Turn Off Ads?
Page 2 of 5 FirstFirst 12345 LastLast
Results 16 to 30 of 70

Thread: Advice on Buying a House

  1. #16
    Member Sea Ray's Avatar
    Join Date
    Mar 2005
    Location
    Cincinnati, Ohio
    Posts
    20,584

    Re: Advice on Buying a House

    Quote Originally Posted by Boston Red View Post

    Also, the new tax law isn't "bad" for homeowners (at least not in relatively low tax states like Georgia). It's just not advantageous for homeowners. Everyone gets the benefit of the higher standard deduction, so you get to take the deduction whether you actually pay mortgage interest or not. You're not going to be worse off because of it. You just (likely) won't see a mortgage interest deduction on a Schedule A.

    Good point. Everyone gets the benefit so only in the sense that you don't have to have a mortgage in order to enjoy the benefits do homeowners get screwed. I think the idea is to lower the number of people who have to itemize 'cause that's a hassle and often an expense of hiring an accountant. For example when I was itemizing I was deducting $18K. Since now every married couple gets $24K, I'm no longer deducting my interest but I've benefited to the tune of $6K in deductions.

  2. Turn Off Ads?
  3. #17
    Member
    Join Date
    Aug 2001
    Location
    Cleveland, OH
    Posts
    2,679

    Re: Advice on Buying a House

    Quote Originally Posted by RedEye View Post
    Thanks, guys. We've actually got a contract on a house now, but are getting sticker shock and cold feet. The house is just five years old, so almost like new construction. The mortgage will be a 30-year fixed and we took a loan from my wife's 403b retirement account to put 10% down. Even so, paying back that loan + the PMI of not reaching 20% is going to add about $600 to our monthly payment. That's hard to stomach with all of our other expenses, so we are thinking of pulling out. I'm just wondering -- is this kind of stress what others went through?
    I think you should wait. Taking retirement account loans for anything that isn’t a total emergency (this isn’t) is a bad idea and as others have said PMI is a rip off. Unless you just know you are getting a large amount of cash to do a quick refi and the housing market is going to explode in the area you are looking, but otherwise that PMI is an anchor.

    Renting offers a lot of flexibility. I think you should really budget your expenses and plan on spending a year or two really saving and get a bigger down payment.

  4. Likes:

    goreds2 (12-11-2019)

  5. #18
    Bullpen or whatever RedEye's Avatar
    Join Date
    Feb 2006
    Location
    Atlanta, GA
    Posts
    9,220

    Re: Advice on Buying a House

    Quote Originally Posted by BuckeyeRed27 View Post
    Renting offers a lot of flexibility. I think you should really budget your expenses and plan on spending a year or two really saving and get a bigger down payment.
    Yeah, this is a large part of my thinking as well.

    The counter argument, which we've been bouncing around in our conversations, is that a house is also a home, and our kids will have a better quality of life if we are in one for the next ten years or so (they are boys, ages 10 and 5).

    We have two decent paying jobs, but we lost our nest egg on our first house in the recession and haven't been able to muster much savings since then due to various other circumstances out of our control (medical bills, etc.) We now qualify as first time buyers again since we have been renting since 2013, but the market for Atlanta area, at least inside the perimeter in decent school districts, is a glut of way overpriced rentals and single family houses and townhouses beyond our reach.

    So we realize that taking a hit on the 403b isn't the ideal way to do this, but it does give us the opportunity to own a home now, when it counts most for our family's experience of these years.

    And so we go round and round and round...
    "I’ll kind of have a foot on the back of my own butt. That’s just how I do things.” -- Bryan Price, 10/22/2013

  6. Likes:

    REDREAD (12-16-2019)

  7. #19
    Bullpen or whatever RedEye's Avatar
    Join Date
    Feb 2006
    Location
    Atlanta, GA
    Posts
    9,220

    Re: Advice on Buying a House

    Quote Originally Posted by Sea Ray View Post
    Good point. Everyone gets the benefit so only in the sense that you don't have to have a mortgage in order to enjoy the benefits do homeowners get screwed. I think the idea is to lower the number of people who have to itemize 'cause that's a hassle and often an expense of hiring an accountant. For example when I was itemizing I was deducting $18K. Since now every married couple gets $24K, I'm no longer deducting my interest but I've benefited to the tune of $6K in deductions.
    Am I understanding correctly that, we a family of four, will qualify for $24K for being married and $12K for each kid to equal $48K?

    Though I'm a bleeding heart liberal, I actually don't mind the loss of the additional house benefit from a philosophical point-of-view. The previous system was so skewed toward home ownership that it basically didn't make sense *not* to buy a house. I think that's part of what led so many people to reach for houses they couldn't afford. Heck, we were using our (misunderstanding of) the tax credits to talk ourselves into taking on a higher monthly payment. Now that we know that can't happen, we're rethinking that risk.

