Home buying thread

There was another one before that, i agreed with you on the 15 year idea.

You'd be one wealthy street urchin.

Cad_sl said:

I did pay off my first house in like 2 years. But it was like 180k. It seemed nice at the time but in retrospect if I had bought $150k of VTI in 2003....

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OK, and I get it. But when that's the case why buy a house at all? If you're future focused and investment savvy, why buy a house?

To attract a mate.

Cad_sl said:

Didn't make any money on my first house because it was a tract house. I'm already up about $500k on this house. I learned since then.

Also, gotta live somewhere. Fairly difficult to rent a 5 bedroom place without the cost being stupid.

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Based on what you said in the Big Short thread are you at all concerned with the current market? I don't mean to be cynical but you sound like you're letting this outrageously bullish market make you cocky.

a_skeleton_03_sl said:

That's the rub. Finding a house to live in that I can do what I want with and do what I want in is difficult.

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That is exactly the rub. It's what makes buying a house an investment in personal well-being and happiness rather than a financial investment.

Cad_sl said:

Personally concerned, no. Because I bought at the very bottom of the local market (by luck, really, but it worked out). Even in the event of another crash, prices will just reset to around what I paid, most likely. Which is fine.

Also I'm planning to stay here until my last kid graduates high school... which is about 15 more years. So I have plenty of time for it to crash and inflate again before I need to worry.

My housing expenses (PITI) are also only like 19% of my bring home, neverminding my wife's income... so I'm good either way.

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I know you're a smart guy, I just wanted you to fully disclose for the sake of would be investors who hold your opinion in high value in such matters. I think that trust in your opinion isn't unwarranted but wanted you to elaborate because you were almost making it sound like the kind of success you've seen is a sure thing when market forces are completely outrageous and have been for most of your (and mine) adult life.

I bought the 2 houses in my name and paid cash. Of course they were probably a lot cheaper than the houses most of you own/live in. I'm really conservative in that aspect. I grew up in the petro chemical bust of the early 80's and I knew families who lost everything. I like having a house paid for. Sure it doesn't come out ahead money wise, but it's nice for me peace of mind wise.

I found lots of 5 bedroom houses in Stone Oak and Garden Ridge just north of San Antonio when I was looking. But I really didn't want to pay $18k a month in rent. Blew my mind that they had multi million dollar homes 1/4 mile from our shop. Normally the kind of shops I work with are in the very worst of the worst part of town. President of the company told me a house was for sale just down the road I could look at. I told him I would need a raise to buy a $4.5 million house. But he said you can save a lot of gas money since you could bike or walk to work.

I think I'm going to give this lady the info she requested - W2's, tax returns, income verification, etc. I assume it will be a hard credit check which I never like, but looking over our mortgage we might save a ton of money. Our interest rate is absurd (4.75), and while I'm not exactly sure what rates are right now I think we could drop 1% or so, plus if she can get rid of PMI that will be big savings for us.

I'm a little leery of re-financing because I've never done it and don't know what costs are associated with it - in a typical refinance, what do you need to pay out of pocket? Closing costs? Any title/escrow stuff? Inspection?

Noodlemod_sl said:

I think I'm going to give this lady the info she requested - W2's, tax returns, income verification, etc. I assume it will be a hard credit check which I never like, but looking over our mortgage we might save a ton of money. Our interest rate is absurd (4.75), and while I'm not exactly sure what rates are right now I think we could drop 1% or so, plus if she can get rid of PMI that will be big savings for us.

I'm a little leery of re-financing because I've never done it and don't know what costs are associated with it - in a typical refinance, what do you need to pay out of pocket? Closing costs? Any title/escrow stuff? Inspection?

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I paid nothing out of pocket. All the fees got rolled into the mortgage -- for better or for worse. But removing the PMI and getting a slightly lower rate I saved ~$450/mo so I wasn't going to stress out too bad.

Closing costs will be 2 or 3k and if he knocks off a point on a 200k loan he'll save 120 a month so 2 or 3 years? You have to remember cad, some mortgages are less than 7 million dollars.

The only problem is rolling it into the mortgage you're paying interest on it for however many years the mortgage is.

I just want to make sure I know what I'm getting into.

Are there any major drawbacks in my scenario? I mean with me having PMI and an absurd interest rate.

Noodlemod_sl said:

The only problem is rolling it into the mortgage you're paying interest on it for however many years the mortgage is.

I just want to make sure I know what I'm getting into.

Are there any major drawbacks in my scenario? I mean with me having PMI and an absurd interest rate.

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Getting rid of the PMI alone is worth it unless you plan on moving soon. My PMI was stupid like $140/mo or some shit. Combined with knocking that off and getting a better rate it seems like a logical decision to me.