^^ I would ask for the whole amount. You are in the position of control at this point. You're right - the chances of the seller finding someone to pay in cash or get a in-house loan are pretty small. That is lost money you will never get back so, unless the house is my forever dream home, I would walk away.

4/8/2015 3:06:54 PM

I also imagine the seller is making a pretty penny on this place (unless he purchased right before the market dropped in the late 2000s). His fault, his profit...he should pay.

4/8/2015 3:08:12 PM

I agree with both of you.

I asked for the full amount and told my agent to reiterate the fact that it's not my fault, and that he's not going to be able to sell to anyone with a conventional loan.

Initially, I wanted a 30 day close and the seller wanted 45. He had his people ask me two weeks ago if we could close early and I said that I wouldn't benefit from doing so at that point so we stuck with the initial close.

He's already moved out and, I assume, bought another place - which is why he was eager to close it sooner. It is a downtown condo, however, so I'm sure he could rent it out in a heartbeat if he wanted to.

And yes, he is definitely making a good profit on it (approximately $20k from a 2009 purchase) but I know the architect personally and he said that there have been upgrades like hardwood flooring and granite counter-tops, so I'm not sure if this guy renovated it or the owner before him did. The appliances are also pretty new.

4/8/2015 3:43:42 PM

I've never understood why HOAs give that type of info out, I don't think they're legally required to...they say they're there to preserve property values, but this type of thing does nothing but hurt them. I've battled with the same issue as it relates to the percentage of rentals within an HOA.

Anybody have experience with a 80/10/10 mortgage? Any advice?

4/8/2015 4:46:12 PM

Are those still useful now that you can write off pmi?

4/8/2015 4:51:08 PM

I'd like to know how we got such a good deal and yet here we are last month paying 533 dollars in interest when we got it for 3.75%?!

4/9/2015 2:25:27 AM

You pay a higher percentage of interest than principal to start with. Any mortgage amortization calculator should show that.

4/9/2015 8:52:41 AM

Srsly. It's a six figure loan. Not sure what he was expecting.

4/9/2015 9:12:09 AM

This is why if you dont keep a mortgage for at least 5 years you are definitely gonna lose out and how the banks always win. The first 5 years you are paying mostly interest and not gettin any equity.

4/9/2015 9:45:33 AM

I still pay $Texas in interest, as my loan is only 2 years old, even though my rate is 2.95%.

4/9/2015 9:45:37 AM

I told the seller to cover all of it ($4k) yesterday. He came back today offering to pay half. I'm still insisting on all of it. We'll see how this plays out.

4/9/2015 3:48:28 PM

Quote :

"Are those still useful now that you can write off pmi?"

i guess the way i see it, if you pay 2k/year in pmi and you end up paying $500 less in taxes (assuming a 25% bracket) you're still coming out 1.5k down overall.

4/9/2015 5:05:31 PM

Yeah, but won't pay a higher rate and additional fees on the other 10% ?

4/9/2015 5:34:56 PM

^That's sort of what i'm trying to gauge. I could pay 20% down, but that would really drain my liquidity. The other option would be to pay 10% down, get an 80% mortgage, and get another 10% loan secured with cash/brokerage account. Or get a home equity line for the other 10% using a rental property (but I would expect that to be a hassle, if possible at all).

I've never explored this type of financing, so any advice would be helpful.

4/10/2015 8:45:10 AM

http://www.moneycrashers.com/piggyback-mortgage/

Quote :

"As with virtually all financial decisions, this one comes down to your situation and how much of a down payment you can afford. For example, if you have a down payment near 20%, you might be better off just accepting a loan with PMI. Though you’ll pay PMI for at least a few months, once your loan balance reaches 80% of the value of your home, you can ask your lender to remove it. This approach could be less expensive than paying a higher interest rate on a second mortgage for many years plus higher closing costs. Or if your down payment is less than 10%, the interest rate on your second mortgage may be very high and thereby negate any cost savings from avoiding PMI. You’ll also want to consider whether you qualify to deduct PMI on your taxes and if you could deduct all the interest from a second mortgage or only a portion of it. All this said, the better your credit, the more likely a piggyback mortgage is to work for you. Be prepared to do some research to find a lender who is still willing to write this type of loan."

[Edited on April 10, 2015 at 9:27 AM. Reason : .]

4/10/2015 9:27:22 AM

ncsuallday, is the amount owed by one of the homeowners less than $4k?

4/10/2015 11:08:42 AM

PMI is such a scam. So the lenders fucked up and didn't do due diligence and lost a fuckton of money. The result? Those who want to buy a house have to pay more money to make sure the lenders don't fuck up again!

Thank god for VA loans.

4/10/2015 11:56:43 AM

^What kind of terms did you get with your VA loan?

4/10/2015 12:21:46 PM

Good to know. I ended up just putting 20% down. I wasn't very liquid either but had a few stocks I could cash out or worst case, tap my roth if something horrible happened.

