying rent. (I own the house). Laws in Massachusetts drastically favor tenants and it took 4 months and two trips to court to get him out. Plus I was paying through the nose on legal fees. Meanwhile he is walking around like he owns the place and living there for free. Are you going to tell me that he didn’t steal from me because it was only breaking a contract? The right thing to do is if she really can’t afford it is to work with the bank and do a short sale.
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Jan 22, 2013 22:04
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Orange_Lazarus posted:edit: eh I'm tired of this derail, people have already spoken their minds about strategic defaults and we've already established that it's a bad idea to try and squat, either for ethical or the obvious practical concerns, your choice. Originally my intent of asking was to see if I left out any practical reasons why squatting would be a bad idea in my conversation with her last night and I received some answers, thanks. I've already said that this is not a derail, and I don't know why you equate strategic defaults with investing in oil or taking legal tax deductions. Going back to ethics, the bank already took a partial loss on their investment by doing the modification. There was something in it for them since they didn’t want to take an even bigger loss, but they certainly didn’t take this loss so the borrower’s niece’s husband could get a really sweet deal. I don’t believe in some mysterious karma bank where the world gives you back exactly what you put in. That said, just as I’ve said that giving money away benefits you as the donor because by thinking of others you carry yourself differently and you are more attractive to people and the opportunities they bring, playing fast and loose, and thinking you are going to get ahead by playing the system makes you repulsive to people. Even if they don’t know what you are doing on the side. I don’t know if we convinced you that your wife’s aunt makes poor decisions with money in spite of being a really sweet woman and that being her landlord is a crappy idea, but if we haven’t, I hope it works out well for you.
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Jan 23, 2013 17:18
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Orange_Lazarus posted:Because a strategic default is perfectly legal, just like commodity speculation. The argument I keep seeing from some is that even though a strategic default is perfectly legal it's unethical because it harms society, it harms the banks and it can potentially harm my neighbors. Well, commodity speculation is harmful to society as well because it inflates the prices of commodities, which negatively impacts everyone especially the poor. So shouldn't I as a truly ethical human being antagonize individuals in the stock-picking thread if they invest in commodities? I would argue that commodity speculation is useful for society in that it creates a fair market price. Oil is always the poster child of speculation, but what is the harm if speculators drive up the cost of an increasingly scarce fossil fuel and by doing so, encourage conservation, use of alternatives and reduce pollution and global warming. This is a derail so if you want to keep discussing speculation, send me a PM. A strategic default is when someone can make the payments but they don’t feel like it anymore, and that drives up the cost of my rate, your rate, the fees on my checking account, causes the banks to lay people off and me to be on hold for an hour when I need to call. It is not a victimless crime. quote:I wish this was true but it just isn't. You and I may find them repulsive but I'm fairly confident that the majority of American's do not. People that cheat the system literally run society and 49% of our voting population almost just voted in a guy that kept money hidden away in the Cayman's, somehow managed to get 100m into an IRA and paid a significantly lower tax rate than the majority of working American's, deducting such things as a dancing horse (as a medical expense) from his taxes. America loves cheaters. I can speak only for myself, not 49% of Americans. Again, speaking for myself, my tenants sometimes pay me cash and it would be the easiest thing in the world to not report it as rental income. I do anyway. Others will approach it differently. quote:Once again it wasn't a decision. She just said she was considering it and I told her squatting was a bad idea, then I asked BFC if there were any other reasons why doing so would be a bad idea in order to convince her not to do it. That’s good to know.
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Jan 23, 2013 18:26
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Spamtron7000 posted:Right. Because 51% of this country believes its citizens are lemmings - incapable of independent thought and reasoning and need to be protected from their bad decisions by their big brother. It's completely unreasonable for a poor citizen to actually have to read and understand how a loan works to accept funding for their $500,000 property. Banks are obviously the bad guys here because they lend money to people who otherwise would be unable to afford to buy homes. They are so evil they EVEN MAKE MONEY FROM IT! I’m not going that far. I believe there is a such thing as predatory lending and I believe the government is well within its rights to pass laws protecting people against themselves. If that’s socialism, that’s another discussion. I agree the aunt in question is not a victim of predatory lending. She already got a modification and the whole point of the make the aunt a landlord scheme is because he wants to pay a below market rate. The fact that you can get a 30 year mortgage in the 3’s tells me she has a pretty sweet rate.
