First Time Home Buyer

[gaash2]

Originally Posted by doggiebus

I agree keep saving, you want to put 20% down when you buy something.

I agree the OP should keep saving; he does not have enough reserves right now to be a home owner, in my opinion. However, I totally disagree about putting 20% down. Right now borrowing is very cheap, it is worth money borrowing. These rates may not be here forever and even if rates do continue to go down, if they move down a lot, you can just refinance into lower rates. Furthermore, in the worst case, if tallrick is right and real estate collapses, you can just walk away having lost less money.

[tallrick]

Originally Posted by gaash2

I agree the OP should keep saving; he does not have enough reserves right now to be a home owner, in my opinion. However, I totally disagree about putting 20% down. Right now borrowing is very cheap, it is worth money borrowing. These rates may not be here forever and even if rates do continue to go down, if they move down a lot, you can just refinance into lower rates. Furthermore, in the worst case, if tallrick is right and real estate collapses, you can just walk away having lost less money.

Agreed 100%. If you can borrow cheap it's just like renting from the bank, when the market collapses you can decide to stay or walk away. Best of all you have no assets that someone can go after if the lender is on the hook. Just watch out for sneaky statements to the IRS if they discharge the debt.

[gbugmiami]

The people that just bought my house, only had to come up with 1% of their own money to do so. They pay now less in mortgage than they were paying to rent a 2 bedroom appt. I think they got 6k from miami dade for first time homebuyers towards down, and clsoing cashback from me.
I agree, i woudln't buy it to attempt to rent it for 2 years.

[hurricaneMan1992]

Originally Posted by gbugmiami

The people that just bought my house, only had to come up with 1% of their own money to do so. .... I think they got 6k from miami dade for first time homebuyers towards down.

Buying a house with 1%, that's incredible, that's like paying a security deposit for an apartment!!! However, if that's *all* the cash they've ever been able to save up, they're going to be hurting when something breaks.

$6k + 1% down sounds like the price was around the upper 100's to lower 200's. Personally if I had an income that qualified for down payment assistance (less than 140% of median, I believe), I'd be looking at a much more conservative price range. I like to leave room for inevitable increases in insurance, taxes, and city service fees. I don't blame anyone for taking advantage of what's available though.

[gbugmiami]

yep. Im not saying it was a good or bad idea or plan on their part, just that it happens, and i think every financially responsible person that wants to own a home, should work towards it. Not just listen to what some say online. These folks did it, and it was the right thing for them. I do agree with Gaash, 8k isnt enough to buy much (anything) down here, even lets say with the dream scenario the people i mention were in.

[tallrick]

Honestly there is no reason to be responsible. Just borrow to the max and leverage it up. People who are prudent and responsible are the enemy. Big Government wants real estate inflation so they can get more in taxes. The Fed hates responsible savers so it cheapens money. Only a fool tries to buy something at a reasonable price with money they worked for. Do not be a fool, borrow and default.

[tonyff67]

My first home purchase was a duplex. I qualified for the first time buyers program, but I lived in one side and rented out the other.
It may be something you want to consider. My share of the mortgage, after collecting rent was $100 per month. I saved a ton of money and by living here, I was able to keep an eye on he place.

[gbugmiami]

Thats a great way to do it tony. Much better having people pay your mortgage than you paying someone elses...

[straight shooter]

Originally Posted by tonyff67

My first home purchase was a duplex. I qualified for the first time buyers program, but I lived in one side and rented out the other.
It may be something you want to consider. My share of the mortgage, after collecting rent was $100 per month. I saved a ton of money and by living here, I was able to keep an eye on he place.

Smart approach, the only negative that I see is that your tenants live right next to you. That could create tension if they don't pay or are problematic people.