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Vdubchaos is actually giving pretty decent advice, just not in the most eloquent way.

Wanting things you can't afford is a big problem. However, everything has a cost, including a mortgage. I see no issue wanting a mortgage, as you're paying for the convenience of having it now. That cost to you is the interest.

If you're willing to pay the ~$75k interest on a $200k house over 30 years (been a while since I looked at the numbers, I could be off a bit), then that's fine. The problem is when money gets tough for people, they put the problem onto their lenders rather than making sacrifices for themselves. This is where you can't afford it comes in.
 
GT1999 said:
I do. Just don't be an ass about it. 😀
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I'm not trying to be, but it might come across that way (sure)

It's called a gap in communication over the internet.

The reason why I go with 20% down rule is simply because if something happens you have SOME equity and room to move on.

If you put down 5% on a house and shit hits the fan, you will actually owe money by the time you sell your house. 20% gives you certain safety net and it has been a standard in Mortgage industry for years (prior to our government deregulating and banks handing out money).

It's financially responsible to do it that way.
 
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I would never rent long term. If you are paying rent you are probably paying more than the payment on the place other wise how would the owner make any money. So, go get a loan and buy a place like you rent. It is nice to have 20% to avoid PMI, but throwing money down the drain renting is worse than only having 5% down in my book. Sure if you lose your job owning a house can be worse than renting, but most people don't lose their job even in today's world. And either way you are homeless. Actually you will become homeless faster if you rent. The landlord will kick you out before a bank will. Plus assuming you don't lose your job the year you buy they house and market stays the same you will have some equity where as renting you have nothing. Also if you buy a house you can rent a room or the whole house if need be.

But taking any loan is a gamble. It just depends on how risky you are. Some people risk everything while others pay cash for everything and store all of it under their mattress. So, do what feels right to you.
 
Vdubchaos said:
How long have you been renting?

How much money have you saved during that time.

Based on your numbers you should be saving good 6-7k a month during your rent.

1 year to have 20% down payment.

What's the problem?
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why "should" i have been saving 6-7k a month?
 
Vdubchaos said:
I hope you realize I'm just trying to help you.

I want (and THINK I have a need) for MANY things in life. All of that is worthless, what I can actually afford is what matters.

🙂

We all want things we can't have, human nature.
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the problem is that you are trying to tell people what they can and can't afford, based on your current situation. i've already explained how i can afford to pay for a home in my current situation, and can still live the same lifestyle that i currently live.
 
mmntech said:
UK? Yeah, it's pretty bad in Europe now. Problem where I am is there's a lot of urban sprawl. City folk are moving to the outlying areas and causing a lot problems in places that were small towns only a decade ago. Low mortgage rates have created a housing bubble. Supply can't meet demand and it's driven prices up astronomically. What was a $350k house ten years ago is now $500k. I'm hoping for a correction soon. Prices just rose too much over too short a period. The government just passed a law requiring mortgages be maximum 25 years at 20% down. A lot of people were getting into the market at as little as 5% down with 30+ year mortgages to afford their half million dollar homes. It was creating a bit of a houshold debt crisis since people can't weather rate increases. The other issue is Generation Y is now starting to get to home buying age and are finding they can't afford to enter the market. So that should trigger a drop in demand, and a drop in prices.

It's worse out in Vancouver. The average price for a typical suburban two story home is almost a million out there. Only the wealthy can own property out there. Has to do with rich foreign investors going on a property buying spree. Nobod owns out there. Just rents. Rents are as much as a mortgage payment for a nice house here. Vancouver is one of those places I've never got the appeal of. Everyone I know that's actually lived there for awhile says it's an awful place.
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I am in Vancouver. The prices are still insane here, even though they are trying to say it is now a "buyer's market". I'm glad we bought and sold in May/June and just don't need to worry about it anymore. Paid slightly more than we wanted to, but looking at the comps we did ok.

KT
 
Let's see

You are currently paying $1500 a month for rent correct?

You said you can save 4-5k a month while making $2300 mortgage payment

So you should be able to put away 5-6k a month.

Figure 1.5 years to have a nice downpayment.
 
Vdubchaos said:
Let's see

You are currently paying $1500 a month for rent correct?

You said you can save 4-5k a month while making $2300 mortgage payment

So you should be able to put away 5-6k a month.

