Rent Vs. Buy housing
- Thread starter Porkchop
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Vinen
God is dead
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So fucking nervous. About to enter P&S for a 700-800k house. Fiance and I can easily afford it... just scary as shit thinking about how much we will instantly go in debt upon closing. (I've never been in debt before outside of Credit Cards which I payed off each month... paid for my cars in cash, etc)
Cad
scientia potentia est
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Might seem like a technicality, but a note on a house and a "pure" debt (like credit cards or something) aren't the same thing, your debt is backed by an asset worth more than your debt. Realistically, your financial position isn't changing at all. You're acquiring an asset worth X, acquiring debt worth X - X(.2) or so, and losing cash worth 0.2X. Your net worth stays close to the same, assuming your house is worth what you're paying. If you're getting a deal on the house, you're probably making money over a 5-10 year span by buying it. Don't be nervous about that.
Be nervous about all the shit you're going to buy to put in it/fix it up that WILL put you in debt.
/agree with Cad. Now is really the time to buy, big time. Debt be damned, get in and get it done. I wish my wife and I had waited like..a year or two before buying our house. We're basically underwater at this point on the mortgage, but real estate values are coming back so in about 10 years or so we should actually be able to sell this house and MAYBE break even, or have some positive equity (ideally). A family friend bought a 600K house that was foreclosed on for about 350K, I wish to god I was on that deal.
So I am setting up showings for over the weekend and have a quick question for the people out there that are either real estate agents or have recently bought a house. Is it worth setting up showing / going to look at a house that is considered, "Active Contingent"? It is my understanding that the house with that label has had an offer placed on it but it isn't final. Is that correct?
Noodleface
A Mod Real Quick
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If it's close its worth looking at I'd say. If it's far away I wouldn't bother. Has an offer that is contingent on something, maybe an inspection.
Are you house hunting solo or with the wife? Don't let her fall in love with something you can't buy. Otherwise every other hosue you look at will be compared to that.
I am single so it is just me. Still undecided if I should just pay more and live by myself or get a roommate (someone I know, fuck craigslist)
Porkchop
Mr. Poopybutthole
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If you can afford it, live by yourself. Fuck room mates.
Also, thread update, never did end up buying a house. Tried to, went through the whole process, fell out in underwriting, two weeks from close of escrow. Big fucking headache.
Gravel
Mr. Poopybutthole
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My wife and I are hoping to close in the next 2 weeks, but I'd say that yes we would consider one. I'm assuming you can hop on Zillow or somewhere else and see it, so you probably like it enough to look at. We went into it looking at houses we had no intentions of buying just to get a good idea of things we liked and didn't, and to get a better feel for the market. Open house weekends were really good for this.
I find this somewhat comical, as we got a 3.25% interest rate lock for our house. Guess money isn't getting more expensive after all?
Stock market also did massively better than housing. So I guess it wasn't the time to buy after all...
Then again, do people ever say "now isn't the time?" Seems like there's always this fear of housing prices just shooting to the sky and you have to get innow, now, now!!!
Palum
what Suineg set it to
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Palum
what Suineg set it to
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Active Contingent usually means it is active (as in, no accepted offers) but the sale is contingent on another issue (seller finding another house, approval for loan takeover, approval for shortsale, etc.). It is not necessarily 'bad' but often it's going to add a bunch of complication unless you are pretty open with timeframe.
As soon as an offer is accept it goes to Under Contract - usually they also list it as UCB which is Under Contract accepting Backup offers. UCB homes I'd typically avoid unless you were already interested and/or can get full deets from the selling agent.
AladainAF
Best Rabbit
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Depends, how many points did you pay? I mean, I could go right now and get a 3.25% 30 year fixed loan too for about 3.0 points. I got a 3.25% 30 year fixed on my primary residence at the end of 2012 ... for 0 points. I guarantee you that you did not get a 3.25% 30 year fixed mortgage anytime this year for zero points.
So yes, money is getting more expensive.
Cad
scientia potentia est
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The lowest rate on bankrate right now for a 30 year fixed is 3.88, so you want to source your 3.375 with 0 points loan?
AladainAF
Best Rabbit
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Yeah no shit, I'd love to see how in the hell you got that. That screams something like 10/1 ARM or something to me. 3.25% I locked in at the perfect time (Dec 2012) when rates were at their lowest. They have gone down a bit from last year, but they are still 0.5-0.75% higher than that time, for no points.
AladainAF
Best Rabbit
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I have mainly investment loans, so sadly those are slightly higher than any primary, but last year I got a 15 year 25% down investment loan @ 4% no points, and one this year 25% down at 3.75% no points, and another this year at 25% down 3.6125% 0.5 points.
I've debated moving my primary into a 15 year, but shit 3.25% 30 year note is fucking cheap.
I've debated moving my primary into a 15 year, but shit 3.25% 30 year note is fucking cheap.
Gravel
Mr. Poopybutthole
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Not the greatest image because I had to chop it up from a PDF to redact it. The $599.87 is a lender credit.
Edit: The loan we locked in, for comparison. Points are at the bottom left.
Wife and I both have 805 credit scores (not sure how/why they're exactly the same) and our only outstanding debt is a car loan with about $8k left on it. We've got $30k in liquid cash, and another $70kish in less-liquid funds. Our combined income is $111k. I don't know how much any of that really effects our loan as much as it did, but I'm not complaining. $5k in closing costs covered by the seller, 30 year VA fixed, $0 down.
Edit: The loan we locked in, for comparison. Points are at the bottom left.
Wife and I both have 805 credit scores (not sure how/why they're exactly the same) and our only outstanding debt is a car loan with about $8k left on it. We've got $30k in liquid cash, and another $70kish in less-liquid funds. Our combined income is $111k. I don't know how much any of that really effects our loan as much as it did, but I'm not complaining. $5k in closing costs covered by the seller, 30 year VA fixed, $0 down.