Try to either pay 20% down or get two loans a 20-80 loan so that you won't have to pay the PMI which is an extra $65-$80 a month that goes into your mortgage only you'll never see it again. You'll pay that amount every month until you own 80% of your home.

 

I don't know if they do these anymore. With our first house, we did an 80/15/5 to avoid PMI as we didn't have the 20%. With our 2nd house, they said they no longer did those, and that was right before the housing market tanked. However, if you're going to buy a house, do whatever you can to avoid paying PMI.

My advice to anyone looking to purchase is buy well within your means and purchase it on a 15 year mortgage. You will build equity faster this way. Then you can start trading up from there to your dream home as the years go forward. The big mistake many make is going for their dream home right away and getting over extended, especially over the past few years when credit was too easily available.

 

Same with buying a car. Everyone wants to go out and buy that shiny new car and credit has been so easy over the past few years people got upside down on leases and loans. Save up, pay cash for a used car, drive it into the ground while you are saving for the next one. As you save money for that next car, don't buy new. Eventually when you have saved enough, buy 2-3 year old vehicles you pay cash for. It is a beautiful life when you are debt free.

Same here. I'm getting married in October and I have a good job. It seems like the right time but I'm having trouble making a decision.

 

I desperately want a garage :lol:

 

If any of you guys live in Lexington PM me I have a nice 3 BR 2 1/2 bath townhouse with a garage you may be interested at a great price.

My advice to anyone looking to purchase is buy well within your means and purchase it on a 15 year mortgage. You will build equity faster this way. Then you can start trading up from there to your dream home as the years go forward. The big mistake many make is going for their dream home right away and getting over extended, especially over the past few years when credit was too easily available.

 

Same with buying a car. Everyone wants to go out and buy that shiny new car and credit has been so easy over the past few years people got upside down on leases and loans. Save up, pay cash for a used car, drive it into the ground while you are saving for the next one. As you save money for that next car, don't buy new. Eventually when you have saved enough, buy 2-3 year old vehicles you pay cash for. It is a beautiful life when you are debt free.

 

I'm not sure I agree with that. There's nothing wrong with starting out with a 30-year mortgage and once you find your financial situation improves, simply start adding additional payments. Once you are locked into a 15-year payment, you obligated to make that higher payment. Additionally, and especially for those just starting out, this much higher payment will greatly limit the house you can get into. Obviously, it is a poor decision to spend every available dollar on your mortgage payment to get into a larger home, but for a person in a stable career that reasonably expects his/her income to continue to rise, I wouldn't be afraid of a 30-year note to start. Hopefully after a few years you can re-finance into a shorter term mortgage or get a 15-year mortgage when you buy your next home.

I'm not sure I agree with that. There's nothing wrong with starting out with a 30-year mortgage and once you find your financial situation improves, simply start adding additional payments. Once you are locked into a 15-year payment, you obligated to make that higher payment. Additionally, and especially for those just starting out, this much higher payment will greatly limit the house you can get into. Obviously, it is a poor decision to spend every available dollar on your mortgage payment to get into a larger home, but for a person in a stable career that reasonably expects his/her income to continue to rise, I wouldn't be afraid of a 30-year note to start. Hopefully after a few years you can re-finance into a shorter term mortgage or get a 15-year mortgage when you buy your next home.

 

I agree. :thumb:

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Same with buying a car. Everyone wants to go out and buy that shiny new car and credit has been so easy over the past few years people got upside down on leases and loans. Save up, pay cash for a used car, drive it into the ground while you are saving for the next one. As you save money for that next car, don't buy new. Eventually when you have saved enough, buy 2-3 year old vehicles you pay cash for. It is a beautiful life when you are debt free.

 

For clarification, one of the reasons for a lease is to avoid being upside down. The leasing company loses out if the value of the car plummets - not the consumer.

 

Secondly, I partly disagree with your car purchase advice. Buying a used is car is, indeed, the way to go. However, many people need a car for their actual job because they are out on the road and often seeing customers. In that case you do not want to be pulling up in a $3,000 car. Its bad for your income. If you don't need a car for work then your advice is prudent.

If you're not comfortable with buying a home, don't buy a home. Its that simple. Don't let an incentive force you to rush your decision.

 

:thumb:

 

Also, anybody who is upside down on their mortgage right now has effectively flushed all of their mortgage payments down the drain. No different than renting but you are still obligated to pay money.

 

Houses may be cheap, relative to prices two years ago, but it still has to make sense for the buyer/borrower. It is very easy to be a slave to a house/mortgage and when you want to leave it is not as easy as terminating a lease.

I have been in the Mortgage business for 10 yrs and I work for a big bank so if anybody has specific questions just PM me.

 

I will tell you that now is a great time to either purchase due to the incentives or refinance. Many people do not know that they can refinance their Freddie Mac/Fannie Mae loan under the H.A.S.P program even if they are upside down on their home. If you have equity in your home you can also take advantage of lowering your rate under this program. It is not just for those under water. I am consistenly taking people from 6% or higher rates and locking them at 4.99 to 5.25% and saving them a ton of money or shortening their mortgage term under this program. Most times it doesnt require an appraisal to be done or income to be verified.

 

The Freddie Mac program pulls an automatic valuation on the property and as long as it is within a certain % it eliminates the appraisal process. There are other stipulations but these are the easiest streamline refinances I have ever seen in the business and they are out there to stimulate the economy by freeing up cashflow for customers.

 

Like I said, PM me if you want me to help you out with letting you know if you have a Freddie Mac/ Fannie Mae loan and whether or not this is for you.

I'm not sure I agree with that. There's nothing wrong with starting out with a 30-year mortgage and once you find your financial situation improves, simply start adding additional payments. Once you are locked into a 15-year payment, you obligated to make that higher payment. Additionally, and especially for those just starting out, this much higher payment will greatly limit the house you can get into. Obviously, it is a poor decision to spend every available dollar on your mortgage payment to get into a larger home, but for a person in a stable career that reasonably expects his/her income to continue to rise, I wouldn't be afraid of a 30-year note to start. Hopefully after a few years you can re-finance into a shorter term mortgage or get a 15-year mortgage when you buy your next home.

 

There is truth in what you say for sure. I started out in a 30 year mortgage on my first home myself. I have always regretted that. If you have the discipline to add the extra payments to equity in a 30 year mortgage, then the lower payment and flexibility in the budget are nice - especially for the young first time home buyer. But if you can afford to get into a decent home using a 15 year mortgage, I believe it is better to sacrifice a little in the home and get that 15 year mortgage. When you go to that next home in 5-10 years, you will love the extra equity accumulated in the 15 year mortgage. But it all depends on your individual circumstances.