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InvisibleAdden
I'm a teapot
Registered: 06/04/03
Posts: 39,201
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Tips on buying a home - how not to get screwed
    #21845495 - 06/23/15 10:36 AM (8 years, 7 months ago)

Wife and I are looking into buying a starter home. Just something for now, as a lot of money will be coming our way in the next five to ten years (300k or more).

So far we've found a few houses and manufactured homes from 30k-50k. A lot in those areas are foreclosures which worries me. I'm versatile as a journeyman contractor and can do a lot of work myself which is a big plus.

Anyhow, I'm comfortable in my finances just straight up cutting a check. Or should we mortgage? I mean, it'd be like 200 or less a month on some of these.

HoA fees are a joke and I learned that quickly, some are nice cheap homes but I'm not looking to pay 800 a month for something I own, then pay property tax.

We have three realtor friends, two of whom I've already spoken with.

Where am I most likely to get screwed? And should I even mortgage? It's a starter home, we are young first time homeowners, with a credit score of 750-760 (there was an error that, as I understand, will be gone in a few months). We are at or less than 10% of our utilization.

Buy it outright and wait for the 250-300k+ inheritance and then mortgage our new home?

I just want a place to call my own. Only thing hurting us now is not having work in that state yet, but working for us is a large purse.

Any comments or help appreciated. I'm really under the gun here.


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Invisiblenooneman
Male

Registered: 04/24/09
Posts: 14,561
Loc: Utah
Re: Tips on buying a home - how not to get screwed [Re: Adden]
    #21845591 - 06/23/15 11:01 AM (8 years, 7 months ago)

Quote:

Dys said:
So far we've found a few houses and manufactured homes from 30k-50k.



I keep my eye on real estate as a kind of hobby, so my first thought when reading this was "where the hell did you find actual houses between 30-50k?" Then I saw your other thread about moving to Ashland Oregon. So I looked up Ashland Oregon on Landwatch, and a few other sites.

There are no homes available in Ashland Oregon for under $100,000. There are mobile homes in mobile home parks available in that price range, but then you'd be pretty much paying rent to live in a place you technically "own."

Anyway, don't mean to be a total dick. I guess I was just like "30-50k? WHERE? Oh, it's not :\"

My advice is to stay away from mobile homes, HOAs, and to make sure you look up things like land rights (mineral, water, etc.) if you plan to stay there for long. It sounds like it's just a starter home so that may not be necessary. Don't rely on fences to tell you where the boundary of your property is. Fences move over time. Have someone professional come out to mark it off correctly. Make sure this agrees with the information the city has. Look up the local building codes, and make sure your place is up to code.

Keep in mind though how long it takes to buy and sell a home. You will need to do both if this is a temporary starter home. It's a very long and annoying process, and it can be expensive.


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InvisibleAdden
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Posts: 39,201
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Re: Tips on buying a home - how not to get screwed [Re: nooneman]
    #21845604 - 06/23/15 11:05 AM (8 years, 7 months ago)

Oops sorry, those are in Beaverton.

The 100k ones are within range for sure.


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InvisibleAdden
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Registered: 06/04/03
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Re: Tips on buying a home - how not to get screwed [Re: Adden]
    #21847180 - 06/23/15 06:54 PM (8 years, 7 months ago)

So what's the best way to expedite the process without saying "we can pay anything, want something now, and only needs minimal repair"? Just let the realtor do the talking, do everything mentioned above, get the inspection report and go from there?

And should we just mortgage it? Or part? If, say, we got a small 3b 2ba for 100k, am I better off throwing down 20k and taking advantage of the low mortgage rates for our future home? I'm only using 100k here for ease of numbers. I guess I mean to say, if I'm willing to throw down 20% instead of 10%, they'll know I have money and that leaves me without wiggle room right?

I mean, quite literally, if I found the right house I'd buy it tomorrow and just move out of MN next week.

I'm only 30 but have a lot more money than just 100k, but I imagine I'll want that mortgage on my credit report? But then again, if 5 to 10 years my inheritance comes I'll sack my credit score earned by bailing out on the mortgage early anyway right? Kind of like one-shotting a 5 year car payment at year 2?


Thanks for all the help anyone and everyone.


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InvisibleLunarEclipse
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Re: Tips on buying a home - how not to get screwed [Re: Adden]
    #21852414 - 06/24/15 08:33 PM (8 years, 7 months ago)

Put down 20% to avoid and PMI (private mortgage insurance) and to capture the still low interest rates, assuming you will be hanging on to the house for at least 5 years.  Otherwise, pay cash, the fees you avoid now is money in your pocket later.