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Jan 23, 2013 20:06
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Elephanthead posted:Maintain occupancy of the home until the sheriff physically removes you from the home. Anything else is crazy. If the bank wants the house they will give you what is called cash for keys to vacate before the sheriff gets around to throwing you out. The costs of throwing you out are included in the cost of the loan. You are not getting anything for free. If you are in a recourse state you are going to be paying anyway unless you get it discharged by a court. I don't see how using something you own and are paying for is unethical. It is up to the bank to assert its legal or negotiated possession. There are no morals in contract negotiation. I can't believe the number of people that think banks are some naive participant in the process that are just getting screwed by everyone else. Are you my old roommate? If someone lost a job and can't pay, I am on your side. Even if you did something stupid and you can't pay because of your own stupidity, I'm still on your side. Where I draw the line is if you can pay and you just don't want to anymore. I don't care what contract law says, I am not on your side. You are not Robin Hood stealing from the big evil banks and you are not a victim.
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Jan 23, 2013 20:29
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I know I encouraged this debate, but no one is changing each other's minds. Everyone gets to make a closing arguement/parting shot, but then that's it.
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Jan 23, 2013 20:55
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When I was just beginning the home buying process and exploring areas and figuring out what I wanted I was all idealistic about taking the middle man out of the process and I thought I could save money by dealing with FSBO. This was end of 2007 thru 2008 after the market peaked and things had come down quite a bit, but before the bottom fell out of the economy. Almost without exception the sellers priced their homes way high, like 2005 levels. Nothing was competitively priced and I ended up buying one that I picked out myself on the MLS. As it turns out it started out FSBO at $700,000 and when they couldn’t sell it 18 months later they listed it with an agent who started out at $575,000 and kept dropping the price. I paid $460,000. I’m all in favor of FSBO when the owner is willing to meet in the middle, not be stubborn about some mythical number that they think they deserve. Which is about 95% of them.
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Jan 24, 2013 22:02
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Zack_Gochuck posted:So guys, I just got an offer accepted on a place, now I need get some financing. Do people find brokers or banks better? If I get rejected at one bank, what are my chances of getting a mortgage at another one? I'd love to hear some people's personal experience. Yeahm SlapActionJackson's right. Virtually all mortgages are sold into the secondary market and they have to comply with Fannie Mae/Fredie Mac guidelines. When banks hold it in portfolio they charge more and usually do variable rates. Did you have financing lined up and something fell through, or did you put an offer in without financing lined up? If it's the former, usually offers are written in such a way that if finacing falls through you get any deposits back. If it's the latter, not sure what to tell you.
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Feb 20, 2013 19:10
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Spazzle posted:What are the tax implications of receiving financial assistance from my family to help with a house downpayment? Probably none for either of you. There are never tax implications for receiving money. As far as giving money, you are allowed to give up to $13,000 per year without needing to file a gift return, and anything above that isn't taxed until you hit a lifetime giving exclusion of $5,120,000.
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Mar 13, 2013 03:32
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Duct Tape posted:My roof is 34 squares, plus three 2'x4' skylights, and I'm switching from shake to shingles so I need to also install the plywood underneath. You will do way better if you can stay below 90%. You basically at 80% now, so that isn't an option, but you would do a lot better below 80%. A lot of places don't like to go to 90%, but some will. Almost no one goes above 90% and if they do it will almost be usury; so bad you would be better cash advance on the rest if you are a little short. Or pay cash, which is the best. How bad is it? Is this an emergency, i.e. leaking now, or something that you know is coming up, but your not an emergency yet?
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Dec 29, 2014 19:47
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I just wanted to be prepared for the worst-case scenario, but I suppose I'm jumping the gun until I get some more reasonable quotes.
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Duct Tape posted:5/12 pitch, based on the first contractor's measurements. I also thought 34 squares seemed rather high, even accounting for waste. The house itself is only 2600 square feet, though there are some odd outcroppings. If you can get a reasonable rate on an equity, something like Prime or not much over, or a fixed in the 4 or 5% range, that would be my first step. But if the value comes in low and can't do it, or you end up being stuck with something like 6%, you might need to suck up the higher insurance, and between you continuing to save, values increasing, and paying down the mortgage, hopefully things will align better for you soon.
