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Is 350k house an excessive amount of ? (PMI, loan, rate of interest, 2014) – Mortgages -Lenders, loans, financing, charges, foreclosures, short-sales, brokers, credit score rating, deed, lien, refinancing, debtors

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Old

09-11-2016, 11:41 AM

 
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Hello there,

Trying to transfer in Laureate Park(Orlando FL space), we’re on the finish phases of probably buying – final thing left is for me to tug the set off and do it. Right here is our monetary scenario:

110K per 12 months mixed
Automobile fee of 350 monthly
0 different debt

Estimated mortgage fee with 5 % down fee is 2,200 monthly (consists of taxes, pmi, insurance coverage and so forth.) lender locked rate of interest at 3.5 %

Our web revenue monthly is 7,200 (gross is 9,000)

On paper, I believe this could be protected? In any case house/residing bills, we’d have an extra 1.5-2k monthly for financial savings and so forth.

With that mentioned, I’m beginning to get chilly toes primarily based on fairly a number of issues I’m studying on-line – for instance, that somebody making mixed revenue of 100-120K can not afford a 350K house primarily based on xyz calculations.

I’m OK with backing out of this deal – nonetheless, I simply really feel like there’s something I’m lacking as articles I learn on-line lead me to imagine we ought to be making 150K+ a 12 months and have a bigger down fee.

Any recommendation is appreciated –

We now have about 4 months of financial savings/wet day.
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Old

09-11-2016, 02:47 PM

 

Location: South Carolina

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Status: 422

That is an important rate of interest. However solely you possibly can determine what you possibly can comfortably “afford.” You might qualify for the mortgage but when the funds are increased than your consolation degree, then look to purchase one thing cheaper.

Your PMI will ultimately go away. Charges is not going to keep this low ceaselessly. You possibly can proceed to pay somebody’s else mortgage by renting or you can begin constructing fairness in your individual house funding. And remember that your curiosity is a tax write off, which additionally ought to be thought of when wanting on the massive image.

Chilly toes is regular. Residence shopping for is a really emotional expertise. Is there anybody IRL you possibly can speak to about this? A pal who’s a first-time house purchaser who’s already gone by way of what you’re going by way of now?

 

Old

09-12-2016, 12:43 AM

 
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Is {that a} 30 12 months loan? That $350,000 home would really price you over $570,000 , since you’ll be paying about $175,000 in curiosity.

Take a look at Mortgage Calculator

Plus it isn’t sure that home costs will keep excessive. Some persons are predicting one other crash. With that chance looming, it won’t be a good suggestion to purchase a home in a value vary that makes you nervous.

 

Old

09-12-2016, 07:32 AM

 
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Quote:

Initially Posted by tlarnla
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Is {that a} 30 12 months loan? That $350,000 home would really price you over $570,000 , since you’ll be paying about $175,000 in curiosity.

Take a look at Mortgage Calculator

Plus it isn’t sure that home costs will keep excessive. Some persons are predicting one other crash. With that chance looming, it won’t be a good suggestion to purchase a home in a value vary that makes you nervous.

Paying curiosity is anticipated on a mortgage, they will additionally make a number of extra funds a 12 months to pay much less curiosity and shave a 12 months or extra off the mortgage. Plus charges are close to or at an all time low. There is not going to be the same crash to final time, that was a singular scenario with wall road and bankers messing all the pieces up by giving unqualified sellers loans in addition to inflating house costs artificially.

 

Old

09-12-2016, 08:00 AM

 
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The house costs had been artificially inflated by flippers and different buyers. That’s occurring once more. And one of many markets that’s being closely inflated by flippers is Florida, the place the OP needs to purchase a home.

So far as curiosity is anxious, $175k on a $350k home appears fairly steep, does not it? That comes out to 50%. Many individuals do not understand simply how costly these 30 12 months loans are.