    That said, what I'm upset about is that this "evening" of the tax code back away from home buying advantages hasn't yet been complemented by more regulation of the rental market. So now people like us, middle to upper-middle class, are squeezed between over-priced rentals and a housing market that no longer offers the advantages it used to. Kinda sucks, to be honest.
    "I’ll kind of have a foot on the back of my own butt. That’s just how I do things.” -- Bryan Price, 10/22/2013

  8. #20
    Member
    Join Date
    Aug 2001
    Location
    Cleveland, OH
    Posts
    2,679

    Re: Advice on Buying a House

    Quote Originally Posted by RedEye View Post
    Yeah, this is a large part of my thinking as well.

    The counter argument, which we've been bouncing around in our conversations, is that a house is also a home, and our kids will have a better quality of life if we are in one for the next ten years or so (they are boys, ages 10 and 5).

    We have two decent paying jobs, but we lost our nest egg on our first house in the recession and haven't been able to muster much savings since then due to various other circumstances out of our control (medical bills, etc.) We now qualify as first time buyers again since we have been renting since 2013, but the market for Atlanta area, at least inside the perimeter in decent school districts, is a glut of way overpriced rentals and single family houses and townhouses beyond our reach.

    So we realize that taking a hit on the 403b isn't the ideal way to do this, but it does give us the opportunity to own a home now, when it counts most for our family's experience of these years.

    And so we go round and round and round...
    I can’t tell you what makes emotional sense for you and your family. If you believe that you will get some perceived value out of home ownership that renting doesn’t provide that’s fine. But home is wherever you make it no matter what type of arrangement you have to get the keys and I don’t think what you laid out makes good financial sense. You also already bought a home at the top of a market and I’m a little afraid you are about to do it again.

  9. Likes:

    goreds2 (12-11-2019)

  10. #21
    Member
    Join Date
    Apr 2005
    Location
    Utilizing Catholic Moral Code
    Posts
    4,103

    Re: Advice on Buying a House

    I can't speak to the rental regulation (other than I suspect that I would think what you want is bad ), but don't let the changes to the Code fool you. The "home buying advantages" haven't been taken away. You just don't have to buy a home anymore to take advantage. Don't let it mess with your brain/decision making on buying your home.

  11. Likes:

    Sea Ray (12-11-2019)

  12. #22
    Bullpen or whatever RedEye's Avatar
    Join Date
    Feb 2006
    Location
    Atlanta, GA
    Posts
    9,220

    Re: Advice on Buying a House

    Quote Originally Posted by BuckeyeRed27 View Post
    I can’t tell you what makes emotional sense for you and your family. If you believe that you will get some perceived value out of home ownership that renting doesn’t provide that’s fine. But home is wherever you make it no matter what type of arrangement you have to get the keys and I don’t think what you laid out makes good financial sense. You also already bought a home at the top of a market and I’m a little afraid you are about to do it again.
    Yes, I agree with you. We have to *at least* get the monthly payment under control, or we are going to be stressed constantly about making ends meet.

    I requested termination papers this morning. Back to the drawing board, in a lower price range.

    You guys are confirming my own hunch about what we need to do. This is very helpful, thanks.
    Last edited by RedEye; 12-11-2019 at 11:08 AM.
    "I’ll kind of have a foot on the back of my own butt. That’s just how I do things.” -- Bryan Price, 10/22/2013

  13. #23
    Member Sea Ray's Avatar
    Join Date
    Mar 2005
    Location
    Cincinnati, Ohio
    Posts
    20,584

    Re: Advice on Buying a House

    Quote Originally Posted by RedEye View Post
    Am I understanding correctly that, we a family of four, will qualify for $24K for being married and $12K for each kid to equal $48K?

    Though I'm a bleeding heart liberal, I actually don't mind the loss of the additional house benefit from a philosophical point-of-view. The previous system was so skewed toward home ownership that it basically didn't make sense *not* to buy a house. I think that's part of what led so many people to reach for houses they couldn't afford. Heck, we were using our (misunderstanding of) the tax credits to talk ourselves into taking on a higher monthly payment. Now that we know that can't happen, we're rethinking that risk.

    That said, what I'm upset about is that this "evening" of the tax code back away from home buying advantages hasn't yet been complemented by more regulation of the rental market. So now people like us, middle to upper-middle class, are squeezed between over-priced rentals and a housing market that no longer offers the advantages it used to. Kinda sucks, to be honest.
    To my knowledge there is no standard deduction for kids. So your standard remains at $24K. They doubled the tax credit on kids from $1K to $2K.

    These are all personal choices for you and your wife to make but I'm going to weigh in anyway...

