House buying budget???

Question

I just made an offer on a house today and it got accepted....what do you think about my proposed financial situation??

I make $40,000 per year.
The price is $131,000
I am doing an 80/10/10 loan and principle and interest will be 760 per month.
I am paying taxes and insurance myself (no escrow) taxes will be 1000 per year and insurance about the same.

How does this look....would you feel comfortable?

Any tips or advice?

Answer 1

If you can pay rent that high, you can afford the mortgage. The things that get people (they forget about) are the expenses such as insurance, and having money to replace appliances, and do other household repairs. If you can afford to keep say, $3000 in a savings account and not touch it, and contribute to it also, you will be fine. At least then you will be prepared for a surprise when it arrises. For one less yearly expense, try adding your taxes to your mortgage. I don't know about the US but you can do that here in Canada.

Answer 2

It sounds reasonable, but are there any first time homebuyer programs available at lower rates? Also, see what your payment would be at 90% with the PMI and taxes and insurance included. Even check what your payments would be on 95% or 80/15/5 so that you can keep some cash reserves in the bank. But remember you will be responsible for the money for taxes and insurance yourself. Sometimes having it included in the payment is easier then coming up with it all at once.

Good luck.

cA lender

Answer 3

Well if your looking to make some money, have a stronger home, buy some land where you want to build and get a modular home built. It will take 5-8 months for you to pick out all your details but when your done it will take 8 days to assemble and your home needs to be apprasied asap. Usually its almost twice what you paid for it. If not then listen closely. Pick a bank, usually the one you use. Buy ONE stock. Now your a stockholder. Go to godaddy.com and get a url and email address. Your name Jack Doe get www.misterreo.com and your email would be [e-mail] Go to vistaprint.com and get free business cards and they should say your name and under it for a title should be REO Liquidator. You should buy a home with a company. Some banks wont let you close with a company but you can always sell it to the corporation for $1 afterwards (tax write off). Go to corporate.com and start a company. Name shoud be using my example Mister REO Inc. Now your a ceo of a reo liquidating company (REO Real Estate Owned) and your offical with a email address matching your company name. Oh I forgot. GO to onebox.com and for $17 a month you can have a toll free number, fax and voicemail. (email too if you need it, thats included) So on your business card your official. Email, fax, toll free number, company ceo. Call the bank ahead of time and ask who do you speak to, to purchase REO's from the bank. Let them know your a stockholder. Find the name and when they are off, work, and usually have lunch. take them out to lunch for $20 and more then likely they know you. Its your bank. Tell them your a reo liquidator and your looking for deals. You can buy homes for .60 cents on the dollar or less. Built in equity. In case they ask, but its not needed but to insure them your serious you should have your current credit report (680 or above is best for best rate) make sure nothing on there is 30, 60, or 90 days late in the last 12 months. Also have tradelines like 2-3 credit cards. Just make sure you dont owe MORE then 50% of the credit limit. (High Debt Ratio) Maybe have some assets ($5K, 10K, 20K) always better if they know if something happen you could pay a few months ahead of time or be good for a few months. There ya go, buying homes like your in a 99 cents store served to you on a platter. Will take some time for your confidence to grow but soon it will turn into a business. Buy a home for $60K, and sell it for $85K and its worth $100K. Quick money. Get your credit up, get 3-5 credit cards with $500 credit limit each. Go to a bank Monday morning and get a cash advance on all of them, say $200 each. Five cards will get you $1000. Tell them to put the cash in your account, walk out and mail off 5 checks with $200 on it lol. By next Monday the money will be there again. Do this every onday for 1 year and you would have charged $48,000 and your credit will be great!! Adds about 100-200pts easy.. Good luck, I hope I helped you. Also join that Direct Buy membership cost is $4000 but you save that on your first two purchases. Keep that in mind too for later when you buy your first house. Try westchestermodular.com for modular homes examples. Find a similar company in your area and take the tour, you will love it!!!

Answer 4

For me, it would depend on what other debt you have. There really isn't enough information to answer the question. For instance, if you have CC debt, a car loan, medical bills, student loans, etc., etc., this could get uncomfortable. Fast.