4/10/2015 12:35:47 PM

I have a 30-year fixed jumbo VA (thanks, Maryland housing prices) that has an effective interest rate of 3.875% (orig date was Sept '14). I had to make up the 25% of the difference between my county VA max and purchase price, so I ended up putting a little less than 5% down.

and for whomever was bitching about interest - my last payment had an interest payment of $1919

[Edited on April 10, 2015 at 3:23 PM. Reason : .]

4/10/2015 3:18:48 PM

Psh, my whole mortgage is half that.

4/10/2015 3:32:23 PM

unless you're putting $400K down, that kinda mortgage is going to put you into the worst areas around washington DC. it really sucks.

4/10/2015 3:40:01 PM

Just signed the paperwork to refinance our house, yay for lower monthly payments.

4/10/2015 8:13:30 PM

Quote :

"unless you're putting $400K down, that kinda mortgage is going to put you into the worst areas around washington DC. it really sucks."

I'm originally from MD. It's pretty amazing what $500k will get you down here (NC) vs. what it gets you up there.

[Edited on April 11, 2015 at 10:46 PM. Reason : df]

4/11/2015 10:46:01 PM

bttt

8/5/2015 8:38:28 PM

I have an offer in on a beach condo.


SECU 90% LTV second home loan!!

8/6/2015 12:50:26 AM

I'm waiting on my TSP loan request to be processed for the 2nd time....accidentally faxed them a purchase order that was only signed by me the 1st time (not the version w/ the seller signatures)

8/6/2015 7:10:00 AM

^^nice! what beach?

8/6/2015 4:34:49 PM

Carolina Beach 3.25% 5 Year ARM 80% LTV

The condo is in need of some work (paint, flooring, appliances) but we got a 2 bedroom for less than some of the 1 bedrooms in the building are selling for. Hopefully it will be closed by the end of the month if all goes well.

The thing that sucks is going to be carrying it all winter until vacation rentals start back next spring.

8/8/2015 2:22:30 PM

This is probably the best place to post this:

My wife and I are ready to purchase our first home. We were living w/ relatives in D.C. and we are able to put away some cash. We almost bought a house in D.C., but after the home inspection we passed...reassessed our goals/careers and moved back to N.C.

Within 4 months of moving back, we had a baby, she had surgery and I just had surgery. She was out on non-paid maternity leave which hurt our ability to save and mean't I had to use the credit cards to cover 3 months of rent while she was on leave.

After all the surgery and baby bills get in, I predict that we will have about $8-9k in credit card debt.

I'm torn between paying off the the bill in full or slowly paying off the debt and using the cash for our down payment.

What say you?

8/10/2015 8:25:57 AM

the interest rate on credit cards is typically high enough that you should focus on it immediately - plenty of cards have a 0% intro balance transfer that you should do if possible - if you can do both and pay off the credit cards prior to the 0% intro rate going away then do both - if not then focus on the credit card debt first

8/10/2015 8:52:11 AM

^

8/10/2015 5:10:38 PM

Quote :

"I have an offer in on a beach condo."

So you're saying you are going to host a TWW party.


And for Restricted - definitely focus on the credit card debt and get that gone. When you go to get a loan, they will not want to see that kind of debt. Plus, the interest you would pay on the $8k at 18%+ could end up being more than the extra loan amount (when you have less down payment). Once you have your home loan and are in a better financial situation, you can always pay down your principal and lower your overall interest expense.

8/11/2015 8:54:55 AM

Boom. Went ahead and paid it off.

8/11/2015 9:47:47 AM

Nicely done Restricted!

8/11/2015 10:16:03 AM

I am on a webinar with a lender who has in-house financing that is outside of normal guidelines. They are calling it "NonQM" you can get a loan using bank statements instead of taxes if self employed, and scores as low as 561.

12/15/2015 11:19:48 AM

Quote :

"This is probably the best place to post this: My wife and I are ready to purchase our first home. We were living w/ relatives in D.C. and we are able to put away some cash. We almost bought a house in D.C., but after the home inspection we passed...reassessed our goals/careers and moved back to N.C. Within 4 months of moving back, we had a baby, she had surgery and I just had surgery. She was out on non-paid maternity leave which hurt our ability to save and mean't I had to use the credit cards to cover 3 months of rent while she was on leave. After all the surgery and baby bills get in, I predict that we will have about $8-9k in credit card debt. I'm torn between paying off the the bill in full or slowly paying off the debt and using the cash for our down payment. What say you? "

I would hoard cash, and talk to your lender about how to proceed 60-90 days out from your purchase. The lender is going to look at your debt to income ratio. If you have a $180 a month CC pmt, that is $180 less you can have in house payment.

They will not necessarily look at the balance, but the balance will affect credit scores. The way credit scores work is anything over 30% usage toward the credit limit looks unhealthy and your score will go down. So if you find its better to pay off the CC you can do that at least 30 days from making your loan application and take advantage of the boost to your credit score.

Another tip most people do not know is that when you make a CC payment you should always get it in before your bill cycles to get the best result on your credit score. So if your bill cycle date is the 12th that is the balance that is going to show on your report for the next month. Make a large payment on the 9th or 10th and all the bureaus see is the balance before the bill printed, which makes your score better for the next 30 days.

