Home Buying & Real Estate Thread

[crcballer55]

 
@crcballer55  Okay thanks that makes a lot of sense. One last question , how do I figure out what my break even point is for the loans? 

I haven't heard anyone bring this up.

@Supermanblue79  Thanks I have heard about all of the free upgrades you can get the builder to throw in. I will be trying to get as much as possible out of the builder. I will have to look into other warranties for the house.

@mr jordan04  Thanks I will definitely do that. This mortgage process has so many things I have to look out for its crazy.

Take your monthly payment from each GFE plus any fees and expenses. Say the Payment for one is $1500/mo with no upfront fees, but another is $1450/mo and $1500 in upfront fees, then your breakeven for the second loan will be $1500 divided by $50 and you'll get a breakeven of 30 months before that one offers more cost savings than the $1500/mo no fee loan.

 

[crcballer55]

@crcballer55 hey bro always appreciate the info youre passing along. My question is i'm hoping to get an FHA loan by next year. Trying to do the first time homebuyer fha loan but my credit is currently at 610 but i'm hoping by this time next year i could be at around 620+. What would you suggest for my fico to be at to qualify for the lowest possible down payment?

Also do you have experience with state employees getting home loan assistance? I currently work with la county but have an interview for a state position and was reading they offer home loans.

FHA just lowered their upfront fees, but it's still a pretty expensive loan. Why is your credit so shot? Why do you think it's only going to increase by 10 points over a year? With an FHA loan, you can qualify for a 3.5% down payment no matter your credit score. But the lower your credit score, the higher your payment will be with any loan. If I were in that situation, I would consider buying if my score were closer to the 700 range. Then you'll qualify for slightly lower rates.

For a conventional loan, PMI works in increments of 5%, so if you put down 15%, you're going to pay less in PMI than 10%. If you put down 10%, you'll pay less than 5%, etc. since you have more skin in the game you're less of a risk of default to the lender.

I'm not sure about all the state programs available except for down payment assistance. And with that, stay away from CHDAP! It's a second lien against the property, but you can't refinance the first without either rolling in that one or paying it off and the interest rate when I checked several years ago was still pretty high by comparison.

 

[Los Angeles]

let my pops and sister use my name to co-sign car loans, which both got repoed. I repeat to the younger cats lurking in here, NEVER let anyone even family use your credit

Realistically, i hope to be at around 650-670, i was at 580 maybe 6 months ago and buckeled down. Its hard bros got my wife in nursing school, with a toddler and still able to live comfortably. Hoping to really tighten things within the next year.

I just read about CHDAP :x good lookin'

 

[crcballer55]

let my pops and sister use my name to co-sign car loans, which both got repoed. I repeat to the younger cats lurking in here, NEVER let anyone even family use your credit

Realistically, i hope to be at around 650-670, i was at 580 maybe 6 months ago and buckeled down. Its hard bros got my wife in nursing school, with a toddler and still able to live comfortably. Hoping to really tighten things within the next year.

I just read about CHDAP

good lookin'

Sorry to hear about that. Ya, basically the rule of thumb is if the professional lenders won't touch someone you shouldn't either. It's not because they're mean, but because they know that more than likely the person is going to default.

When will she be certified. I know there's a program for teachers, military, firefighters, police, doctors, etc. called Homes for Heroes where basically participating Realtors (and possibly lenders) will rebate a portion of their check back to you at closing as a "Thank You".

 

[mr jordan04]

Los Angeles I text you [emoji]128545[/emoji]
But I actually did conventional with only 5% down. A lil more than FHA but I can get rid of the PMI sooner. Isn't PMI on an FHA loan 10 years now? I thought I remember somebody say that

 

[slicknick951]

Great information in here.

Right now im taking a step back to get on the right path. Moving back home with moms for a couple months while i build a bigger down payment and look for a co-op building.

I know a lot of these programs don't apply to co-ops but does anyone know of anything that I should look into?


Misc stats if they matter

Credit score is currently around 740-750 (Should go up when i shop loans)

Looking to put down at least 15% and have a little emergency fund once all is done.

 

[crcballer55]

@bright nikes I text you [emoji]128545[/emoji]
But I actually did conventional with only 5% down. A lil more than FHA but I can get rid of the PMI sooner. Isn't PMI on an FHA loan 10 years now? I thought I remember somebody say that

That's another big difference with FHA. If you only put down the required 3.5%, you're required to pay MIP for the life of the loan, which can run .85% on a 30 year.