    Given what you've told me, I'd consider splurging on a house for your kids benefit. We splurge on our kids all the time. It's part of being a middle class parent. If you wait till you can afford it the kids will be in college and before long you'll still be waiting. My parents told us that if they had waited till they could afford kids they'd never have had us. We "all" go into debt to do what's best for our kids. That's just a big picture view from Sea Ray. Your mileage may vary...

  14. #24
    * Bat Votto Second * goreds2's Avatar
    Join Date
    Jul 2006
    Location
    OH H - EYE OH
    Posts
    3,341

    Re: Advice on Buying a House

    Not sure if I saw this advice. In my opinion, a FREE home warranty is good if the sellers grant you one. Do not renew and have to pay for one after it expires. All they do is band aid an issue if something is broken. It would take a very lot for them to totally replace a HVAC unit or kitchen appliance etc.

    Try to get out of debt or reduce it the best you can.

    Keep your car after it is paid off. Reduce eating out and ordering to go. That will help big time in reducing debt and allow you to pay extra on your mortgage. Get that baby paid off in 15 years!

    You are the landlord now and will have to pay for any breakdowns etc. Best wishes,
    Last edited by goreds2; 12-11-2019 at 12:54 PM.
    * Attended the 1990 and 2010 Reds Division clinchers *

    Listened to the 1995 Div. Clincher on WLW - Watched the 2012 Div. Clincher on FOX.
    Watched the 2013 Playoff Clincher on FSO - Fiance' is a UK fan
    GO STEELERS - Go Buckeyes - Go SIXERS

  15. Likes:

    cumberlandreds (12-11-2019),RedEye (12-11-2019)

  16. #25
    Bullpen or whatever RedEye's Avatar
    Join Date
    Feb 2006
    Location
    Atlanta, GA
    Posts
    9,220

    Re: Advice on Buying a House

    Quote Originally Posted by Sea Ray View Post
    Given what you've told me, I'd consider splurging on a house for your kids benefit. We splurge on our kids all the time. It's part of being a middle class parent. If you wait till you can afford it the kids will be in college and before long you'll still be waiting. My parents told us that if they had waited till they could afford kids they'd never have had us. We "all" go into debt to do what's best for our kids. That's just a big picture view from Sea Ray. Your mileage may vary...
    Totally. This is actually the other little voice in my head — that old “you only live once” and “your kids are only young once” argument. It’s been doing battle with the other “financial responsibility” voice for months now.

    We terminated the contract today.

    I agree that splurging has value in these circumstances, but we need to make a more calculated splurge. We are still in the market, but renewed our lease for 6 months on the apartment in order to look for a house in a lower range. It will be a splurge no matter what, but it doesn’t have to imperil our well-being to quite this extent.


    Sent from my iPhone using Tapatalk
    "I’ll kind of have a foot on the back of my own butt. That’s just how I do things.” -- Bryan Price, 10/22/2013

  17. Likes:

    Sea Ray (12-11-2019)

  18. #26
    Pitter Patter TRF's Avatar
    Join Date
    Apr 2000
    Location
    Letterkenny
    Posts
    19,920

    Re: Advice on Buying a House

    Quote Originally Posted by RedEye View Post
    Thanks, guys. We've actually got a contract on a house now, but are getting sticker shock and cold feet. The house is just five years old, so almost like new construction. The mortgage will be a 30-year fixed and we took a loan from my wife's 403b retirement account to put 10% down. Even so, paying back that loan + the PMI of not reaching 20% is going to add about $600 to our monthly payment. That's hard to stomach with all of our other expenses, so we are thinking of pulling out. I'm just wondering -- is this kind of stress what others went through?
    We did almost this exact same thing. My wife and I are employed by a college that opted out of Social Security in the 80's so we have a 403B in place of it that we can borrow against. We borrowed against mine for debt consolidation and hers for the down payment.. Our new house payment is $900 more than our old payment, which we are still paying. My son lives in the house and he makes the payment.

    Quote Originally Posted by goreds2 View Post
    Not sure if I saw this advice. In my opinion, a FREE home warranty is good if the sellers grant you one. Do not renew and have to pay for one after it expires. All they do is band aid an issue if something is broken. It would take a very lot for them to totally replace a HVAC unit or kitchen appliance etc.
    Completely disagree with this. The house we bought sat empty for 2 years and in the first year alone, the warranty saved me about $500 in AC repairs. we renewed it in April. 2 weeks ago, our water heater basically dumped water all through my house. It's located in a utility closet in the middle of the house. Called the warranty, and they replaced it for $75. Warranty is about $600 per year billed monthly. Totally been worth the $50 per month. And while they have repaired the AC, it's about 30 years old. Only a matter of time before it breaks to the point of replacing it, but I don't have the scratch for a completely new system.
    Use a Cocktail Stick!