I have basically mastered manipulating credit. I had to get all debt off of my wife to close on the beach condo. I have an income but its much harder to document due to being self employed, so in a matter of two weeks I refinanced my car to pay hers off and did balance transfers to get her DTI% low enough to make the mortgage work. That is stuff not all loan officers are allowed to recommend to you, but if you understand their guidelines you can figure out ways to comply with them. The only debt on her credit report now is mortgage debt....me on the other hand, well I would be pretty screwed if she left me.

If you do not need both incomes to qualify for anything I generally do not recommend using both spouses. The reason is both spouses can own a property with only one being obligated to repay the bank. If both spouses are on the loan, then both have their debt to income ratio tied up, and both will take a hit to their credit if things go to shit. If the couple decides to purchase another home the spouse not on first loan is free to do it regardless of what happens with the old house, assuming they have enough personal income to qualify. My wife has 3 mortgages in her name, and I only have one...which now has enough years of rental history where I can offset it with rental income to qualify for another loan should a deal on another rental property come along.

12/15/2015 11:45:08 AM

we started running all our bills and expenses through a credit card to build airline miles and are looking at purchasing a home soon, i had never really considered the credit card but will that hurt us? we don't carry any balance month to month and i can make sure that our payments are posted before the balance date. credit limit is $25k, the most we might have in a month is about $4k but it gets paid off each month.

12/15/2015 1:28:01 PM

Pay off the card about 4 days before the due date so that on the due date your balance is $0. Generally the balance reported on your credit statement is whatever the balance was on your due date. Some also do it by the statement date but that's usually only 4-5 days after the due date which shouldnt be enough time to build a big balance.

12/15/2015 1:51:27 PM

^ this. Pay it off before the bill cycles so what is reported is at or close to zero, this will keep your scores high, and allow you to keep racking up points. The last thing you want to do is wait until the bill prints and then pay, because then it shows on the credit report that the card is run up and the score suffers.

If you sign up for a service like Credit Karma (free) you can see what we are talking about. It shows on each account what the reporting date is, that usually coincides with the bill cycle date. You want to pay off prior to that or you will have to wait until the next time it reports (30 more days) have any positive impact on your score.

12/15/2015 5:00:07 PM

If his credit limit is 25k I can't imagine a 4k balance being a big deal for the score

12/15/2015 5:35:54 PM

if it makes a difference, I also have a SECU credit card and SECU just raised its limit to $10k but I never use it

12/16/2015 8:20:33 AM

my score is is 700+ but my highest cc limit is $2500. my job is anything but lucrative do they base limits soley on your income?? if so are you guys really making 10x as much as me?

[Edited on December 16, 2015 at 10:37 AM. Reason : .]

12/16/2015 10:34:35 AM

use an online calculator such as http://www.bankrate.com/calculators/mortgages/new-house-calculator.aspx

income and debt are the largest factors in being approved for a specific amount - interest rate will fluctuate based on items like credit score

12/16/2015 11:14:46 AM

^^ might just be the card you have, i don't think all cards will automatically up the limit over time. The rewards card that's just the limit the gave me, i didn't request it and don't need anything that high. the SECU credit card started out with $2,500 years ago when I first got it but they have raised it 3 or 4 times as I've shown perfect payment history (and I also have an auto loan through them that I pay off and my checking and savings accounts are always in order and never overdrawn or anything, maybe that helps too). i guess i have a pretty comfortable salary, but i imagine that it's pretty average for most college graduates and considering you are in a high-tech field (at least I think that I read that) it may even be low to you.

thanks for the tips, i hadn't thought about the rewards card impact on upcoming mortgage applications but i just changed my calendar reminders so i'll make sure it's paid 4 days before the date

12/16/2015 1:13:21 PM

Quote :

"we started running all our bills and expenses through a credit card to build airline miles and are looking at purchasing a home soon, i had never really considered the credit card but will that hurt us? we don't carry any balance month to month and i can make sure that our payments are posted before the balance date. credit limit is $25k, the most we might have in a month is about $4k but it gets paid off each month."

Meh, 100K+ in credit and my scores are all in the high 700s

12/16/2015 8:55:33 PM

Credit card limit is $25K (haven't asked to raise it, but I easily put $5-12K on it a month with daycare, flipping a house and other various charges).

Also have an untapped line of credit for $150K on my house.

That said, my credit score is 812. Was lowered recently from 802 to 782, but now back up 30 points in 2 months...no rhyme or reason.

12/16/2015 10:17:16 PM

If I rent my house to my neighbor, who is known to smoke pot on occasion. Can I get in trouble if he gets caught for possession on my property?

12/23/2015 11:04:15 PM

I'm no lawyer, but I can't imagine you'd be on the hook for that.

Think about that on a larger scale, with all the people that rent property from other people, and all the crazy shit that happens on those properties.

12/24/2015 9:14:57 AM

Most leases will include a cause about illegal activities occurring on the premises. I suppose thats there to protect the landlord in the case of this.

12/24/2015 6:23:53 PM