 

Old

09-12-2016, 08:33 AM

 

Location: Phoenix, AZ > Raleigh, NC

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Quote:

Initially Posted by tlarnla
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So far as curiosity is anxious, $175k on a $350k home appears fairly steep, does not it? That comes out to 50%. Many individuals do not understand simply how costly these 30 12 months loans are.

Only a few folks ever keep in a home lengthy sufficient to repay a 30 12 months mortgage, so your level is moot.

Regardless, no. I do not take into account $175k on a $350k loan fairly steep. I used any individual else’s cash for 30 years at 3.5% whereas leaving my cash invested in a tax sheltered IRA incomes 5-8% on mutual funds (typically extra). That curiosity deduction permits me to itemize and pay much less in taxes fir a minimum of the primary ten years of that mortgage, possibly longer.

The PMI that the OP is gonna pay as a result of they’re solely placing 5% down? THAT’S costly. My recommendation to OP could be to not purchase till you possibly can a minimum of put 10% down, then have a look at 80/10/10 mortgages. Higher but, get 20% doen.

 

Old

09-12-2016, 08:40 AM

 

Location: Lastly the home is completed and we’re in Port St. Lucie!

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30 12 months loans have been round ceaselessly. Hell, I keep in mind when rates of interest on these mortgage loans had been above 10%.

Banks make cash, we get a home.

Whether or not we lease or purchase, we are going to just about at all times have a month-to-month invoice for one thing we have to stay in.

In our case, that is our final house. We have rented all this time till we discovered the realm we need to keep in for the remainder of our time on this earth.

We aren’t a home as one thing to do away with down the street and make cash on. This will likely be our house. Not only a commodity or an funding.

 

Old

09-12-2016, 11:19 AM

 
4,399 posts, learn 9,675,364 instances

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Quote:

Initially Posted by strickforce
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Hello there,

Trying to transfer in Laureate Park(Orlando FL space), we’re on the finish phases of probably buying – final thing left is for me to tug the set off and do it. Right here is our monetary scenario:

110K per 12 months mixed
Automobile fee of 350 monthly
0 different debt

Estimated mortgage fee with 5 % down fee is 2,200 monthly (consists of taxes, pmi, insurance coverage and so forth.) lender locked rate of interest at 3.5 %

Our web revenue monthly is 7,200 (gross is 9,000)

On paper, I believe this could be protected? In any case house/residing bills, we’d have an extra 1.5-2k monthly for financial savings and so forth.

With that mentioned, I’m beginning to get chilly toes primarily based on fairly a number of issues I’m studying on-line – for instance, that somebody making mixed revenue of 100-120K can not afford a 350K house primarily based on xyz calculations.

I’m OK with backing out of this deal – nonetheless, I simply really feel like there’s something I’m lacking as articles I learn on-line lead me to imagine we ought to be making 150K+ a 12 months and have a bigger down fee.

Any recommendation is appreciated –

We now have about 4 months of financial savings/wet day.
Fee this publish positively
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With out realizing all the main points I believe your positive with what you posted. Make you’re plan to be there lengthy sufficient and that your job is secure.

 

Old

09-12-2016, 01:48 PM

 
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Status: 18

Thanks for the recommendation everybody –

I do know that we are going to not be on this house for 30 years. It will technically be our second house bought.

First house was bought in 2009 on the backside of the marketplace for 120K (house was initially offered in 2006 model new for 330K) – we lived it in till 2014 and offered. We now have been renting the final 1 1/2 years deciding the place we finally need to be. Our revenue whereas residing within the 120K house mixed was most likely round 90K – over the past 5 years now we have introduced it as much as about 113K.

The mortgage on a 120K house was about 800 a month – so going from that to 2,200 is sticker shock, though technically by my math, appears okay on paper and by most calculations I’ve researched. The lease on the house we’re in now, for instance, is 2,100 a month – and whereas now we have loved renting for this brief time – I might slightly be constructing fairness in a house. We even have 3 youngsters – which is why we wished to be in an space with good faculties and just a little bit bigger house.