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Dec 29, 2014 21:06
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Stefan Prodan posted: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. Stefan Prodan posted:I did not do it obviously, but yeah, it could just be that I got lovely loan people. Get a new banker. There are methods of calculating rental income, but it is common to count 3/4 of your gross rent toward your income and the full costs on your debt, or to use a Fannie Mae calculator that does almost the same thing, makes a few adjustments such as adding back in depreciation. This particular rental property won't add a lot to your income but it shouldn't be a negative. Also, anyone who actively advocates fraud you want to stay away from. He is going to be more likely to hide fees from you, lie to vendors too, and just be lovely overall. Your income is probably more likely than most to fluctuate so you should be putting more down and buying more conservative, and on your rentals not be highly leveraged, but
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Jul 26, 2015 17:59
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Leperflesh posted:Yeah, we've had this discussion. In theory, the cost of the buyer's agent is incorporated into the sale price of all housing, and therefore all houses cost 3% more to cover for it, and therefore it's not free to you, the buyer*. There is a sort of back handed way to get the 3% back but its potentially time consuming and dangerous unless you really know the market. That would be to get your real estate license, the requirements vary by state, but usually involves some classroom training at an accredited school and passing a test. It would set you back about $500 or so, but you would essentially be representing yourself and when the deal goes through the other side would pay you your 3% commission for bringing the buyer (you). But you could really gently caress it up big time if due to your ignorance you missed deadlines, etc
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Jul 28, 2015 03:43
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Epitope posted:I find all realtors, including ours, to be slimy and awful, but there's no way I'd want to do this without one. We tossed around putting in an offer on an FSBO, and the sellers wanted us to go without a realtor too. God that would have been a nightmare. I hope not all realtors are slimy and awful, but sadly a lot are. I bought my house 7 years ago and during the buying process I spent a lot of time looking at FSBO's thinking that this would be an ideal world where we would meet in the middle and I would save some and they would save some. This was in 2007 - 2008. I don't know if it would be the case now, but the market peaked in 2005 here and almost without exception all the sellers were trying to get the same price their neighbor got in 2005. The house that I ended up buying was $460,000, but in 2006 it was on the market for $850,000 by owner. As the market dropped they dropped too, but never enough. After about 2 years of that they gave up and listed it with an agent. Had they just gone with an agent when they wanted to sell it, listed it for a reasonable price based on real analysis and not emotion and a sense that they deserved a certain price they probably would have gotten at least $150K more out of the property.
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Jul 29, 2015 02:02
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DrBouvenstein posted:Got estimates for some basic contractor and electrical work, and while the estimate for a couple stair railings is about what I expected, hoo-boy, what I would think is basic electrical work is more expensive than I thought. If you already asked for and got approved for a $2500 credit, I would just leave it at that. It sounds like all the big stuff, roof, foundation, plumbing is all accounted for. Even if the smaller stuff goes over you still have control of the work and the bulk of it will still be covered for. That estimate sounds high, you can get another one but unless I am missing something, we are talking a few hundred bucks either way, and compared to everything else that is a rounding error.
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Jul 29, 2015 19:32
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Economic Sinkhole posted:Every one of those things is something you can do yourself with parts from Home Depot. If the town finds out he did the work they can make him rip out the work and have it redone. He has a sellers concession. Just let things go through the normal channels
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Jul 29, 2015 20:45
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OSU_Matthew posted:I don't see anything in there that screams "I need a permit". Only thing it says to me is You're probably right. I tend to get conservative and dealing with a municipality that cares about stuff like that put me in cocoon mode.
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Jul 30, 2015 05:00
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for miscellaneous outlets at home depot and fifteen minutes to watch a few people replace an outlet on YouTube and de-mystify the great magical black box of household electricity.
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OSU_Matthew posted:^^ Don't do what you think will make you money, just fix what will make your life better, and don't have the expectation you'll get your money back out of anything you do. A lot of stuff is really cheap, easy, and personally satisfying to do on your own. Also, just think how badly dated granite countertops will look in ten years time and how the future occupants of your house will be itching to tear it out for the new glamorous kitchen hotness. Exactly. Depending on what you do you will get 30% to 65% back out on price, but whatever you do, pay cash for it. After you have an emergency fund. Before then you can paint, decorate and get area rugs. Too many people justify borrowing money on expensive upgrades thinking they will pay for themselves, and next thing you know you will be one of those aforementioned people who have been in their house for 20 years and have $5000 of equity. Personally I think granite can look really nice, but I see cookie cutter renovations where they put it in to say they have it too. One thing I don't understand is why people get hardons over stainless steel appliances.
