house questions

How much do you think we should put down on a down payment? We moved back into my parents house (apt upstairs) to save money. Ideally, I would like to move out and buy a house next year. We should be able to have 40,000 saved. Is that enough? I know it should be 20% down.

Any tips or advice? What should we doing now besides saving, saving , saving?

Re: house questions

Well i totally believe you should have 20% or more i wouldnt ever pay PMI. Its also easier to get a mortgage when you are putting down 20% Of course this all depends on how much the home you want to buy is. But shoot for the 20% JMO

Re: house questions

We are putting down about 30% ... and it's still a pain. The larger your mortgage is, the higher your interest rate is gonna be. We have a jumbo and our interest rate is low, but not as low as non-jumbo loans.

Re: house questions

Ugh. I feel like well never be able to afford a house :(

What is a jumbo?

Re: house questions

We are looking into using the FHA mortgage of 3%. Yes you will pay PMI but for us its way more manageable and we want to lock in at these low interest rates!

Re: house questions

---

Posted by jackieee

Ugh. I feel like well never be able to afford a house :(

What is a jumbo?

---

any loan that's over $417k

Re: house questions

---

Posted by jackieee

Any tips or advice? What should we doing now besides saving, saving , saving?

---

Wish I had better advice for you... we moved to NC after the wedding last year and bought a house almost exactly a year later. We could never have afforded anything like the place we purchased up in NY. It's literally half the price (depending on where on LI you are, but I grew up in Great Neck). We bought a 2900 sq. ft house for well under $400k.

We put 1/3 down and locked in a fixed-rate 30 year mortgage at 3.375%. We pay $1400 a month for our mortgage, homeowner's insurance, and city taxes, total (mortgage itself is only about $1100 a month, but the other costs do add up). I used to pay $1600 for my one-bedroom rental in Park Slope. It boggles my mind.

As far as starting point goes... I looked online for a while, on Craig's List and on MLS and some real estate companies' websites to get an idea of houses in the area, price range, and turnover time. I probably spent 3 months looking online without setting foot in a house just so I felt really educated about the market.

When we were ready to start seeing homes, I told DH about a few Open Houses that looked promising for what we each wanted in a house (our 'wish lists' were a little different, but we compromise well). We happened to see a home we loved at an open house and that's when I went and spoke with a friend of mine from the gym who is a realtor. She was able to bring us back to that house, and to also show us about 6 - 8 other homes in the area that she thought we would like based on what we told her about the OH home.

Once we decided we still wanted the first house, she helped us put an offer on it. Her company has their own lending division so we had a mortgage pre-approval letter based on DH's earnings and our credits scores before we made the offer. Once the offer was accepted, the lending company found us the best rate for our mortgage and took the responsibility of selling it to a mortgage company (ours is with Chase right now, but it could change during the lifetime of our mortgage... our rate cannot). Going through a lending company can often give you the best rates. Because we put 1/3 down, we were able to save a good deal of money and don't need mortgage insurance.

Hope this helps! Good luck with your search! It can be an extremely overwhelming process but the reward of moving into a home of your own is incredible.

Re: house questions

we put 20% down to avoid paying PMI. but we both lived at home before getting married and thats the only reason we were able to save that much. so i think what you're doing is def a smart idea!

Re: house questions

I'm in the 20% or more camp. PMI adds up and so does the interest you have to pay on that bigger loan for the life of the loan. Don't forget that on top of the down payment amount, you'll need thousands of dollars for closing costs that'll you'll never see again and it would be safe to at least have a few months of emergency savings. God forbid one/both of you lose a job or something you'll still be able to pay the mortgage and expenses.

Re: house questions

Definitely try to put 20% down. In addition, you will need to come up with the closing costs (ours were about $14,000 if I remember correctly). Closing costs can no longer be wrapped into a first mortgage.

We bought our house one month before the wedding. We were worried about not being able to pay for the wedding, HM and the house, so when we applied for our mortgage, we only put 17% down, which meant we had to pay PMI. We 'made up' the other 3% within 4 months and by February, we no longer had a PMI payment!

Re: house questions

I am totally overwhelmed as I read this post...I feel like DH and I will never get a house. We were planning on putting about 30,000 down but that is not 20% (of what we'll be able to afford) But now I realize that will not be enough.

Being an untenured teacher, I never know if I have a job and DH lost his job last year.
...sad

Re: house questions

---

Posted by BrideC

I am totally overwhelmed as I read this post...I feel like DH and I will never get a house. We were planning on putting about 30,000 down but that is not 20% (of what we'll be able to afford) But now I realize that will not be enough.

Being an untenured teacher, I never know if I have a job and DH lost his job last year.
...sad

---

Sure 20% is the goal for a downpayment but im sureeeee there are plenty of people on here and outside LIW that have put down less and are doing just fine... You can get an FHA loan and put a minimum of 3.5%... Yes, you'll be paying PMI until you reach that 20% but IMO, its really not that big of a deal... I have an FHA loan and put down approximately 7%... Our PMI per month is an additional $100... really not huge in the grand scheme of things... Im happy just to own something... In our case, we bought a place that we could grow in - should we decide to have a family anytime soon - so we plan on staying here for a while... no worries about the market bc im sure by the time we go to sell, it'll be back up again

FM me if you have any questions