[Daddys///M3]

Originally Posted by drinkme

Thank you for this well thought out advice.

I doubt we will ever "recover". We have reached a new low in political corruption, and the country/world will never be the same. I hope I am wrong, but I just don't see how things can get better???

That said, if I wait to buy something, and a miracle happens... then I am again left out of the market. If I buy, and things get worse, then what does it matter that I am another foreclosure statistic? The country will be in tatters anyway... might as well have a stake in the pain... having stacks of worthless dollars laying around won't make me feel better about it.

Perhaps I am being foolish & pessimistic about it all, but there just isn't a precedent for this situation. Believe me I have lost many nights of sleep over the state of affairs, and have developed quite the drinking habit

Agreed. Although I try to stay positive, one can't help but think "what if" in the back of their mind. Expect the worst, hope for the best.

Originally Posted by lasto

I appreciate the insight. I'll give you the low-down on my master plan (no affiliation with the aforementioned deutches reichstadt mark o_O); I'm in the Air Force so I'm about 98% sure of my job security, currently in Germany for another month then I'm off to Honduras for one year while my wife goes to Tucson, upon my return I'll be stationed with Vegas bringing the wife with. While in Hondo I'll be saving up a nice chunk of change to put towards purchasing a house in Vegas with a VA loan. I know I don't need a down payment but I also know that I can get better rates with a decent savings account as well. Now I'm wanting to stay in LV for as long as I can (at least 8 years, preferably longer). So I'd like to use my housing allowance towards a mortgage payment as opposed to just dwindling it away with rent especially since my wife and I would like to stay in LV indefinitely. So what I am thinking now if now is the absolute best time to buy a house is going ahead and jumping on that band wagon and my wife stays in the purchased house in LV instead of back in Tucson. It's a gamble. Go figure.

I've been perusing this forum for months now and only just started getting active. So I'd like to throw a thanks out there for all the people throwing in the great information so people like me are in the know when transplanting in Vegas.

I think an 8 year time frame should be plenty to see some upward movement (unless the entire system collapses then God help us all).

Just as an aside, VA rates are what they are. You will get the same rate with a 620 FICO and no money down than you will with a 800 FICO and 30% down (below 620 FICO and you may see some pricing hits however). Rates will differ between lenders though. What a larger down payment will help you with is a reduced funding fee. With 5% down the funding fee goes from 2.15% for regular military first time user to 1.5%. For 10% or more down the funding fee is 1.25% (again, regular military first time user). The funding fee for subsequent use or reserves is higher.

[lasto]

Originally Posted by Daddys///M3

Just as an aside, VA rates are what they are. You will get the same rate with a 620 FICO and no money down than you will with a 800 FICO and 30% down (below 620 FICO and you may see some pricing hits however). Rates will differ between lenders though. What a larger down payment will help you with is a reduced funding fee. With 5% down the funding fee goes from 2.15% for regular military first time user to 1.5%. For 10% or more down the funding fee is 1.25% (again, regular military first time user). The funding fee for subsequent use or reserves is higher.

Ahh now that is very interesting. Do you think VA would be the way to go if I were to put down 10% and a FICO in the 700 range? Or could one do better without it?

[Daddys///M3]

Originally Posted by lasto

Ahh now that is very interesting. Do you think VA would be the way to go if I were to put down 10% and a FICO in the 700 range? Or could one do better without it?

Of course I am assuming you are an eligible veteran of a regular branch of the military and not reserves. I'll break it down for you in three seperate scenarios. These are examples so they may not be very accurate. However, the rates are deliverable rates as of today and the purchase price, the assumptions on the taxes and insurance, will all be the same so for comparison purposes this should be solid.

VA loan:
Purchase price: $200,000
Loan amount: $180,000
VA funding fee: 1.25% ($2500)
Total loan amount (assuming the VA funding fee is financed): $182,500
Rate: 5.25% (as of today, obviously this can change)
Monthly P&I payment (principal and interest): $1007.77
Taxes (assuming a 1.25% tax rate): $208.33 a month
Homeowners insurance (assuming a 0.3% premium): $50 a month

Total monthly outlay (assuming no HOA, master planned fee, or SIDS/LIDS): $1266.10

FHA loan (assuming the same 10% down):
Purchase price: $200,000
Loan amount: $180,000
FHA UFMIP: $3150
Total loan amount (assuming the UFMIP is financed): $183,150
Rate: 5.25%
Monthly P&I payment: $1011.36
Monthly mortgage insurance: $82.50
Taxes: $208.33
Homeowners insurance: $50

Total monthly outlay: $1352.19

Conventional loan:
Purchase price: $200,000
Loan amount: $180,000
Rate: 4.875%
Monthly P&I payment: $952.57
Monthly mortgage insurance: $93
Taxes: $208.33
Homeowners insurance: $50

Total monthly outlay: $1303.90

[Daddys///M3]

Originally Posted by Daddys///M3

That being said, I believe that in the second half of this year we will start to see rates climb again (not these small 0.5%-1% fluctuations but a steady rise in average rates to the tune of 2%-3% although gradually). The quantative easing effort the Treasury is using to keep mortgage rates low right now (MBS purchases) will likely be tapped out towards the middle of the summer.

Scratch this. Fed announced that it would increase it's quantative easing effort by throwing another $750 billion at the MBS market, along with the $300 billion that has yet to be spent plus the $200 billion that has already been spent, for a grand total of $1.25 TRILLION dollars. If that doesn't bring rates down, I don't know what will.

[lasto]

Thanks a lot for breaking it down like that M3. I'm looking for just about a $1300 a month payment and I definitely didn't have the full picture on what would go into my monthly payments. Again many thanks on taking the time.

[jjameson922]

Losing sleep and drinking too much over this situation is pure folly. It will be what it will be. The only thing different is the next day you will be without sleep or hung over. It is something we have no control over. All you can do is live each day wisely as it comes.

[Wing Feathers]

Originally Posted by jjameson922

It is something we have no control over. All you can do is live each day wisely as it comes.

Thank you for the dose of wisdom

[lasto]

Originally Posted by jjameson922

Losing sleep and drinking too much over this situation is pure folly. It will be what it will be. The only thing different is the next day you will be without sleep or hung over. It is something we have no control over. All you can do is live each day wisely as it comes.

Haha my wife tells me pretty much the same thing every time she catches me surfing realtor.com or the review journal classifieds. I'm definfintely one to get pretty wrapped up in these things.