Home buying thread

Palum_sl said:

That may well be true, but what about the seller and the seller's agent? If that's something they were required to disclose and they should have known then you could at least go after them got the price of flood insurance.

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There isn't anything to disclose, his discount lender fucked up the house isn't in a flood zone.

Oh I read that in reverse as in the original lender didn't read the current map.

Are home valuations somewhat arbitrary? My valuation come in for my refi and it is about 25k more than I paid for the house 4 years ago and most houses on my block similar to my house go for around or just under 200k but my valuation came in at 215k. My brother says even if the house wouldn't sell for that much it decreases my LTV which should get me a better rate? I'm horrible at this kind of banking/fiscal stuff.

Yeah it just seems like they comped my house then added like 10%. Though I suppose my neighbors across the street have a similar floor plan and sq footage and their house went for like 210k. I just look at the sale prices of the homes in my neighborhood but I don't actually look at the interiors possibly mine is finished better than the ones going for ~190k.

Tenks_sl said:

Are home valuations somewhat arbitrary? My valuation come in for my refi and it is about 25k more than I paid for the house 4 years ago and most houses on my block similar to my house go for around or just under 200k but my valuation came in at 215k. My brother says even if the house wouldn't sell for that much it decreases my LTV which should get me a better rate? I'm horrible at this kind of banking/fiscal stuff.

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Might get you a slightly better rate but I wouldn't refi unless you're doing it to knock out PMI (thanks to the increased valuation), or are shortening your term.

What is your current term and how much time do you have left on it? If you have a 30 year currently and have been paying it for 5 years and then refi to another 30 you're adding a bunch of interest back onto your payments because of the amortization that accompanies mortgages. Even if you get a much better rate (1% or so) you could still end up paying more in the long run.

Example. Say you pay $1500/mo now and have 25 years left on your mortgage. That's a total payment of $450,000 to finish out your loan. Say you refi to a better rate and cut that payment to $1300/mo but it's a new 30 year term. That's a total payment of $468,000 and that's not even factoring in refinance costs.

Tenks_sl said:

Yeah it just seems like they comped my house then added like 10%. Though I suppose my neighbors across the street have a similar floor plan and sq footage and their house went for like 210k. I just look at the sale prices of the homes in my neighborhood but I don't actually look at the interiors possibly mine is finished better than the ones going for ~190k.

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I don't think they take into account whether you have hardwood and updated appliances when doing comps (i.e. updated/nicer interiors). They just look at age of house, livable square footage, lot size and find other similar homes in the area and see what they sold for recently.

Khane_sl said:

Might get you a slightly better rate but I wouldn't refi unless you're doing it to knock out PMI (thanks to the increased valuation), or are shortening your term.

What is your current term and how much time do you have left on it? If you have a 30 year currently and have been paying it for 5 years and then refi to another 30 you're adding a bunch of interest back onto your payments because of the amortization that accompanies mortgages. Even if you get a much better rate (1% or so) you could still end up paying more in the long run.

Example. Say you pay $1500/mo now and have 25 years left on your mortgage. That's a total payment of $450,000 to finish out your loan. Say you refi to a better rate and cut that payment to $1300/mo but it's a new 30 year term. That's a total payment of $468,000 and that's not even factoring in refinance costs.

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I am dumping PMI. My payment is going down by around $400/mo with the refi. I also don't really plan on staying in this house more than a few more years. My current principal/interest/escrow is ~$1500/mo and the new payment is just a shade higher than 1k/mo. I'm also getting about 0.6% (this was before the valuation or anything, just a locked in rate) better than my current. I'm just trying to get the monthly payment down a bit so I can slam more cash into the principal (I currently add 1k a month to principal to get out of the PMI zone) or save some cash for a down payment on a different house. I bought the house when I wasn't married and making ~30k less than I make right now (so total I have ~90k more per year than when I bought the house) so the payments are pretty easy. The only reason I'm actually refinancing is to shut my fucking parents up who everytime I saw them they told me to refi the house.

Yeah my loan guy told me if I just pay what I'm paying now (minus the extra 1k principal) the loan would be done in 16 years.

Cad_sl said:

You can always refi and just make the same payment as you always did which will finish your loan faster than the 25 you had left because less of your total payment is going to interest. Nobody is making you pay only the lower payment if you are worried about amortization.

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Of course but most people don't actually they do that. They just spend the extra money on other stupid shit. Definitely worthwhile if you have the discipline to do it, but then again I'd refi to a shorter term that comes out to a similar or equal payment just to make sure I don't get complacent. In fact that's what I did when I refi'd in January. Went down to a 10 year term.

EDIT: Tenks you should ask the loan officer what kind of rate you can get on a 15 year term and what the payment would be. You should be able to get an even better rate on a 15 year mortgage and if you're gonna be paying that much anyway might as well save yourself some money in interest.

General question for those of you who have recently bought or sold homes...

Is it beneficial when trying to sell your home to be MORE updated (new bathrooms, new kitchen, new floors, etc) than the vast majority of homes in your neighborhood...or are most people going to look at the comps and see that you are trying to sell your home for 20% more than everyone else in your neighborhood and either not even bother making an offer, or try to low-ball you.

The reason I ask, my neighborhood was built 20-25 years ago and I've been keeping an eye on Zillow for several months now, and it seems like the vast majority of homes that come on the market still have those 20 year old finishes (light colored wood cabinets, white/black appliances, carpeting in bathrooms, corner sauna tubs, etc). I don't know if we would be better off selling as-is, similar to most of the others, or if spending $20-$30k to redo our bathrooms and kitchen and floors(replace carpet with wood or laminate) would pay off, as we would then need to price our home WAY above everyone else in the neighborhood. (we're talking 150-200k homes here, so the reno would likely be 10-15% of the total home value right now).

I honestly haven't seen a single home in our neighborhood come on the market that is completely updated...one bathroom might be, or the kitchen might be but nothing else is, etc.

Just how important are comps for setting the pricing in a neighborhood?

I'd be nervous about pricing yourself out of the neighborhood if you update too heavily.

You won't make the money back on remodeling in most cases and definitely not in yours. It will help you sell the house faster if you price it in the same range as all these comps that aren't updated but that's about it. The only time I'd consider it is if you NEED to sell and move ASAP and don't mind eating the loss to help sell the house faster (and that's only if the market kinda sucks for sellers and there's low demand in your area).

If you can come up with some cheap shit to make yours stang out that's the way to go. I definitely wouldn't get into any major overhauls.

Dream property came on the market recently but it is, at the very least, 70k overpriced. It last sold in 2010 for ~350 and it is listed for 500. It doesn't list any recent reno and the interior is nice but nothing jaw dropping so I doubt any major work was done. Since realistically 425 or so would be my max I'm not even going to try and schedule a tour or anything until they drop the price so I can tell if they're even at all interested in selling.

Offer them 351.