Can I afford to buy my grandmothers house?

[BigToque]

Originally posted by: lokiju
How much is owed on the house?

Nothing. The house was paid in full when my grandmother bought it over 10 years ago.

Originally posted by: rdubbz420
do you realize how much miscellaneous shit you need to buy/fix when you own a house? I bought a house in may and have spend about 30k so far on it. not including the 15k i needed for down payment/closing costs.

I know she has all new appliances, a brand new water heater, new AC system, new roof, brand new shower and low flow toilet.

We knew the original owners and basically know everything about the house since it was built in 1962.

I would assume there would be repairs needed at some point, even something that could pop-up over night, but the house seems to be in very good condition.

 

[MiniDoom]

Originally posted by: BigToque

Originally posted by: lokiju
How much is owed on the house?

Nothing. The house was paid in full when my grandmother bought it over 10 years ago.

Originally posted by: rdubbz420
do you realize how much miscellaneous shit you need to buy/fix when you own a house? I bought a house in may and have spend about 30k so far on it. not including the 15k i needed for down payment/closing costs.

I know she has all new appliances, a brand new water heater, new AC system, new roof, brand new shower and low flow toilet.

We knew the original owners and basically know everything about the house since it was built in 1962.

I would assume there would be repairs needed at some point, even something that could pop-up over night, but the house seems to be in very good condition.

and the 15k for down payment and closing? you should probably try to find a condo for under 100k.

 

[A5]

It sounds like a good deal and all, but no bank is going to approve you for that mortgage with $20k of existing debt and a $32k income. Tell your family to sell it on the market and let them get their cut.

 

[TehMac]

Originally posted by: hiromizu
Just put it on the card man, you'll eventually make more money and pay it off in a few years. Everyone is entitled to a nice house.

Uhh....no they're not when they're in debt. What are you, a member of Congress?

 

[BigToque]

Originally posted by: rdubbz420

Originally posted by: BigToque

Originally posted by: lokiju
How much is owed on the house?

Nothing. The house was paid in full when my grandmother bought it over 10 years ago.

Originally posted by: rdubbz420
do you realize how much miscellaneous shit you need to buy/fix when you own a house? I bought a house in may and have spend about 30k so far on it. not including the 15k i needed for down payment/closing costs.

I know she has all new appliances, a brand new water heater, new AC system, new roof, brand new shower and low flow toilet.

We knew the original owners and basically know everything about the house since it was built in 1962.

I would assume there would be repairs needed at some point, even something that could pop-up over night, but the house seems to be in very good condition.

and the 15k for down payment and closing? you should probably try to find a condo for under 100k.

My family has said they would pay the down payment and closing fees.

I never really considered this to be a real possibility because I figure the bank would never give me a mortgage that large. I'm meeting with a bank manager tomorrow to see what he says.

I'm not looking for any house/condo/apartment. I'm living at home in my moms basement paying down a loan and going to school for the next 3 years. I figured if I could make the payments for a few years, I could turn around and sell the house for a small profit, or at the very least, enough to pay the loan and university off while giving me the chance to live on my own and break even.

 

[Epic Fail]

Originally posted by: BigToque
The house has been valued at $230-250,000. Most houses are selling for over asking price in this area right now. I'm sure my family could walk away on the open market for $280-300. $220 was selling to me at the low value minus what it would cost them in commission selling to someone else.

Either the real estate agents are not doing their job or you have a misconception about the local prices, I'll take the later.

I also doubt your basement suites are legal rental spaces right now, plus you are assuming 100% occupancy rate to cover the mortgage that you cannot get and shits happen to houses.

 

[JeffreyLebowski]

Originally posted by: TehMac

Originally posted by: hiromizu
Just put it on the card man, you'll eventually make more money and pay it off in a few years. Everyone is entitled to a nice house.

Uhh....no they're not when they're in debt. What are you, a member of Congress?

<tap><tap><tap>
You might want to check your sarcasm meter. It seems to be broken.

 

[CRXican]

If you can get if for $150,000 then

 

[JS80]

Did we timewarp back to 2005?

 

[tk149]

Bad idea. I assume you have no savings. You can't put down 20%. You have no way to build up a cash reserve for emergencies (e.g. basement flood, new furnace, new roof, whatever).

You're going to get screwed on the mortgage rate, assuming you can get one.

If you need to sell the house, the market will not be kind.

Sorry, I know that's not the answer you wanted.