 

[capital sb]

crcballer55 Thanks for the clarification. I will use that when deciding which loan to go with.

I am trying to avoid PMI at all cost, which is why I am looking into the MMP program, Navy Fed, and NASA loans. MMP allows you to get their best interest rate on a conventional as long as you have the minimum credit score of 640. I am afraid that NFCU and NASA will hit me hard with interest due to my current score, but I will still apply and compare all 3 loans.

I am working hard to get my score as high as possible by mid June. My credit score should raise by 30 points by paying down my cards dropping my util from 46% to 26% (used myFico simulator). This should help me get better rates just have to stay disciplined.

 

[dont be a menace]

Get pre-approved before you start looking. Don't "hope" for something, find out what you can actually afford so you don't get your hopes up.

Don't be afraid to rent. Don't think of it as throwing your money away so long as you're living frugally and have a plan and timeline to buy. Don't just jump in because rent is crazy. Buying too early can be just as dangerous if you don't have adequate reserves.

After getting pre-approved, look for a Realtor who knows what they're doing. Only a handful of Realtors really know the business inside and out and offer a quality level of service. Don't just pick someone who will rebate a portion of the commission. Although that sounds tempting, the ones that generally do that are the ones most desperate for the business. Somewhere like Yelp or Zillow should give you a good feel. And don't be afraid to interview 2-3. Generally you get a good feel of what they do compared to others and who you would like working with during the process because it WILL be very stressful. Especially during the week or two in the middle of escrow. If you're open, also have them refer a lender to you too. It probably won't be the cheapest, but since they work together all the time, there is a level of trust and knowing the Realtor refers them business based on their performance and how the lender takes care of their clients, there is an incentive to close the loan on time instead of the chop shops like Quicken or Lending Tree. Not that they aren't good, but they make their money on volume, not quality.

On that note, interview 2-3 lenders too so you get a good feel. Your Realtor can tell you if any of them are hacks.

was just reading this and couldn't agree more.

been crazy these past few months for me and my fam, the house we're renting in was foreclosed so we're in the process of looking for a new place. either renting or buying.

the only realtor we knew was my dad's when he bought a house a few years back so we went with her. We told her our info and how much downpayment we had and our criteria for a house, which was it has to be in SF or possibly DC but close to SF. but nah, she kept pushing for condos since "that is what we could afford in our budget". after a few weeks we had it with her and the listings she was showing us because it was neither in SF nor DC but further out. we pretty much gave up looking to buy and decided to go back to looking for a place to rent. luckily we found our current realtor at one of the places for rent that they were managing. couldn't have asked for more for a realtor, responds quickly, and sticks with our criteria.

initially me and my mom were pre-approved for 400k only, mom's credit score was high 790s low 800 in one of the bureaus. mine was 740-750. that amount won't get us anything in San Francisco, my sister's score was around 650
my brother stepped in and wanted to co-sign as well which raised it to 650k rate is 4.5% though but really all we could afford on our monthly mortgage is below 4k.

question for you guys here, since our downpayment is only 10% will we have to pay PMI? and if so, is that for the life of the loan? the realtor's assistant said it should only be for a year to pay PMI but she's not the realtor nor the lender so idk if I can take her word on that.
there's so much idk and it feels like I'm being left out of the process since my mom and sister are real close, I'm really only there for open houses but meetings with the realtor or the lender it's just those two. it's frustrating since english is my mom's 2nd language and doesn't understand much of the technical jargon (neither do i really), and my sister isn't even gonna be on the loan but they're talking to her like she's the one in charge between all of us.

lastly, is there any sites where I can read more about first time home buyers? maybe something easy to understand.

 

[suburbanguy]

initially me and my mom were pre-approved for 400k only, mom's credit score was high 790s low 800 in one of the bureaus. mine was 740-750. that amount won't get us anything in San Francisco, my sister's score was around 650
my brother stepped in and wanted to co-sign as well which raised it to 650k rate is 4.5% though but really all we could afford on our monthly mortgage is below 4k.

I'm not familiar with home prices in SanFran, but are you saying that a single family home at $400K isn't possible there? I'm confused.

