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$50k Saved, Can I Buy a House?

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Ah you're from San Jose too. I was gonna say, buying a 400k condo you better be in the SF Bay Area or Manhattan or something. Girlfriend and I are currently saving up for a house around here. Probably won't be able to buy until we have about 80k to put down heh. :Q🙁
 
Damn I bought my 3 bedroom 2 bath house for $85k, in Taylor, Michigan...

Glad I don't live where you are going... 🙂 My $12k downpayment was good enough for me!
 
Originally posted by: Kremlar
If the answer is no, then you would be better off saving more money so you can make a bigger down payment and eventuall pay less in intrest when you do buy a house.
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But in the meantime he throws money away on rent? Doesn't make any sense, unless he's getting a great deal.

Plus, real estate almost ALWAYS goes up. 2 years from now his $400K condo may cost $415K.

And interest rates are decent right now.
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I wouldn't say you're throwing away money if you rent. You're paying for a roof over your head. Do you throw away money when you buy food? Anyway, if he's paying significantly less renting - which he probably is - it's better for him to save up and have a lower mortgage.

 
Dude $50K down here in Texas, you would be 1/3 of the way in buying a decent house.

Spending all your saving on a house would be slightly silly. How about $25K?
 
it depends upon how much money you make to determine if you are throwing your money away renting. if you dont make a fat roll, then renting is better since you wont have to shovel out money for repairs, taxes, natural disasters, etc.

but i think the op makes enough money. if it were me, and i saved up that much money in such a short period of time, i would continue to rent for a few more years. just save up and buy outright, no need to mess with a loan.
 
wyvrn is right - it's not always throwing money away moving to a house from an apartment. Personally we're paying about $400-500 month MORE living in our house than in an apartment, and we didn't go up in class significantly. We have PMI, which is sucky, but even without it we have higher utility bills (heating/cooling), maintenance on the house, property taxes, insurance, etc. We didn't do it for a money move because it was clear that living in an apartment was cheaper. The difference in rent and what we're paying now could have been saved up for a greater investment return than what we'll get living in the house, at least definitely until PMI is taken care of.

We moved into a house because we wanted to. I hate apartments and everything about them, but just because you're paying towards a house/condo doesn't mean that you're suddenly saving money.

Of course with condos appreciation is typically considered to be less than a house, and association fees will kill you. Also, because of realty fees and closing costs, I wouldn't even dream about buying a house/condo unless I knew I'd be there a minimum of 2-3 years to recoup the losses.

And in terms of real estate appreciation, just because it's shot up in the last few years doesn't mean it can't drop 2% next year.
 
I would only do it under the following circumstances:

1) I was going to be there for 5 years or longer
2) Property values in that area appreciate at a reasonable amount 5%-7% a year or better
3) I knew I could easily sell it for more than I bought it for when I go to sell

If I couldn't meet those three demands, I personally wouldn't want to buy.

But then again, I would never, ever, live in an area that was running 400k for a condo regardless of what I was making for pay.
 
Originally posted by: Murphyrulez
Damn I bought my 3 bedroom 2 bath house for $85k, in Taylor, Michigan...

Glad I don't live where you are going... 🙂 My $12k downpayment was good enough for me!
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=( ...

im gonna move from california when im done with school. houses are waaaay expensive.

do you know what kind of house 85K gets you in Bay Area ( San Francisco and it's surrounding cities ) ????

85 months worth of rent for a 2 bedroom 1 bath, small house.
 
$400k and you don't even get at least a little plot of land under it is nuts. Buy a house.

20% down is never required (unless you have poor credit and/or can't properly document your income), but any loan amount greater than $322,700 is a Jumbo so different lending guidelines apply (as compared to regular conventional or government loans).
If this is your first house, I suggest scaling back a bit on price.
 
Originally posted by: Lounatik
If you were to put 50k down on a 400k home your monthly payments would be around 2050.00 /month. I did the math with this amortization schedule calculator. I basically put in a 6% interest rate and came up with that number. Can you afford that much per month? If so, go for it!.


Peace


Lounatik
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Don't forget taxes though... In NY or NJ, you could expect at LEAST an extra $500 in property taxes each month. Figure out the taxes in your area (and don't forget homeowners insurance, although that's fairly cheap.)
 
Originally posted by: wyvrn
Rent is not throwing your money away, though the current entitlement generation thinks it is. You have to pay for shelter, one of the most basic needs of being human. Apparently, video games and big screen TV's are more important these days 😉 🙂

Seriously, if you look around you can find a good cheap apartment. Alternatively, look in the paper for people who have a separate apartment building on their property they want to rent out, usually these are cheaper than living in apartment complexes and you will have a bit more privacy. If you live below your means, you can continue to save money without the responsibility that comes with owning a home (if you are young as has been suggested). Most young people who get into houses too early have some regrets about it. There is nothing wrong with paying rent for a couple of years until you decide where you want to live: remember, once you buy a house it will become your permanent place of residence, and is much harder to move if your community needs or income changes suddenly.

However, if you feel comfortable with the idea of owning your own house, I suggest not maxing out your mortgage payment every month. Look for a place below your means but with plenty of room. You can live there for 5-10 years while the property appreciates, and when/if you start a family you can always sell and move into a nicer house.

Hope this helps your decision, and good luck!
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It isn't a matter of entitlement. It is a matter of how you look at money. You can come out ahead when you own your home vs renting an apartment. There are factors you have to consider both ways, such as the cost of maintaining your home. The issue is that over the time he will live in a home, he can build up equity. You build up no equity living in an apartment. However, the value of living in a home over an apartment depends on many different factors. However, when someone says they are "Throwing away money on rent" I don't believe it has anything to do with feeling entitled to shelter. It has to do with the amount of money you are spending on a monthly basis that could be being put to better use building equity in a home.

Ryan
 
Originally posted by: Skoorb
You probably can, although your age and income and credit make it such that nobody can say for sure. I bought a house back in June with $0 down, although it was a hell of a lot less than $400k.
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age has nothing to do with it.
 
Originally posted by: Ameesh
Originally posted by: Skoorb
You probably can, although your age and income and credit make it such that nobody can say for sure. I bought a house back in June with $0 down, although it was a hell of a lot less than $400k.
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age has nothing to do with it.
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Yes it does. For one, you lack credit history. For another, if you're young and just out of school you don't have enough work history and there's no way in hell they'd qualify you for a loan that big.

I had to have my mom cosign on my loan even with a 752 credit score and 4 years of credit history.
 
Originally posted by: CrazyDe1
Everyone says you're so young. How old are you?
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Provided that the borrower is 18 or older and has established credit and work history, age is meaningless. As a mortgage loan officer, I've done loans for 19 year-olds and I've done loans for 90 year-olds. We cannot discriminate based on age.
 
Originally posted by: Vic
Originally posted by: CrazyDe1
Everyone says you're so young. How old are you?
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Provided that the borrower is 18 or older and has established credit and work history, age is meaningless. As a mortgage loan officer, I've done loans for 19 year-olds and I've done loans for 90 year-olds. We cannot discriminate based on age.
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That question was just more because I was wondering. Usually if you're 18 though you're not going to have sufficient credit history as you can't get a CC until you're 18 to have an established credit history.
 
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