 

[Juddog]

I ran into a similar situation last year, and unless they are giving you a substantial savings on the property it's simply not worth it. My grandmother died and her house "market value" was $145,000, and that's what my family told me I would have to pay if I wanted it. At most they were willing to drop the price $10k but that money would be taken from my mom's share of the money. They ended up only being able to sell the house for $125k to some strangers from out of town after 3 months, so obviously they were playing me big time.

Your best bet in a situation like this is to back out and just let some strangers have it, otherwise you'll regret it.

 

[PingSpike]

Originally posted by: BigToque
The house has been valued at $230-250,000. Most houses are selling for over asking price in this area right now. I'm sure my family could walk away on the open market for $280-300. $220 was selling to me at the low value minus what it would cost them in commission selling to someone else.

The house has a 2nd lot that I was planning on selling dropping the cost of the mortgage even further.

I figured I could stay in the house while in university and then resell the house.

I make enough to pay the actual mortgage and taxes, so worst case scenario I can just re-sell the house if I need to.

Why don't they sell it for 280K then and give you 20K to pay off your debt. Sounds like a better value for everyone!

 

[swbsam]

Why are family members such dicks to each other?

I say fuck em.. Pay off your debt and buy your own place.

My wife and I just bought a house and are very happy with the decision, but getting a loan was tough in this market, and we make many times more than what you do.

 

[kalrith]

Originally posted by: A5
It sounds like a good deal and all, but no bank is going to approve you for that mortgage with $20k of existing debt and a $32k income. Tell your family to sell it on the market and let them get their cut.

Agreed. OP, even if you can afford the mortgage and taxes, that will put you at about 100% debt-to-income ratio. Most banks won't touch someone with greater than 40% debt-to-income ratio, and most want closer to 30% IIRC.

 

[masterxfob]

you can't rely solely on renters to get you by month to month. renters sometimes pay late, can move and leave you without a renter, and i'm sure there are many other scenarios that i'm unaware of.

 

[swbsam]

By the way - it's a bad deal EVEN IF YOU GET APPROVED.

They want to sell it to you because they're hoping you'd pay the full market value, while selling it on the market will always require negotiation.
It's a buyers market, so they're really trying to screw you here...

 

[DesiPower]

If its 220 market, I would pay 200 max. Your family is trying to rip you off and save the 6% selling fees.

About the finance of the deal, lets say they sell it to you for 200k, you will need to come up with at least 20% (coz of your income) that 40k, which, if i read the OP properly you do not have. Even If you have 40k then your loan amount will be 160k. Now lets say the 20k debt is car loan, the monthly payment is roughly $400, and your home payment will me ~1250 so total monthly payment is 1650. your income ~3000. Debt to income ratio = more than 50%, loan approval chance = epic fail.

my suggestion - run away from your family (with your cousin if possible)

 

[nick1985]

How 'bout no, Scott?

 

[Fritzo]

I haven't read the replies, but at $220,000, after taxes and insurance, your payment is going to be around $1800/month. With utilities and other house bills, you CAN NOT afford that house. You need at least another $30K of income to live there.

 

[richardycc]

If it is already paid for, why are you 'buying' it again? Who did she leave the house to in her will?

 

[waffleironhead]

Can you buy it on a land loan? IE, seller financing. You must set this up as a legal transaction, contract is required so there is proof o the terms of sale.

 

[Juddog]

Originally posted by: richardycc
If it is already paid for, why are you 'buying' it again? Who did she leave the house to in her will?

Her sons / daughters, who want to charge O.P. money to buy it so they can make a profit off of their mom's death; in other words a greedy ass family.

 

[Juddog]

Originally posted by: swbsam
By the way - it's a bad deal EVEN IF YOU GET APPROVED.

They want to sell it to you because they're hoping you'd pay the full market value, while selling it on the market will always require negotiation.
It's a buyers market, so they're really trying to screw you here...

^^ This - it's a scumbag move to try and get a family member to pay full market value for a house so they can sell it right away and make a huge profit, especially in a depressed real estate market.

 

[waffleironhead]

Originally posted by: Juddog

Originally posted by: richardycc
If it is already paid for, why are you 'buying' it again? Who did she leave the house to in her will?

Her sons / daughters, who want to charge O.P. money to buy it so they can make a profit off of their mom's death; in other words a greedy ass family.

I dont see it as greed. The house was left to the family as part of the estate. The only way that everyone gets an equal portion is for it to be sold and the resultant money split up. The only way for this to be fair to all involved is for it to be sold for as much as they would get on the open market. Was the op even in the will? If grandma wanted the house to go directly to the grandson she would have willed it that way.

 

[Legendary]

The premise of this thread is entirely fucked.
Market value? Do you read the news?
Also you already have 20k in debt so you won't even remotely get approved for a useful loan.