Information on buying a House?

Question

Honestly Could you guys just reply back with dos and donts. Like maybe certain mistakes that you made which you can tell me so I will not do the same. Buying A house seems to be one of those subjects that I cant get alot of information on.

I am Military,Married I have excellent Credit and my cars are paid off so Idont have extra bills.
I am looking for somthing in the alabama tn or ga area. Mainly Georgia.
I was told not to get a mortgage that is more than 30% of your monthly income.. I was also told to wait about 2-3 more months to watcxh the prices drop on houses.
Im looking for the 110,000.00 range I have no kids. and I was also told to perhaps buy out a duplex and rent the other one out.

Yes I was approved for the 110,000.00 from USAA with 4.99%

Answer 1

You are in such a good position to buy a home. All of the advises regarding loan, Mortgage, VA and FHA you received already are great. And i am sure you can find the right loan for you and your budget and with monthly payments you are comfortable with.

A Duplex is always a good idea, if you like having a neighbor whose landlord you are as well.

I think the worldwide rule for buying Real Estate is and has always been location, location, location.

You can always remodell a home but only very rarely change the location of the property. If you picked a loan programm with payments you are comfortable with and have a purchase price set go and pick an area, find a local Real Estate Agent and go "Home Shopping". Have fun.

By the way, ERA Real Estate has a special program for Military people, you might want to check into that as well. .

Answer 2

Do:

- Get pre-approved for a loan. Find out how much your payments are going to cost for a given loan before you decide on how much you can or can't afford.

- Remember that your mortgage interest is tax deductible if you itemize your deductions. Depending on your income level, you'll be in a certain tax bracket. That tax bracket is the percentage of the mortgage interest that you'll get back by deducting the interest. So, if you're in a 30% tax bracket and pay $10,000 in mortgage interest for the year, you'll get back $3,000 more on your taxes. And, you'll be able to withhold $250 a month less in taxes ($250 a month more take-home). And, property tax is deductible, too.

- Use a real estate professional to make the purchase. Even if you have bought many properties in your life, it's so much less stressful and difficult if you have someone doing your negotiations, the paperwork, etc. And, get an aggressive one. If you contact an agent, and they seem wimpy or soft, go somewhere else. You want someone who will work aggressively for your interests, not cave in to the sellers just to make the sale or to "not upset" them.

- Hire a professional tax preparer to do your taxes. They know every little loophole and various ways to squeeze every drop out of your tax returns. I have found that the money they save me on taxes far outweighs how much they charge to do it for me.

- Get the home inspected as a contingency of purchasing the property. They might find something wrong with the home that isn't readily apparent.


Don't:

- Get a first mortgage for less than 80% of the value of the property. If you do, you will be subject to mortgage insurance, which will add about 20% to your mortgage payment, but isn't tax deductible. Get a first at 80%, and pick up the rest of the 20% with a second mortgage and/or a down payment.

- Get upset when the first home you find is perfect and something happens where you don't get it. There are plenty of "perfect" homes out there for people. Don't give up - you'll find one that works for you.

- Jump at a home because it's been "remodeled," when actually it's just been "flipped". Have you ever seen those house flipping shows on HGTV or whatever? They use the cheapest materials and labor. Most of the time they're just masking problems. And, I have never seen one permit being pulled for one of those TV projects.

- Reject a house because it's not perfect. That's what remodeling is all about. Even just cosmetic stuff. Also, you can negotiate down a price or get an allowance some times from the seller, especially in this buyer's market.

There are plenty of other things to consider. But, I don't have the time or the space on the page.

Answer 3

Here is just a couple of ideas on how to protect yourself in what is being called a "soft" market. First, make sure that when you execute that you put a contingency for appraised vale. If the property does not appraise out at least the purchase purchase price or more you get your deposit back. Second, go in low on your initial offer and have the seller pay the closing costs (up to the max that your loan type will allow). last and most important, get a home inspection. Make sure your contract says if there is problems that the seller will fix them or you can get your deposit back.
Use a stable direct lender, like Wells Fargo or Bank of America so you save money from using a broker, fees are less, and processing time is minimal.
I put some website below for VA, FHA and Conventional financing types, so you can get some information. VA is an excellent loan only for veterans. Debt to income ratios for VA is 41% on the net income.

Answer 4

Don't get talked into any ARMs or interest only loans, unless you are just positive you are going to be selling the house soon.
Do pay for an inspection.
Do BE PICKY. This is a big purchase, you should not settle. It took me 3 months to find my house and I almost gave up, but the right one was out there.
Do not buy a Duplex, in my humble opinion. Why have a wall attaching you to your neighbor? I think the whole purpose of a house is to be rid of the old Apt. days. If you are willing to do a duplex, might as well just get a Condo and I think those are just a waste of money.
Do talk to your insurance agent now. He/She will be able to steer you clear of areas/houses that will cost more to insure such as those in flood plains or over a certain age.
Don't stress out, even though it's very stressful. :)
Good Luck!

Answer 5

Wow, did Etta give you a good answer. Just three things to add: The HUD web site will have a link to a booklet called "Special Information Booklet for Home Loan Applicant." It's really good information. Also, on the Fannie Mae and Freddie Mac web sites, there are links to first time home buyer education classes. (http://www.fanniemae.com, http://freddiemac.com) These are short, many are online, and will give you lots of information. Finally, you mentioned you are Military - if you are eligible for USAA, there rates are usually pretty good and they're not going to give you bad information. You can trust them.

Correction to another answer above: Private Mortgage Insurance IS tax deductible for most borrowers. As of January 1 of this year. The person who told you otherwise is behind. For more information on tax deductibility for PMI, go to http://www.smartermi.com and click on the "For Homebuyers" link. You cannot get a second mortgage for a purchase anymore. The secondary market for those loans dried up, several of the companies that gave them have gone out of business. Again, that is old information that doesn't work anymore.

Answer 6

Sounds like you have received good advice so far.

Do not go for 100 per cent financing!

Do not get a variable rate if at all possible. With your good credit you should be able to get a good fixed rate.

Do take out a 15 year loan if possible

Do pay close attention to your contract and what is written in

Do get a buyers agent to help you find a house

Do pay for a house inspection

Do get a home warranty (ask the seller to pay for it) so you have no suprise expenses the first year for repairs

Do make sure you have enough cash for closing, escrow accounts, insurance and taxes

Answer 7

Dont buy a duplex.

DO get a VA loan.

You dont want your payment to be more then 30% of your takehome pay.... you dont want to be that strapped.

Yes, home prices could go down in the next 3-12 months.... no one can predict the bottom, but if you can find a really great deal, that does not matter.