HELP! What do I need to know before buying a house?

Question

The price will be 180,000

I am a first time home owner, how much do I expect to pay a month
at 5.65 interest with all the taxes???

I am considered low income (24K a year) but I plan on renting
the rooms to my friends.

WHAT OTHER COST DO I EXPECT TO PAY?

WHAT WILL MY MONTHLY PAYMENTS BE?

Answer 1

www.dinkytown.net

it's a website with a lot of mortgage calculators so you can plug in your income and get payments and how much house you can afford. You can fiddle with the numbers and interest rates and other variables to give you a bunch of takes on the situation. The fact that you will be renting to roommmates isn't going to factor in--they will not count that as potential income when it comes to qualifying you for a loan amount.

Get a real estate agent to help you, make sure they agree to be your buyer's agent. That means they are working for you and they are paid when the deal closes by the seller, not you, so it costs you nothing to get one. A lot of people make the mistake of thinking the listing agent is working for them, but actually, that agent is working for the buyer. It doesn't mean they aren't obligated to be fair and honest with you, but it does mean that their loyalty lies with the seller, not you.

Being low income, check out to see if you qualify for any HUD programs administered through your city govt. I got $10,000 from my city program because I made under $29,000 at the time I bought my house (the income limits will vary). There are other first time buyer programs out there, too. Also look at www.naca.com, they do their own fixed rate financing and it's undermarket rates. They are a non-profit housing advocacy group.

Good luck!

Answer 2

If you've applied for a mortgage, then the bank will tell you how much you'll pay. Also, most banks have mortgage calculators on their websites.

It's not just the monthly mortgage payment that'll become due. If you have less than 20 % , i.e. you are putting less than $36,000 down on a $180,000 mortgage, you will also pay PMI (private mortgage insurance). Plus, there will be property taxes which will be added to your monthly payment and paid directly by the bank. Also, there will be one-time costs - such as for a title search, the lawyer, etc. There will be a batch of $$$ up-front that you need to pay.

Also, just a a note: if you're planning to rent out rooms, do get a proper lease agreement. Especially if you're renting to friends. Mixing friends and business = normally not such a good idea.

Check out the book "Home Buying For Dummies":

http://www.amazon.com/Home-Buying-Dummies-Eric-Tyson/dp/0471768472/ref=pd_bbs_sr_1/104-7967279-7588710?ie=UTF8&s=books&qid=1172978621&sr=8-1


Good luck!!!
.

Answer 3

You need to know the name of a bankruptcy lawyer. You are sooooo far out of whack.

First of all, you cannot count on renters to pay the mortgage. If they don't pay the rent, you still owe the mortgage payment. If you can't cover several month's payments without rent money, you can't do the deal.

That brings me to the second point. Your mortgage payment can't be more than 25% of your monthly take-home pay. Even on a 30 yr mort., you'd be paying over 50%.

Thirdly, you'd need to put down $36,000 (20%). That covers you in case Murphy comes calling (new roof, new furnace, etc). It gives you built-in equity in case you get in a bind and have to sell.

You also need to be debt-free. With credit card payments, car payments, student loans, etc, you're putting too much strain on your income just to keep your head above water. One lay-off or illness and you're in the street. Along with that, you need 3-6 months expenses in the bank. That would be about $8-10,000 in your case. That's for emergencies, like your engine blowing up, or a lay-off, or that leaky roof.

Your plan is a dead set, guaranteed recipe for failure. With your income, I'd give you about a 2% chance of keeping the house more than five years.

Answer 4

Your payments are dictated by the rate you pay as well as the size of the loan. Risk determines your rate. If the sale price is 180,000, and you finance 100% of the money (no money down) you will be considered a higher risk. As a rule; 5.65% generally does not exist for 100% financing.

