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Old 11-17-2014, 04:36 PM
 
772 posts, read 909,415 times
Reputation: 1500

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Hello everyone.

I purchased my house in 2008 for $158,000 , today I owe $148,000. Zillow says my house is worth $175,000

I beleive I would be lucky if I got $160,000 and would take that and run in a heartbeat. My monthly payment with pmi, insurance, taxes is $1220

I think I could break even if I rented ?

What's it like renting a house you own ? I don't have any emotional attachment, but would hate to have "nightmare" tenants that may cause a lot of headache...

I like the idea of renting, for the additional income someday once the house is paid off. Yet I have no idea what I'm getting into ?

Part of the reason for renting, is I don't feel confident enough in it selling for enough.

I want to move, because I am 29, live in GF just had a daughter (10 months ) and this is not where we want to spen the golden years of our daughters child hood. We want more privacy, more land maybe 3 acres to enjoy north of the cities.
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Old 11-17-2014, 05:51 PM
 
8,544 posts, read 12,311,430 times
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Quote:
Originally Posted by 191185 View Post
What's it like renting a house you own ? I don't have any emotional attachment, but would hate to have "nightmare" tenants that may cause a lot of headache...
Unless you really have a business desire to become a landlord, I don't recommend becoming an accidental landlord. Although being a landlord can work out, it is also fraught with peril. If you only rent out one house, you may be able to keep up with all that is needed...but you also put yourself at greater risk should you get a bad tenant who doesn't pay for a while, or worse, trashes the place.
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Old 11-17-2014, 07:12 PM
 
13,194 posts, read 28,176,343 times
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Why have you only paid down your mortgage $10k in 8 years? No down payment? Bad credit/ high interest rate? Home equity loans?

Spend some time on the personal finance forum before becoming a landlord and buying a second property you don't need. Your daughter won't have any long term memories of where home was until she's about 4 or 5.
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Old 11-17-2014, 07:19 PM
 
Location: El Dorado Hills, CA
3,720 posts, read 9,968,002 times
Reputation: 3927
Ask a local agent about how much your house is worth. If you can walk away with some cash, would you use it as a down payment on another home?

Ask about timing. Would it sell for more in the spring/summer than now? How much?

And inquire about local rents and prices for property managers. A good property management company can take away much of the headache of being a landlord. But the rent minus their fee still needs to fully cover all your expenses. Don't get in a cash negative situation.

Also, your total monthly cost seems really high for the mortgage amount. Can you refinance for a lower rate? Will it appraise enough to get rid of PMI? If so, do that before considering renting it out as there are different rates for investors vs. owner occupants.
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Old 11-17-2014, 07:32 PM
 
772 posts, read 909,415 times
Reputation: 1500
Quote:
Originally Posted by TurtleCreek80 View Post
Why have you only paid down your mortgage $10k in 8 years? No down payment? Bad credit/ high interest rate? Home equity loans?

Spend some time on the personal finance forum before becoming a landlord and buying a second property you don't need. Your daughter won't have any long term memories of where home was until she's about 4 or 5.
I purchased it with 0 down @ 4.5%, I beleive I qualified for first time home buyers credit and was given 3% down through a grant. No home equity loans. I have very good credit.
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Old 11-17-2014, 07:36 PM
 
772 posts, read 909,415 times
Reputation: 1500
Quote:
Originally Posted by NinaN View Post
Ask a local agent about how much your house is worth. If you can walk away with some cash, would you use it as a down payment on another home?

Ask about timing. Would it sell for more in the spring/summer than now? How much?

And inquire about local rents and prices for property managers. A good property management company can take away much of the headache of being a landlord. But the rent minus their fee still needs to fully cover all your expenses. Don't get in a cash negative situation.

Also, your total monthly cost seems really high for the mortgage amount. Can you refinance for a lower rate? Will it appraise enough to get rid of PMI? If so, do that before considering renting it out as there are different rates for investors vs. owner occupants.
I beleive my monthly payment is high. My home insurance is 1400 / year

My pmi is 60 - 80 I think.

And property taxes are 2200

Interest rate 4.5

30 year fixed

My friend just bought a house for $239,000 with 3% down and pays $1440 with everything

Not sure what I'm doing wrong ?
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Old 11-17-2014, 07:43 PM
 
772 posts, read 909,415 times
Reputation: 1500
Quote:
Originally Posted by NinaN View Post
Ask a local agent about how much your house is worth. If you can walk away with some cash, would you use it as a down payment on another home?

Ask about timing. Would it sell for more in the spring/summer than now? How much?

And inquire about local rents and prices for property managers. A good property management company can take away much of the headache of being a landlord. But the rent minus their fee still needs to fully cover all your expenses. Don't get in a cash negative situation.

Also, your total monthly cost seems really high for the mortgage amount. Can you refinance for a lower rate? Will it appraise enough to get rid of PMI? If so, do that before considering renting it out as there are different rates for investors vs. owner occupants.


Generally is it higher rate if I was looked at as an investor ? Or lower rate ?

Last edited by 191185; 11-17-2014 at 07:53 PM..
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Old 11-17-2014, 09:15 PM
 
Location: Mostly in my head
19,855 posts, read 65,665,464 times
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Higher. Plus you have to change your homeowners insurance to show it's a rental - also higher.
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Old 11-17-2014, 09:57 PM
 
2,283 posts, read 3,842,816 times
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Quote:
Originally Posted by 191185 View Post
I beleive my monthly payment is high. My home insurance is 1400 / year

My pmi is 60 - 80 I think.

And property taxes are 2200

Interest rate 4.5

30 year fixed

My friend just bought a house for $239,000 with 3% down and pays $1440 with everything

Not sure what I'm doing wrong ?
Something is off. You should be closer to $1100 all in, and your PMI should be done, or really close to done?

Did you have closing costs rolled into that loan?

Regardless, I'd have a realtor come out and do a CMA. Can't hurt to get an actual estimate to use in the decision making process. Zillow is a waste of digital space.
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Old 11-17-2014, 10:26 PM
 
Location: El Dorado Hills, CA
3,720 posts, read 9,968,002 times
Reputation: 3927
Well it adds up. Do you shop your insurance often? That sounds very high for the price of home. The rates are lower now, but pmi is higher unless you have 20% equity. Get a CMA from a realtor. If you decide to keep it and you have 20% equity now, you should look into refinancing. Could save a couple hundred a month...or get a shorter term loan for same $$.
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