[Muggy]

To the discontent of some on this board, the housing market is not dictated by "negativity," but reality (namely affordability).

Dee & Bamboo, I like you both and have read many of your posts. I believe both of you are good peeps, but at the end of the day we have to "shoot straight."

That both of you have vested interests in Florida real estate is irrelevant; the market is at serious risk for catastrophe and nobody on this board can stop that.

[cltsig]

Getting back to the title of this thread, I just recently sold my house in Pasco county north of St. Pete. Here are the stats:
-paid roughly 250k for it in early 2004
-original listing in 02/2006 (2 year capital gain point) was for 407k. Pie in the sky, but what the heck. We based this on what was for sale, not what has sold lately.
-April-ish lowered to 389k. A few showings, nothing to speak of.
-May-ish lowered to 375k. A few showings, nothing to speak of.

June - received offer for 365k and we pay up to 14k of closing costs. We countered at 369/14k and it went under contract. It closed in July with us paying 11k in closing, not the original 14, so we received about 100k over what we paid 2 years ago. Not too shabby!

Our mindset was "Well, we're still coming out ahead by quite a bit and it's tax free." instead of "We just lost 40k by not getting 400k, so now we can't buy that new BMW". Readjust, lower your price to early last year's price and it will sell. Pricing is the biggest thing. Our house was also extremely clean, landscaped and marketed well.

[elfyum]

You can afford a 200k house on 40+k a year. You all either have kids or waaaay too many "toys"!!!

[Dee2e]

Originally Posted by elfyum

You can afford a 200k house on 40+k a year. You all either have kids or waaaay too many "toys"!!!

When I seek preapproval for clients, the major issue is car leases or high payments and credit card debt. Credit card debt is increasing at alarming rates. That is the biggest issue that causes lenders to deny a loan or to make the loan at a higher interest rates.

It's my opinion that credit card debt will be the cause of a crashing economy. And the sad thing is that most credit card debt is for short term consumable products and services like video rental, movie tickets, concert tickets, pizza, beer, gas, tobacco products, coffee, lunch, etc.

Many refinance their home to clear the debt then run up the cards again! It's a vicious cycle.

Make 2 late payments on a card and you are paying 24.99% interest or more in most states! People don't get that you'd have so much more spendable cash without that high debt. But clearing debt takes work and discipline. At some point you have to bite the bullet and stop using cards and pay down the debt.

[Dee2e]

Originally Posted by mystree66

But you would probably be stuck with a predatory loan or an ARM that you may not be able to afford later and possibly have trouble refinancing later.
Way to risky to buy too much house imho. Then throw high property taxes and high insurances on top of it..ouch.
7500 a month is 90000/yr and if your credit is good enough,so yeah firemans pretty close.

Typo on my part, I apologize for that. Here is what I meant to post.

Actually, you need total combined annual income of about $75000 for a $250000 loan and you could get 100% financing with good credit.

[mystree]

Of course key word good credit not mediocre,and yes lack of credit card debt and car payments ect.

[mystree]

It's my opinion that credit card debt will be the cause of a crashing economy. And the sad thing is that most credit card debt is for short term consumable products and services like video rental, movie tickets, concert tickets, pizza, beer, gas, tobacco products, coffee, lunch, etc.

Many refinance their home to clear the debt then run up the cards again! It's a vicious cycle.

Make 2 late payments on a card and you are paying 24.99% interest or more in most states! People don't get that you'd have so much more spendable cash without that high debt. But clearing debt takes work and discipline. At some point you have to bite the bullet and stop using cards and pay down the debt.

I totally agree there

[Dee2e]

Originally Posted by mystree66

Of course key word good credit not mediocre,and yes lack of credit card debt and car payments ect.

You can have debt, just not massive debt. For instance, a car payment that is proportional to income is fine. However, financing a BMW via a lease when you make $35K a year is not reasonable.

With credit card debt, if you have two or three cards with balances that are less than a third of the total credit limit and are paying more than the minimium payment each month it looks better than having many cards maxed out and only making the minimium payment.

You have to have credit but you have to be creditworthy. Credit scores in the 700s gets you a better rate than scores in the 600s. Those in the 500s are about to get a loan but the terms are very poor.

I see many with derogagory marks that are for less than $200 worth of debt that could easily paid off. One gal told me the other day that she is just not paying a bill ($178) because she's mad at the company. For three years, that thinking has lowered her score. Creditors think that if you are unwilling to pay $178 to clear your name, then what will you do with higher amounts you owe?

Everyone should get their credit report (it's free) and review their report frequently. You can get it from each of the three reporting agencies once a year. Get one now, clear up items that are not correct, get another in 3-4 months and the last 8-9 months from now. Keep on that schedule and monitor your credit. https://www.annualcreditreport.com/cra/index.jsp

Most people would be surprised to know how many things are misreported.

[mystree]

Don't close too many accounts at once..I did this went from a 725 down to a
660 about 5 monthes later Im almost to a 700 again,1 second to lose,months to gain it back.

[Dee2e]

Originally Posted by mystree66

Don't close too many accounts at once..I did this went from a 725 down to a
660 about 5 monthes later Im almost to a 700 again,1 second to lose,months to gain it back.

Good advice!

The worse accounts are those small store accounts, like a computer store account, or those ones that suck you in to open them by giving you a discount. Best to stick with a bank Visa/Mastercard/Discover/AmEx cards.

Rates are better too!