Or, find a place that you can get for cheap cheap because you offer all cash.  The foreclosures would be better to go that way.  You might be able to get a place cheap, don't be afraid to offer low. 

It's still a good real estate market but may turn to shit.  Buy only one house and wait a while.  Personally I'd wait until November-December to even buy one.  The Shmita is real, wait for it!  Then you may not want to buy at all, but that's OK too.  The market in holiday season is much better time to buy than now!


--------------------
Anxiety is what you make it.


Edited by LunarEclipse (06/24/15 08:34 PM)


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InvisibleAdden
I'm a teapot
Registered: 06/04/03
Posts: 39,201
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Re: Tips on buying a home - how not to get screwed [Re: LunarEclipse]
    #21853992 - 06/25/15 07:24 AM (8 years, 7 months ago)

How much of a scam is private mortgage insurance?

It's got the "I" word in it... only thing I hate more than that is compound interest.


Edit autocorrect.


Edited by Adden (06/25/15 07:44 AM)


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InvisibleLunarEclipse
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Re: Tips on buying a home - how not to get screwed [Re: Adden]
    #21855030 - 06/25/15 12:49 PM (8 years, 7 months ago)

Quote:

Dys said:
How much of a scam is private mortgage insurance?

It's got the "I" word in it... only thing I hate more than that is compound interest.


Edit autocorrect.




I think it's become more of a scam now than it used to be.  As I understand it now, even if you reach 20% equity, you still continue to pay PMI at least typically?  There was a time that you could get the PMI dropped once you paid down your mortgage to the 20% equity threshold. 

Closing costs/loan fees in general are a horrible scam.  You could save $$ by paying cash and doing your own title check rather than paying for title insurance which a lender always requires, for example.

Another possibility for you to consider is a contract with a seller based on a high percentage down payment and a little higher rate?  Gives you flexibility.  Also can avoid an appraisal.

I'd typically suggest you pay for a home inspection by a hopefully qualified person.  If they find termites for example, you want to know.  Usually they find enough stuff to make it worth the $500 type charge if they are doing a thorough inspection.


--------------------
Anxiety is what you make it.


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InvisibleAdden
I'm a teapot
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Re: Tips on buying a home - how not to get screwed [Re: LunarEclipse]
    #21855072 - 06/25/15 12:56 PM (8 years, 7 months ago)

And it would behoove me to hire my *own* inspector, as I assume they lend favor to whoever hires them? A member here has also been advising me and said that the seller's inspector might overlook a few things in their favor, whereas the one I pay can knock thousands off a house with issues.

Thanks again.


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InvisibleLunarEclipse
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Re: Tips on buying a home - how not to get screwed [Re: Adden]
    #21855241 - 06/25/15 01:34 PM (8 years, 7 months ago)

Quote:

Dys said:
And it would behoove me to hire my *own* inspector, as I assume they lend favor to whoever hires them? A member here has also been advising me and said that the seller's inspector might overlook a few things in their favor, whereas the one I pay can knock thousands off a house with issues.

Thanks again.




You're welcome.

It's on the buyer to pay for the inspection, and the appraisal.  The closest thing to a "sellers inspection" is a disclosure form.  If they lie about condition and know or should have known, then theoretically you could have recourse.  Often people just say "unknown" because that's their CYA.

Usually the inspection comes first after the accepted offer, with a 10 day inspection period typical  You can of course ask for longer if there needs to be, it's negotiable.  Then, if you find issues then yea, it justifies price drops and their 60 page report and certified licensed inspector status lends credence to your subsequent efforts to drop the price by thousands.  Most people have neither the time nor expertise to spot problems.  Not all inspectors are equal however.  Insist on being with the inspector as they inspect, and ask lots of questions.  They should agree to those terms.


--------------------
Anxiety is what you make it.


Edited by LunarEclipse (06/25/15 01:35 PM)


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Invisiblebadchad
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Registered: 03/02/05
Posts: 13,372
Re: Tips on buying a home - how not to get screwed [Re: LunarEclipse]
    #21859130 - 06/26/15 09:35 AM (8 years, 7 months ago)

If you can avoid the interest of a mortgage, by all means, pay in full.  If you do, the only way you'll lose money is in repairs or if the market declines.  Take a look at zillow to see home sales in the area.  Be aware that the zillow "estimate" is shit.  The only values that matter are the actual sales numbers.

I wouldn't think a house in the 30-50k range would appreciate much, so get a good inspection.  If you're paying in cash, you can get whoever the hell you want.

PMI is a complete scam.  It does nothing to protect YOU, it protects the lender.


