To Mortgage or Not to Mortgage (Pittsburgh, McKeesport: sale, real estate, second mortgage)

[PreservationPioneer]

Well, it looks like I sold my house. I have a few months to find my next house. It has to be in liveable condition. Beyond that, it has to be old and cool. I am willing to consider any neighborhood or outlying town, just as long as it's not more than a half hour to forty minute drive to East Liberty (work).

The big question is do I look for a house I can pay cash for (budget would be under $30k), or do I get a mortgage (not more than $50-60k) and get something a little better?

This is going to be a lot of fun and I'm very excited. Hopefully, I can find something really cool. For those of you not familiar with me, I am young, have no kinds, and love old houses. I don't care about being in a hip or trendy area. I just want to get the maximum bang for my buck, in terms of the most house I can buy (awesome, Victorian, old and haunted, whatever). Neighborhood is unimportant to me because I'm not trying to necessarily make a profit, and I like to be part of positive change in declining areas!

Some areas with cheap old houses that I am considering: Stowe / McKees Rocks (where I currently live and I like it), Natrona, Tarentum, Pitcairn, Turtle Creek, Wilmerding, Irwin, Apollo (how bad would that commute be?), East Deutschtown, Spring Garden, Spring Hill, Troy Hill, Sharpsburg / Etna / Millvale, McKeesport. I am priced out of most of the city, unless I want a vinyl sided shack, so I'm looking in a lot of the older small towns.

So throw some ideas at me!

[Moby Hick]

$30k is too low to find something liveable, old, and cool.

[PreservationPioneer]

Also willing to consider liveable, old, and uncool.

[Hopes]

I say mortgage it even if you find one for 30k. That way you'll have 30k from the sale of this home to start renovations right away. Then pay down your mortgage quickly by making extra payments with the money you won't need to use for renovations throughout the years.

[Hopes]

Originally Posted by Moby Hick

$30k is too low to find something liveable, old, and cool.

His definition of livable is different from yours.

[PreservationPioneer]

Originally Posted by Hopes

I say mortgage it even if you find one for 30k. That way you'll have 30k from the sale of this home to start renovations right away. Then pay down your mortgage quickly by making extra payments with the money you won't need to use for renovations throughout the years.

I have a house in mind, if I decide to go the mortgage route. I think I could get the house for around 45. It needs very little work, if any, and is move in ready. It's also beautiful! But mortgages scare me. Maybe someone can talk me into them. My parents, both extremely sensible with money, seem to think I should go the mortgage route and get the better house.

[eschaton]

This apparently needs major work, but it's not that far into the Hill District - basically a block away from Crawford Square.

I'd also consider this house in Marshall-Shadeland if I were you.

This house in Etna has retained much of the original woodwork. It looks to still have wood siding as well.

[doo dah]

This one is in an odd location:
643 Rising Main, Fineview, PA 15212 (MLS# 951555) - Fineview PA Real Estate - PittsburghMoves.com

Kind of cool though. Might be noisy, next to the highway.

[PreservationPioneer]

I love the house in Etna and the one on Rising Main. I looked at the one on California and it is extremely rough - not liveable. Incredible house, though. I wish the house in Etna still had the mantles. I think the one on Rising Main is overpriced for that location.

I'm looking at one of the circa 1850 company homes in Natrona later today.

[trackstar13]

Get a mortgage, put no money down and live the American Dream. Make sure to buy the maximum amount you qualify for and get a few new credit cards for any repairs.

Now back to reality mortgages can be very helpful, especially if you are like me and have very few tax deductions. My property taxes and mortgage interest are my major tax deductions currently and business expenses for traveling that are above and beyond what I get reimbursed pretty much make up the rest. Additionally, as someone who has bought a house with a mortgage and paid one off and got another mortgage with the same bank on a different house, I can say that mortgages help get you better deals on banking products. For instance, my bank recently offered me a very low interest rate home equity loan that I could take and deduct the interest from my taxes since it would be a second mortgage. I did not take the loan, but I have thought about it and at least it is an option. Additionally, I have a credit card with them that has a very low fixed rate and they even dropped the rate after I paid off my mortgage on the previous house. Finally, relatively recently my wife got a car loan through the same bank and they gave us the best rate I have ever heard of for a used car that we purchased and they told us it was because of our credit and positive banking history with them. In other words, you have the tax benefits along with the banking benefits. I hate that our society revolves around credit scores and banking history, but sometimes going into debt is a necessary evil. As a another example, my wife's credit score rose significantly when we finally paid off her student loans. I am not a finance expert, but I almost feel like if you pay cash for everything you are limiting yourself to a certain credit score range and many banks look at credit history just as much as the credit score. In other words if you never have any debt your options are limited and in my humble opinion, I would rather have tax deductible debt like a mortgage or student loans than other forms of debt.