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Jul 30, 2015 17:53
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Spamtron7000 posted:OK so after living here for nearly 4 years I get a letter from the family in the house behind me asking for my cooperation in addressing a tree on my property whose roots are "creeping up on their slab". My back yard has a steep upward slope (probably 30 degrees) and there are 3 paper trees probably 15-20 feet from the edge of my property. The house in question sits on the plateau above my house (their slab is probably at around the same altitude as my roof. quote:Although adjoining landowners have almost an unfettered right to trim encroaching limbs, branches and foliage, that is not the case with tree roots. If roots encroach under adjacent property, you can sever the roots but only if the roots are in fact causing damage and then only if done reasonably (which may mean by a professional). If the tree roots of an adjoining landowner do in fact cause damage and the encroached upon landowner acts reasonably to sever the roots causing damage, the owner of the encroaching tree is liable for the actual out-of-pocket expenses incurred as a direct result of his tree's encroaching roots. This looks like the key clause here. I would ask to see what actual damage is happening. The mere presence of roots does not automatically mean they are damaging. If there is damage to their slab then you would be on the hook for having the roots pruned back. If they can't prove that their slab is being damaged, then not your worry. What is this about a copper nail? If only trees where that easy to kill....
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Jul 30, 2015 18:52
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Spamtron7000 posted:Since I'm stuck at home taking care of a sick toddler I figured I'd take a picture to show you all how awesome these loving trees are. This is from my bedroom window. That house in the background is the one in question. gently caress my ice plants are all dead and the hill needs some attention. They aren't even that close to your neighbor. Are they talking about a concrete slab that the house is built on? I'm not there, but no way those roots are causing damage to it. Unless it is documented I would stand my ground and pay nothing
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Jul 30, 2015 20:27
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Stefan Prodan posted:What's the gimmick with the no closing cost refinance loans I hear advertised on the radio? If they can offer a total thing that ends up being a smaller monthly payment is there any downside to doing it? There are closing costs, but they would be built into the rate and not paid by you, so the rate might be a bit higher than a regular loan that you have to pay closing costs. Just compare all your options, do the math, and see what will be the cheapest in the end, but it's not a gimmick or a scam.
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Aug 2, 2015 00:14
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QuarkJets posted:What brought you from 4.75 to 4 in the first place, though? The GFE's will estimate your closing costs and it will have the APR. But you will have to do a bit more math than that. It depends a lot on how long you will be there. Remember you are not comparing the current 4.75% to the proposed 4.25% no closing cost, but the 4.25% with the 4% closing cost loan. Compare the payments and see how many months it will take to recoup the closing costs. If you don't have the ability to pay the closing costs out of pocket, see if they will roll them into the loan balance. Say your loan balance is $200K and closing costs are $2K. You would compare the payment of $202,000 at 4% vs the payment of $200,000 at 4.25% The longer you think you will be there the more important rate becomes.
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Aug 2, 2015 01:49
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Leperflesh posted:Similarly: while buyer's agents do have a direct immediate financial incentive to get their clients to both pay a high price and close quickly, in the long term, realtors depend a great deal on reputation and word-of-mouth for their business. Giving your customers reasons to have a lot of remorse over the deal you pushed them into is counterproductive to establishing a good reputation among your customer base. So while there are plenty of horror stories of realtors with short-term perspectives putting their own commission size ahead of their clients' best interest, there are also plenty of realtors who recognize this probably hurts them in the long run... and others who are just actually decent human beings not willing to take advantage of their clients. I agree with this. At this point I have done more rentals than sales, but the other thing you can do to increase your chances of getting good service is to be a good client. A huge part of this means working with just one broker. They are working for a commission, but if they see you are serious and something will eventually come of their efforts a good broker can work miracles, let you know as things come on the market, introduce you to areas you never thought about, and they can be worth their weight in gold. But if you are a bad client, slow with communication, not really serious and just sort of window shopping, misrepresenting yourself, or jumping around to whatever agent you see on Zillow, then even a good, ethical agent is going to be half-assed about things.
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Aug 14, 2015 19:59
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Bastard Tetris posted:We're in San Diego, and this rental is in coastal north county, vacancy rates are extremely low. How far is the coastal north county from you? If the "profit" is the difference between the mortgage and the projected rent, then sell for the reasons slap me silly said. But if this is a true profit after you factor in maintenance, repairs, and the cost of your time, but if it is a long distance rental, then you should sell it no matter how good it looks on paper.
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May 3, 2016 05:16
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wyoak posted:A friend of mine just bought a house on an 80-10-10 mortgage. I, being the renting type, was unfamiliar with those - it sounds like the second 10% loan is a HELOC, and lots of stuff I'm reading says it's an interest-only loan. How long is that 10% equity line interest-only generally? Do they usually require a balloon payment at the end or does it eventually enter a principal repayment period? Maybe you refinance before that to get rid of the HELOC, although that seems like a pain with two loans on the same property. It can be a good product. You can get a conventional mortgage with as little as 5% down. Someone putting down 10% is still coming up with tens of thousands of dollars of their own money, so it's not like the banks are getting people highly leveraged. But the main benefit is that the borrower avoids PMI.
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May 4, 2016 03:40
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