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Old 03-04-2018, 10:24 AM
 
Location: New Britain, CT
892 posts, read 402,004 times
Reputation: 1418

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Quote:
Originally Posted by Diana Holbrook View Post
What are you afraid they going to spend ten or thirty grand on?
You mis-read my statement. My fear is that instead of the seller fixing the items as a condition of completing the sale, the kids knock ten grand off of their accepted offer and assume liability for the repairs (if the bank lets them). If the repairs end up being $30K they lose big time. If the repairs are only ten grand, THEY DON'T HAVE THE TEN GRAND to fix them. I'm told they have $19k to put down which pretty much taps them out. They need $800-$1200 for a washer/dryer, a lawnmower, window treatments, interior paint and supplies, backpack leaf blower, and we found out that the "new roof" appears to only be the high roof, not the low roof. They close then have to spend $4,000-$5,000 to make the house move in ready. They don't have the money for these items either.
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Old 03-04-2018, 10:37 AM
 
Location: New Britain, CT
892 posts, read 402,004 times
Reputation: 1418
Diana,

If you had a buyer couple, grossing between $60-70k, $19k to put down which would tap them out, would you advise them to take on a $220,000 mortgage and taxes and PMI and insurance? Keep in mind that most of CT real estate is on life support. So bad that if they want/need to sell in 5 years, they may not break even. My wife (boy's mother) used to be a realtor. The last crash killed her job and any prospects of staying in the business. CT has NOT recovered. These kids have NOT looked at a single house for sale that was still occupied in 6 or 8 months. They are ALL empty.
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Old 03-04-2018, 10:45 AM
 
Location: Rochester, WA
8,355 posts, read 5,005,464 times
Reputation: 22044
Quote:
Originally Posted by JimG2 View Post
You mis-read my statement. My fear is that instead of the seller fixing the items as a condition of completing the sale, the kids knock ten grand off of their accepted offer and assume liability for the repairs (if the bank lets them). If the repairs end up being $30K they lose big time. If the repairs are only ten grand, THEY DON'T HAVE THE TEN GRAND to fix them. I'm told they have $19k to put down which pretty much taps them out. They need $800-$1200 for a washer/dryer, a lawnmower, window treatments, interior paint and supplies, backpack leaf blower, and we found out that the "new roof" appears to only be the high roof, not the low roof. They close then have to spend $4,000-$5,000 to make the house move in ready. They don't have the money for these items either.
You're right that taking money off the purchase price doesn't give them the cash to fix it. That's an issue they need to think about in negotiations. Much better to have the work done now if they don't have a lot of cash to fix things themselves.

But I'm not seeing 10 or 30 grand in repairs that need to be done right now. That's what I'm asking you. What are we missing?

$19K in cash to put towards a new home is way better than average, dad... some new home buyers buy with much less. If they can hold some back to take care of a few immediate things, then great, that's a good thing to advise them to do.

You don't NEED $800-1200 for a washer/dryer. You can find nice used washer dryers for $200 or less.

Lawnmowers, same thing. They can buy a used push mower... You didn't mention it, but same with furniture.

The interior paint didn't look like it NEEDED to be done immediately, they can do this as they want... when they can... for hundreds, not thousands.

Backpack leaf blower? Nice if you want to buy them one, but not something they NEED.

The roofs look to be the same roofing in the pictures and in the aerials... why do you think they're not the same vintage?

Why do they have to spend $4-5000 to make it move in ready? They have to spend that on what?

You are being a good dad to ask them to consider some cost issues... really! But your credibility and motives come into question when every issue is exaggerated.
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Old 03-04-2018, 10:54 AM
 
Location: Rochester, WA
8,355 posts, read 5,005,464 times
Reputation: 22044
Quote:
Originally Posted by JimG2 View Post
Diana,

If you had a buyer couple, grossing between $60-70k, $19k to put down which would tap them out, would you advise them to take on a $220,000 mortgage and taxes and PMI and insurance? Keep in mind that most of CT real estate is on life support. So bad that if they want/need to sell in 5 years, they may not break even. My wife (boy's mother) used to be a realtor. The last crash killed her job and any prospects of staying in the business. CT has NOT recovered. These kids have NOT looked at a single house for sale that was still occupied in 6 or 8 months. They are ALL empty.
Usually the conversation about budget and limits happens with their lender who is more qualified to advise them, but at your worst case, $60K, they are grossing 5K a month, more or less... A 220K mortgage is about 1K a month, perhaps 1500 with tax and insurance figured in. Lots of people are living well on less than that.
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Old 03-04-2018, 11:00 AM
 
Location: Salem, OR
14,601 posts, read 35,145,113 times
Reputation: 14211
Quote:
Originally Posted by JimG2 View Post
1) More so than lots of boys his age will do.Have to give him kudos for that. I'm pretty suspect of the entire relationship though. She is one of around 8 or 9 kids that her father made, and she hasn't even met them all. Really hoping that she doesn't become her mother. A couple has to do what it has to do, but working different shifts is not a healthy relationship.
I've been married for 27 years and there was a period of time when the kids were small that we did exactly that. We survived it. They may or they may not. Millennials don't value marriage in the same way that the boomer generation does and so you have to decide if you can accept that their values are different than yours.