--------------------
...the whole experience is (and is as) a profound piece of knowledge.  It is an indellible experience; it is forever known.  I have known myself in a way I doubt I would have ever occurred except as it did.

Smith, P.  Bull. Menninger Clinic (1959) 23:20-27; p. 27.

...most subjects find the experience valuable, some find it frightening, and many say that is it uniquely lovely.

Osmond, H.  Annals, NY Acad Science (1957) 66:418-434; p.436


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Offlinech1ck3n.s0up
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Re: Tips on buying a home - how not to get screwed [Re: Adden]
    #21880404 - 06/30/15 09:50 PM (8 years, 6 months ago)

tl;dr: Find a neighborhood that you like, and rent for a year.

There are some red flags in your post:

Quote:

Dys said:
Any comments or help appreciated. I'm really under the gun here.



Why are you under duress? Not a good place to be when buying a home.

Quote:

Dys said:
Only thing hurting us now is not having work in that state yet, but working for us is a large purse.



So, you have no work where you'll be moving?

Quote:

Dys said:
as a lot of money will be coming our way in the next five to ten years (300k or more)



You'd be amazed at how quickly money like this can evaporate.

So, you're planning on moving to a new state, buying a home in a neighborhood with which you're not familiar, and bet on an inheritance that's a decade away.

:dubious:

Sounds like a foreclosure in the making.

Why are you under pressure to buy? Rent for a year and get a feel for the neighborhood. You may hate the people, find out that it's a flood zone... anything.


--------------------

"Inspiration ~ Move me brightly ~ light the song with sense and color ~ hold away despair ~ more than this I will not ask ~ faced with mysteries dark and vast ~ statements just seem vain at last" --Jerry Garcia, Terrapin Station

"Officer, I'm going to remain silent, and I would like to speak with a lawyer. I'm not resisting, but I don't consent to any searches.


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InvisibleAdden
I'm a teapot
Registered: 06/04/03
Posts: 39,201
Loc: Flag
Re: Tips on buying a home - how not to get screwed [Re: ch1ck3n.s0up]
    #21882725 - 07/01/15 12:28 PM (8 years, 6 months ago)

Going to be renting a year. Found a nice 125k for a cash purchase when the time comes, so at least they're there. Screw the mortgage. I'm sure they'll be around the same price range (I hope). Work starts at 20-23.50/hour from the contractors and companies I've spoken with who are interested, which isn't bad, and will go up substantially next May (new licensure).

My biggest concern is spending a little under half of what I've got in cash on a starter home.

Figure it out when we cross that bridge.


Thanks for the help everyone.


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InvisibleAdden
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Posts: 39,201
Loc: Flag
Re: Tips on buying a home - how not to get screwed [Re: Adden]
    #22413339 - 10/21/15 11:25 AM (8 years, 3 months ago)

Thanking my lucky stars we are renting for a year. I've done some research and learned the lay of the land as they say. I had addresses of some of these houses in my tablet.. I'm so glad I didn't just cut a check. Websites and realtors can make some real pile of shit places very deceptive.


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OfflineTravelerOfSorts
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Registered: 06/29/11
Posts: 492
Last seen: 2 years, 4 months
Re: Tips on buying a home - how not to get screwed [Re: Adden]
    #22413387 - 10/21/15 11:36 AM (8 years, 3 months ago)

I'm looking at having to rent for 4 months, first time on my own. I have no income during that time.
I considered this: buying a piece of small land like a piece of land for logging as it were I've seen these for sale as little as 2500$, but I would build a small underground house like the 50$ method, and put a big stove inside for the winter. I think I will be forced by my parents to remain in good relations and avoid arguing will need to fork out thousands which is not like me its more likely to live in a furnished hole in the ground than to pay someone way absurd amounts to horde myself away in a room.


--------------------
a soul of solitude
but a master of ecstacy
in waiting for my rebirth cycle i have hopes that when mushrooms find me it will occur then and i can go about the world as a medicine man
walking staff in one hand spaceship in the other
a journeyman of nature soon to be stepping up to novice hopefully i will have time to become an expert, and i believe only in death will i become a master


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OfflineTravelerOfSorts
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Re: Tips on buying a home - how not to get screwed [Re: TravelerOfSorts]
    #22463624 - 11/01/15 06:32 PM (8 years, 2 months ago)

^ this
still considering this. Tips for first time renting? ploxz


--------------------
a soul of solitude
but a master of ecstacy
in waiting for my rebirth cycle i have hopes that when mushrooms find me it will occur then and i can go about the world as a medicine man
walking staff in one hand spaceship in the other
a journeyman of nature soon to be stepping up to novice hopefully i will have time to become an expert, and i believe only in death will i become a master


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