Figure 1.5 years to have a nice downpayment.
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no i said i would have $4k - $5k left over after paying mortgage + all bills (and retirement), didn't say i would be saving that much.
 
Vdubchaos said:
you sure did



:colbert:
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where did i say i'm saving that money? i said that is for bills, you know, the normal montly payments you have, and i specifically included retirement savings in there, since that isn't a bill (even though it is taken out the same amount every month).

didn't say anything about how it is used for entertainment, buying shit i want to buy, food, gas, saving for vacations, etc.

l2r before you start talking like an ass (although it's a little too late for that in this thread).
 
purbeast0 said:
try harder bro, i started my new job Monday.

aren't you in NOVA too? that is where i just left my current job, down in Crystal City.

the job market is huge right now in the DC Metro area.
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Both me and my fiancee have great jobs and even we can't save 20%

I have noticed the cost of everything go up, especially food. And of course, gas.

We:
Never go out to eat, unless if you count $5-7 sandwich joints and even that's only 2-3x a month. We both pack our lunches.
One trip per year (only 1 trip in the 2 years we've been together...) where we didn't go out to eat very much
Don't gamble
Don't do drugs/alcohol/smoke
Cash in extra money from work (sick time from me which is $1k/year, she worked double bonus for two months straight, and I also do company stock at a discount which I've gained a lot from)
Don't have kids
Only have student loans and car debt, which for the most part are minimal

Who's supposed to be buying these houses again? I think we're going to see even more foreclosures, which is going to drive prices down even further. Lowering interest rates is the first part, but prices are going to keep going DOWN DOWN DOWN
 
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purbeast0 said:
try harder bro, i started my new job Monday.

aren't you in NOVA too? that is where i just left my current job, down in Crystal City.

the job market is huge right now in the DC Metro area.
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Fuck you.
You have no idea why trying hard is.
I been out to 20 interviews in the past year and every single one of them said you're great but not exactly what we're looking for.
 
Am only just starting school.

Before that I was a comm tech in the Navy, worked at Hynix in Photolithography, and Tektronix fixing oscilloscopes.
 
shortylickens said:
Fuck you.
You have no idea why trying hard is.
I been out to 20 interviews in the past year and every single one of them said you're great but not exactly what we're looking for.
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hah i wasn't trying to be a dick, just saying there are so many jobs in the DC area right now. granted i have no idea what your field is, but software dev there are so many jobs right now.
 
FYI, if you're going to have to pay PMI, it's MUCH cheaper (about half) for a 15-year loan than a 30-year loan. So, if you have to pay PMI, payments on a 15-year mortgage won't be that much higher than on a 30-year mortgage, especially once you throw in taxes and insurance. For me, a 15-year mortgage costs 28% more per month than a 30-year mortgage if I include taxes and insurance into the payment.

For the 20% vs. minimum downpayment, there are pros and cons either way. However, let's say it will take you 5 years to save 20%. It's a gamble to assume that both interest rates and house prices will be this low in 5 years, so you might spend more money in the long run by saving up for years in order to avoid PMI.
 
I'm tempted and have the funds, but as a single guy I want to have the option to get up and go anywhere in the next 5+ years. House is a no no.
 
so it's 1% lower than when we locked at 4.5% in Sept. 2010. So if we had gotten 3.5% back then, it would've saved us $156/month out of a $2400 monthly mortgage payment (includes property taxes). It's something, but no biggie. We're not taking all 30 years to pay this bitch off. Refinancing always has costs even if it's "free".
 
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I paid off my mortgage a while back with gains I made from stocks I had purchased during the bull market rally in 2009. Was perfect timing, as those stocks I sold to pay off my mortgage are now worth a third of their previous value. It's the best feeling in the world to no longer have a mortgage payment.
 
I also locked in at 3.4, coming from my original loan at 6.25% back in 2007 😀

They're covering my refi fees too, which is nice...crediting me 4% of the origination amount.

I am still way under water, but at least the monthly will be cheaper.
 
ViviTheMage said:
I also locked in at 3.4, coming from my original loan at 6.25% back in 2007 😀

They're covering my refi fees too, which is nice...crediting me 4% of the origination amount.

I am still way under water, but at least the monthly will be cheaper.
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which lender?
 
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