Quote:
Originally Posted by JimG2 View Post
I'm afraid that they are so wrapped up in THIS house, that they will buy it no matter what and suffer the consequences. Wife said that they have $19,000 to play with...... That's IT. Will tap them out and if they use it all on the down payment they basically have nothing for move in expenses, like the washer/dryer, lawnmower, curtains, paint. $240,000 accepted offer. Between the two of them they gross $60-$70k combined..... get out your calculators.....Would you do it? $220k mortgage, PMI, 4 grand in property tax. Not the best cities these days, but there are two small cities closer to his work where they can buy a 1,000 ft ranch for around $100k.... 2 family for $150-175k with an income generating apartment, and two dads who rent anyway. Instant tenant.
I'm pretty impressed that a 21 and 22-year-old have $19k "to play with." I have to tell you I see 35-year-olds that don't have that kind of savings who buy homes. They sound like they might know how to live frugally.

Not everyone wants to be a landlord. Especially with their current situation working different shifts and staying home with their little one. I can see them wanting to pass on that.

As for whether or not it is a bad financial idea to get into more house now than you might need...

You said he was an apprentice pipefitter which is generally, what, a two-year program? After that his hourly rate will likely jump and he will make more money. So if they push their comfort level now, live frugally, but don't have to move again, they might be financially ahead if they do it this way. You see doctors do it all the time. They are house poor for a few years and then their income increases and they can live more comfortably. Is it possible that it their intention? Be a bit house poor for a couple of years and then as he finishes his apprenticeship he makes more money so they aren't house poor anymore?

You are running the math for today, but what will the math be when he is done being an apprentice?
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Old 03-04-2018, 11:42 AM
 
Location: Florida
21,080 posts, read 21,764,055 times
Reputation: 25532
Quote:
Originally Posted by JimG2 View Post
Preaching to the choir here. I try telling my wife and she doesn't pass on my thoughts..... I think she is emotionally wrapped up in this deal too, and she used to be a realtor, so she should know better. My fear is that instead of having the seller fix the major issues, the kids are going to offer a reduced price instead, only to find out after it's a done deal that what they thought would cost ten grand to fix ends up being thirty grand, and too late, no recourse. And even if it is only ten grand, they aren't going to have the ten grand to pay for it.

And for whomever was asking, sounds like the mold is in the attic, from the bathroom fans venting into that space, not to a roof jack.
Perhaps your wife is thinking with a clearer head than you. You have exaggerated quite a bit and injected what you prefer rather that what your kids may want.
I do stick with thinking the under-producing well is a concern and it needs to be clarified as to what the actual situation is.
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Old 03-04-2018, 03:22 PM
 
Location: Georgia
4,574 posts, read 4,555,696 times
Reputation: 15858
"This is how we learn . . ."

The only thing you can do is point out areas of concern. After that, it's up to them. It may be a mistake, or it may be a jewel in the rough. Again -- up to them. I wouldn't make a "buy/don't buy" recommendation to them. Just nonchalantly point out issues that you are concerned about, with reasonable estimates, and let THEM decide whether or not that's the house for them. And then let them figure it out from there. They are adults with kids. Let 'em be adults.

Although, it would be a kindness if you could find something nice to say about the house -- nice size rooms, great view, etc.
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Old 03-04-2018, 06:47 PM
 
Location: Wilmington NC
6,054 posts, read 5,858,335 times
Reputation: 15333
OP, are you going to end up subsidizing this fiasco? Because that is what it looks like to me. Those young people don't need a house that size, or a responsibility that daunting. I don't blame you for wanting them to be more cautious.
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Old 03-04-2018, 08:31 PM
 
5,040 posts, read 3,644,154 times
Reputation: 7132
My current home was a foreclosure purchase and honestly I would run away from the house posted in the OP. The unpaved driveway and the wooden walkway/front steps make me suspicious that shortcuts were taken when this house was built. It just looks like a house that will present many problems over the years.
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Old 03-04-2018, 08:53 PM
 
Location: Rochester, WA
8,355 posts, read 5,005,464 times
Reputation: 22044
Unpaved driveway and wooden landscape timbers are a deal breaker? Really? Fascinating.

Very few of the places I visit in the country have paved driveways.

Perspective is everything!
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