If your loan size is $180,000 your principal and interest payment would be $1,039.02. Put, if you really are going over 80% loan size to the value of your home you will most likely have to pay Private Mortgage Insurance. This is something that only protects the lender, not you. You should try to find someone who does not require this. Including this payment you would pay $1,138.02. If you wish to escrow your payments (including taxes and insurance for the home in each payment rather than paying on your own in lump sums) you can find out what the taxes are on the home by calling the county treasurers office. Take the total taxed amount, and divide this by 12 (months in a year) adding this value to the payment to determine what taxes being escrowed will cost you. Insurance varies by company, but the same calculations apply. I would estimate that with taxes your payment will be $1,316.52. I do not know what insurance would be. If it is in the hurricane states expect to get raped.

If they are asking 180,000 for the home, and you are going to finance all of it, you will probably have to sign a sales contract for a higher amount to factor in closing fees.

There are 3 types of closing fees. Prepaid items; include prepaid interest, taxes, and insurance. The prepaid interest sets you up for a couple months of deferred payments so that you don't make any payments until the determined date. Taxes and insurance are setup for the escrow payments if you want to pay them as part of your mortgage payment.

3rd party fees; these are dicated by the government/state/county. Recording title, state/county tax stamps, whatever fees the government determines everyone has to pay.

Lender fees; these include processing and underwriting (which keep the lights on) and origination/discount points. If it's in the form of a point you can write off the amount in your taxes. Generally if you pay more here your rate is lower. Consider the rate vs points game a teeter totter. Higher rate = lower points, lower rates = higher points. Points are a percentage of the loan. Ie; 3 points = 3% of your loan. 3% of 180K = $5,400 in closing fees.

You also may need to pay for an appraisal/survey of the home you are buying. You may also be on the hook for notary fees if you decide not to go with a certain lender. If you have to sign a waiver saying you will be required to reimburse the broker/lender if you do not use them as the finance company, you are screwed. That could be as much as 2000 out of pocket.

If you are going to put money down, these figures WILL change. I am very sceptical about the rate you are claiming you will pay. Especially since you did not say anything about putting money down.

If you are going through a broker, you may want to be carefull. Brokers periodically pull bait and switch tactics by promising you an amazing rate, and then changing the terms of the loan once you sit down to close the loan so that you feel painted into a corner and can't go elsewhere. If this organization asked you to pay for an appraisal/survey of the home, this should throw up another red flag that this is a broker. Many organizations will pay for it themselves.

If you have received a good faith estimate from a lender, keep in mind that document is as good as the toilet paper in your bathroom. The lender can say and write up 5.65 all day. I can send you a good faith estimate with negative fifteen percent if I really wanted to. Make sure you are discussing things with the actual lender, and not just the broker.

I doubt with your income you will qualify for a conforming loan. I know I wouldn't. Not to demean you, it's just really difficult. You also need 6 months of cash reserves in the bank, and on my income that's difficult to do, so I expect it's the same with you. That's not to say you don't qualify for a loan. You would qualify for a non-conforming loan, or specialized loan. Same programs, just different rates and plans.

Answer 5

relies upon, are you presently renting a house or an homestead? Are you planning on living on your present day section for a lengthy era of time? are you able to arise with the money for homestead funds/upkeep/taxes/etc. and a baby? With a baby having a house with a backyard has certain reward. no matter if you may deal with both paying for a house and having a baby relies upon on your economic problem. toddlers are intense priced and extra so then maximum people imagine. i'd advise paying for a house earlier you've toddlers if achieveable. solid success!

Answer 6

About 1,800 to 2,500 a month with water, gas & lights. If you can get a buyers home warenty insurance the person you buy from should provide it. Keep it after it runs about $300.00 a year but covers so much! My son floded the bathroom we had about $5,000 worth of work cost us $45.00!

Answer 7

the payment on a 30 year term with tax and insurance will be around 1,239.02 That (PITI) principle, interest, tax, and insurance. You will also be paying all the utilities

Answer 8

Your question requires knowledge of both mortgages and real estate investing. I'd suggest you contact an investing real estate agent. Not all agents are investors, so be sure to ask. They will be able to advise you and aswer this question for you.

Answer 9

Hehehe, I remember flooding my parent's bottom floor accidentaly when my 50 gallon fish tank broke.

My parents always complain about property tax because they paid 4,000 dollars on their 400k home last year.