Need some answers on buying a house

[Glavinsolo]

Complete hypothetical questions from a novice home buyer

Fictional Scenario (but will most likely be what happens): I am a first time home buyer, I want to buy a house that is 180k, I have 20k for down payment, I have a fixed interest rate of 6%/30year through the bank, I have excellent credit.

I know that I'll have to pay PMI until I have 20% equity in the house
I know that interest paid to the bank is tax deductible

Do you pay tax on the home at the purchase time? 180k*6% sales tax
What is the average HOA fee for a home, per year/month?
What kind of tax breaks do you get for a home with a married couple?
What is the average property tax that you will have to pay?

What other fees/taxes/deductions etc do I have to look forward to besides just the mortgage

Cliffs:
Lots of questions about home buying

 

[KoolAidKid]

Originally posted by: Glavinsolo
Do you pay tax on the home at the purchase time? 180k*6% sales tax
What is the average HOA fee for a home, per year/month?
What kind of tax breaks do you get for a home with a married couple?
What is the average property tax that you will have to pay?

What other fees/taxes/deductions etc do I have to look forward to besides just the mortgage

Cliffs:
Lots of questions about home buying

Answers to these questions vary a lot depending on where you are buying the house. I would ask your real estate agent. Anyway, here are my experiences...

1) I paid state and county transfer taxes. They were about 1% apiece, IIRC. My state (MD) also gave a discount off of the transfer tax if you were a first time buyer.
2) My HOA fees are $92/year.
3) You can claim mortgage interest and some of your closing costs. Not a tax expert, but I don't recall any breaks specific to married couples.
4) This varies a lot. For my house taxes are around $3200/year.

 

[Vic]

The answers to all your questions vary according to where you live and your personal financial situation. There's no set answer. You need to talk to your realtor and your mortgage loan officer.

 

[iamwiz82]

Our purchase was very similar to yours:

(This info is all regarding our state, Michigan)

1. We had no state sales tax to pay.

2. No HOA

3. Our combined tax rate was ~9% last year after mortgage interest and student loans, along with some other deductions (property tax, that kinda thing).

4. $2400/year

 

[wedi42]

talk to you mortgage broker about doing 2 loans.
one for 80% and one for 10%
that way you can avoid paying PMI
the rate on the 2nd mortgage is a little higher, but still cheaper than PMI

 

[Vic]

Originally posted by: johngute
talk to you mortgage broker about doing 2 loans.
one for 80% and one for 10%
that way you can avoid paying PMI
the rate on the 2nd mortgage is a little higher, but still cheaper than PMI

Depending on credit rating, it usually adds up to about the same total payment, but the combo loan option has the benefit of being tax deductible whereas mortgage insurance is not.

 

[Glavinsolo]

Thanks everyone, very informative

 

[AbsolutDealage]

Originally posted by: johngute
talk to you mortgage broker about doing 2 loans.
one for 80% and one for 10%
that way you can avoid paying PMI
the rate on the 2nd mortgage is a little higher, but still cheaper than PMI

Yup, that's what I did, works like a charm.

As for the questions:

1. No sales tax for me (at least as far as I remember). If there is tax, it is rolled into the total mortgage amount, so you don't have to have that up front.

2. No HOA.

3. As far as I'm aware, there is no specific benefit to being married as far as home ownership is concerned. If you are filing jointly, your standard deduction is impacted of course, which will determine the cut-over point for itemization.

4. For us, this is ~$2500/yr... but this is VERY dependent on your location.

 

[AbsolutDealage]

Oh, and BTW, if you have not done so yet, check out Zillow... probably the coolest real estate site around.