Good scores though.

 

[dont be a menace]

initially me and my mom were pre-approved for 400k only, mom's credit score was high 790s low 800 in one of the bureaus. mine was 740-750. that amount won't get us anything in San Francisco, my sister's score was around 650
my brother stepped in and wanted to co-sign as well which raised it to 650k rate is 4.5% though but really all we could afford on our monthly mortgage is below 4k.

I'm not familiar with home prices in SanFran, but are you saying that a single family home at $400K isn't possible there? I'm confused.

Good scores though.

definitely not. it'll either be a condo or a fixer upper or one in a bad neighborhood + small sq ft. take a quick visit to any real estate site and type in sf with 2 bds.

 

[crcballer55]

 

 

was just reading this and couldn't agree more.

been crazy these past few months for me and my fam, the house we're renting in was foreclosed so we're in the process of looking for a new place. either renting or buying.

the only realtor we knew was my dad's when he bought a house a few years back so we went with her. We told her our info and how much downpayment we had and our criteria for a house, which was it has to be in SF or possibly DC but close to SF. but nah, she kept pushing for condos since "that is what we could afford in our budget". after a few weeks we had it with her and the listings she was showing us because it was neither in SF nor DC but further out. we pretty much gave up looking to buy and decided to go back to looking for a place to rent. luckily we found our current realtor at one of the places for rent that they were managing. couldn't have asked for more for a realtor, responds quickly, and sticks with our criteria.

initially me and my mom were pre-approved for 400k only, mom's credit score was high 790s low 800 in one of the bureaus. mine was 740-750. that amount won't get us anything in San Francisco, my sister's score was around 650

my brother stepped in and wanted to co-sign as well which raised it to 650k rate is 4.5% though but really all we could afford on our monthly mortgage is below 4k.

question for you guys here, since our downpayment is only 10% will we have to pay PMI? and if so, is that for the life of the loan? the realtor's assistant said it should only be for a year to pay PMI but she's not the realtor nor the lender so idk if I can take her word on that.
there's so much idk and it feels like I'm being left out of the process since my mom and sister are real close, I'm really only there for open houses but meetings with the realtor or the lender it's just those two. it's frustrating since english is my mom's 2nd language and doesn't understand much of the technical jargon (neither do i really), and my sister isn't even gonna be on the loan but they're talking to her like she's the one in charge between all of us.

lastly, is there any sites where I can read more about first time home buyers? maybe something easy to understand.

 First of all... DO NOT let ANYONE cosign on a loan with you. If you and your mom can't make the payment for whatever reason, he's stuck with the payment. Then if he can't pay, you're all in the same hole together with nobody to help dig you out.

I'm inclined to say not to go in with your mom either, but I'll leave it there if both of you are going to live there together. Make sure she has a will with the house being deeded to you if she dies so a sale isn't forced by your other siblings to extract their portion of the proceeds.

Regarding PMI... Ask the lender. I know enough to get me in trouble, but from my experience: FHA loans have PMI for the life of the loan regardless of how much you pay it down.

For conventional loans there is a 2 year minimum for PMI. The minimum amount owed that you can request to have it removed is 80% LTV. So if you're buying a $400K condo with 10% down, you're probably going to pay PMI for at least 5 years unless you're putting extra down on it.

For 1st time home buyer stuff, try this: https://www.churchillmortgage.com/free-reports/buying-your-first-home.aspx

They've got some good stuff in the Free Reports tab too.

I may be biased since I used to manage evictions, but if your mom doesn't speak English well and you don't know much yet, I would recommend holding off on buying for a while. Don't feel like you're being forced into the process by the market. Markets ALWAYS go in cycles even if SF feels like it's only getting more unaffordable by the minute. I would say about 1/2 of the evictions I did were for "minority" groups or people who didn't know what they were getting into, so I have a real soft spot for preventing people from getting taken advantage of.

 

[capital sb]

@dont be a menace  If you are considering DC I'm assuming you mean the whole DC metro area, if so you should consider Maryland's Mortgage Program.

It includes down payment assistance up to $8500, lower PMI's/lower PMI premiums(to pay up front), $2000 tax credit for the life of the loan,0% loan originator fee and low interest rates on the loan. I am going with this program for my loan I think it is very beneficial. You can check it out at their website 

DC also has a first home buyer down payment assistance program. I believe its called open doors.

