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In reply to jrw1621: That's a prudent plan.. In fact when I first started out with a mortgage paid based on my commission income that's exactly the approach I used..
Later on due to my diligence in saving I converted to a shorter term to save the higher interest rate. Lucky I did because it's only been my savings that helped pay for my home these last 4 years..
It was real easy to get the bank to rewrite the mortgage at the new lower rate and for 30 years..
slopecarver wrote:Pardon my lack of direction in this post. What's grinding my gears is that closing costs are so high compared to the down-payment. A 3.5% down mortgage will actually require more like a minimum of 5% down after including the 1% loan origination fee and a few other fixed costs even when the seller is covering closing costs. I'd need about $10,000 saved up to get into a place of my own. I have not much saved up but I just started living on my own after college in October with a real career as an engineer . Renting is killing me (because I'm not getting anything out of it as an investment or even as equity control for when the market goes up) but so would the rates and interest on a low down-payment house. I think I'll keep paying my share of the rent on a 2/2 apt with a roommate at $650/month but I really want a garage GRRRR.
Talk to someone about a zero point mortgage - should be entirely possible to get into a home for just the 3.5% downpayment on the FHA loan with the seller paying other costs.
slopecarver wrote:It's a fact.. you need to get over it and buy.. To keep things really simple the average renter has virtually no real nest egg.. while the average home owner has equity over $123,000 (even in the low market of today)Pardon my lack of direction in this post. What's grinding my gears is that closing costs are so high compared to the down-payment. A 3.5% down mortgage will actually require more like a minimum of 5% down after including the 1% loan origination fee and a few other fixed costs even when the seller is covering closing costs. I'd need about $10,000 saved up to get into a place of my own. I have not much saved up but I just started living on my own after college in October with a real career as an engineer . Renting is killing me (because I'm not getting anything out of it as an investment or even as equity control for when the market goes up) but so would the rates and interest on a low down-payment house. I think I'll keep paying my share of the rent on a 2/2 apt with a roommate at $650/month but I really want a garage GRRRR.
Don't be confused.. that is the average.. Not some young starting college grad but includes fat old guys like me who have been in my house for 3 decades..
You can do it with nothing but a promise to take over payments.. No it won't be easy.. you'll need to work with dozens of banks to find the small one willing to help you out. No realtor will hold your hand and make things all nice and easy.. But in exchange you'll get years ahead of those who just wait.
The process is looking for a homeowner about to be foreclosed on.. Then go tell him you will take over payments. The result is it will help him save his credit rating and allow him to start over in the future.. Then go ask the bank if you can. The bank likely won't do it unless the house is underwater.. (that means more is owed on it than the property is really worth {right now}).
You should do it even if the house will cost you more than it's worth.. Here's why..
There is a big tax benefit to owning rather than renting.. In my case it's worth thousands of dollars per month but a starter home it may only save you a few hundred dollars per month..
You can legally claim more dependents to help make higher mortgage payments if you will owe less as a result of the purchase of the House.. For exact details on how this works ask either the IRS, or a tax preparer.
Finally right now banks require 20% down to get a mortgage.. Take over payments or rent to own are two ways to acquire property without the closing costs down payments etc..