  19. Likes:

    RedEye (12-11-2019)

  20. #27
    Daffy Duck RedTeamGo!'s Avatar
    Join Date
    Apr 2013
    Location
    Cleveland, OH
    Posts
    12,847

    Re: Advice on Buying a House

    Don’t make the mistake I made and buy a 100 year old house. Constant repairs.
    What would you say.....ya do here?

  21. Likes:

    Boston Red (12-11-2019),goreds2 (12-11-2019)

  22. #28
    Member klw's Avatar
    Join Date
    Jan 2005
    Location
    New England
    Posts
    13,136

    Re: Advice on Buying a House

    Instead of a PMI, look into doing a FHA loan in which you pay a fixed amount at closing for mortgage insurance. When we bought our last house we did it. With us it would then pay for itself after three or 4 years, so it only makes sense if you are planning to be there a bit. On ours we also did a very low down payment loan, if not 0, but we both had credit scores at or above 800 so we had options. Look around and see what may be available to you.

    Also get an extensive home inspection and make sure you test for radon and also get more than a basic water test- ex test for arsenic, lead, radon in the water as well. Do not assume that because it is municipal water that you can avoid this. We had one house contract we got out of because the well water had arsenic and radon. To treat it to safe levels was going to require a $14,000 system. In that state, 25% of wells would fail an arsenic test (per the state health dept page).

    Having a trust worthy inspector can't be stressed enough. We had 6 house contracts fall through in 18 months a decade ago with 5 being for problems discovered in the inspection- from Asbestos, to faulty wiring, to water, to mold,to underbuilt supports, etc. It was always something different and not stuff we would have discovered on our own. With the last two we have bought, there were minor things found and the inspection report served as a guide for planning repairs and upgrades.
    Last edited by klw; 12-11-2019 at 03:56 PM.

  23. #29
    Be the ball Roy Tucker's Avatar
    Join Date
    May 2001
    Location
    Mason, OH
    Posts
    15,661

    Re: Advice on Buying a House

    - Rainy days will happen. You don't get to choose when they occur. Be prepared. Have contingency plans. Don't overextend yourself and get house poor. Somebody will always have a nicer house than you. Get over that. The banks are willing to lend you a lot more money than you realistically can afford. Don't go nuts.

    - Get a 15 year loan. You want to pay off your loan in a reasonable amount of time. 30 years is a really long time and you don't want to be making house payments into your 60's. You'll be paying for college then :-)

    - Like others said, make more than you're normal payment if you can afford it.

    - Depending on your family plans, buy space, not options. Options can be put in relatively cheap. Paint, wallpaper, new woodwork, trees, bushes, etc are just materials and sweat equity. Adding new rooms costs a lot.

    - Speaking of which, do your own work. Get familiar with being a handyman. And be patient. Don't expect the house to be "done" in a couple of years. Landscaping takes time too. Learn how to split plants. There is a lot of reward that comes from making your house nice by the sweat of your brow.

    - I second the buy a house in a good school district and a good neighborhood. I live in Mason OH and houses last on the market here less than a week and rarely even that. But we've built great schools. Selling a house here usually is a bidding war.

    - Keep up with maintenance. The longer you let it go, the worse it gets.
    Big John's been drinking since the river took Emmylou

  24. Likes:

    goreds2 (12-11-2019)

  25. #30
    Future Fame of Holler WildcatFan's Avatar
    Join Date
    Jul 2007
    Location
    Lexington, KY
    Posts
    1,730

    Re: Advice on Buying a House

    Quote Originally Posted by RedTeamGo! View Post
    Don’t make the mistake I made and buy a 100 year old house. Constant repairs.
    Mine's 90 years old. I've mostly learned to hate plaster.
    "I never argue with people who say baseball is boring, because baseball is boring. And then, suddenly, it isn't. And that's what makes it great." - Joe Posnanski

  26. Likes:

    alwaysawarrior (12-13-2019),goreds2 (12-11-2019),RedTeamGo! (12-11-2019)


Turn Off Ads?

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •  

Board Moderators may, at their discretion and judgment, delete and/or edit any messages that violate any of the following guidelines: 1. Explicit references to alleged illegal or unlawful acts. 2. Graphic sexual descriptions. 3. Racial or ethnic slurs. 4. Use of edgy language (including masked profanity). 5. Direct personal attacks, flames, fights, trolling, baiting, name-calling, general nuisance, excessive player criticism or anything along those lines. 6. Posting spam. 7. Each person may have only one user account. It is fine to be critical here - that's what this board is for. But let's not beat a subject or a player to death, please.

Thank you, and most importantly, enjoy yourselves!


RedsZone.com is a privately owned website and is not affiliated with the Cincinnati Reds or Major League Baseball


Contact us: Boss | GIK | cumberlandreds | Gallen5862 | Kinsm | Plus Plus | Powel Crosley | RedlegJake | The Operator