You should also check out any first home buyer programs that Cali offers.

Edit: After rereading your post I'm not sure if you are actually talking about Washington DC 

 

 

[superantigen]

Yo foreal, crcballer55 is legit like my favorite NTer...like top 3 in this mugg...lol

Brah, you're a really awesome member and all the info. you drop is appreciated to the max.






...

 

[eugenile gts]

dont be a menace
thanks for sharing your situation.. a lot of folks are in similar out here in the bay.

to also add to the person shocked that $400K can't/wont buy you a single family home in the Bay Area.. it also won't buy you a townhome or a condo. I look at homes in the bay area on a regular to see how the market is and its very discouraging.

Rent in San Jose for a 2 bedroom condo/townhouse/apartment is $2K and this is in the not so desirable area. There was a post on how much SF rent is and I'm seeing $3-4K for like 1-2 bedrooms. Families renting a house here can expect to pay $3K+ in SJ.

this is what $728K gets you in san jose silicon valley:

4 bedroom 1200 sq ft lol. And it's not even in the "best" neighborhod. I look at other states and I just get so envious. we could be balling in mansions paying $2K a month mortgage pretty much everywhere else haha.

 

[crcballer55]

^ Was listening to a podcast yesterday with Jason Calacanis talking about the Hyperloop saying it would plummet Bay Area Real Estate because people could buy an acre in the Central Valley and commute a half hour into the Bay for their job. That would be awesome (for some) since prices have been insane for the past 10 years. You could legitimately buy 3 homes in Modesto for the price of a San Jose home.

 

[omariwestafari]

^ Was listening to a podcast yesterday with Jason Calacanis talking about the Hyperloop saying it would plummet Bay Area Real Estate because people could buy an acre in the Central Valley and commute a half hour into the Bay for their job. That would be awesome (for some) since prices have been insane for the past 10 years. You could legitimately buy 3 homes in Modesto for the price of a San Jose home.

also it would stagnate the renting market/prices IMO

 

[yanky]

^ Was listening to a podcast yesterday with Jason Calacanis talking about the Hyperloop saying it would plummet Bay Area Real Estate because people could buy an acre in the Central Valley and commute a half hour into the Bay for their job. That would be awesome (for some) since prices have been insane for the past 10 years. You could legitimately buy 3 homes in Modesto for the price of a San Jose home.

Hyperloop is going to cost millions of dollars. Elon Musk will be beginning to build a test track soon but $100million for a 5 mile stretch :x

http://www.cnbc.com/id/102458347

 

[crcballer55]

Much of the cost thus far has been in R&D and hiring engineers.

WAYYYY off topic, but here's the link to the best Hyperloop pitch I've heard! Start at 56:22

 

[monstar]

If the hyper loop was ever constructed id be gone lol. But that is a long way off

The rail system i feel i really missing out on a big opportunity righht now to transport people already making that grueling commute From stockton and tracy back

 

[edshoecator]

If the hyper loop was ever constructed id be gone lol. But that is a long way off

The rail system i feel i really missing out on a big opportunity righht now to transport people already making that grueling commute From stockton and tracy back

Europe is connected by rails, yet California, a state, can't connect the north and south in a timely, EFFICIENT manner.

 

[crcballer55]

Let's efficiently reconnect this thread with the original topic and help get some people in a new home.

 

[aepps20]

Crc what are your thoughts on taking out a second mortgage to avoid PMI? I have 20 percent down but I want sufficient cash reserves for other things. I'm not opposed to PMI but I wanted to get your thoughts.

 

[crcballer55]

Crc what are your thoughts on taking out a second mortgage to avoid PMI? I have 20 percent down but I want sufficient cash reserves for other things. I'm not opposed to PMI but I wanted to get your thoughts.

No. If you want sufficient cash, just wait to buy. By taking out a second mortgage to reserve cash, you're paying ~4-5% interest so your cash can earn what? 1%? That's going backwards. If you're talking about "investing" the cash, look what happened 7 years ago when home values and the markets went down together. Always have a 3-6 month reserve if you're considering buying. If you can put down 20%, by all means do it. Not having PMI or paying interest on a second will only put the cash in your pocket that much faster.

 

[aepps20]

Thanks for the quick response.