Buying my first house!!!

[Beta Man]

Originally Posted by Teabaggins

make sure you pay more than your minimum mortgage payment every month. take the minimum, add a few hundred and act like that IS your payment.

Making one extra payment per year (Say your mortgage is $2,000 a month + taxes, so pay $4,000 every December for instance) will knock SEVEN years off your mortgage........ so buy less blus

[Teabaggins]

I just pay like $200 extra a month and that number stays as the "minimum" in my head, adds up to about the same

[Blu-Benny]

Originally Posted by Teabaggins

I just pay like $200 extra a month and that number stays as the "minimum" in my head, adds up to about the same

that gets easier after you get into a routine w/your mortgage and the other bills that you have. but yes, every little bit helps.

[Marquoz]

If you haven't signed the paperwork yet, make sure to check a few things. YSP - Yield Spread - This is what the loan originator makes for jacking your interest rate up. ARM - Adjustible Rate Mortage - do NOT get one of these pure and simple, you WILL have to refinance it in two years, another way to milk you for money. Do not fall for a bait and switch at the closing table, make sure that the quote on the rate you got initially is the same as the one at the closing table, do NOT be afraid to walk, they can and will be able to get it lowered within 24 hours and reclose. Ask as many questions as you want at the closing table, do NOT let the lawyer rush you through it saying sign sign sign. You are signing something that is 10-30 years worth of you paying, make SURE you 100% understand EVERY little detail. This can and will screw up your credit if you don't understand it completely. Escrows are a great thing! You pay your taxes and insurance monthly versus having this huge single lump sum every year. Homestead Exemption is also great depending on the city you live in. Where I live, you deduct $75,000 off the value of your house if you file for the exemption come tax time. It is a huge saving.


That said, CONGRATS! It's a great thing owning your first house. As people said, if you are paying enough the tax deduction is awesome!

[Teabaggins]

yeah Escrow is the way to go

[Uniquely]

Originally Posted by Marquoz

If you haven't signed the paperwork yet, make sure to check a few things. YSP - Yield Spread - This is what the loan originator makes for jacking your interest rate up. ARM - Adjustible Rate Mortage - do NOT get one of these pure and simple, you WILL have to refinance it in two years, another way to milk you for money. Do not fall for a bait and switch at the closing table, make sure that the quote on the rate you got initially is the same as the one at the closing table, do NOT be afraid to walk, they can and will be able to get it lowered within 24 hours and reclose. Ask as many questions as you want at the closing table, do NOT let the lawyer rush you through it saying sign sign sign. You are signing something that is 10-30 years worth of you paying, make SURE you 100% understand EVERY little detail. This can and will screw up your credit if you don't understand it completely. Escrows are a great thing! You pay your taxes and insurance monthly versus having this huge single lump sum every year. Homestead Exemption is also great depending on the city you live in. Where I live, you deduct $75,000 off the value of your house if you file for the exemption come tax time. It is a huge saving.


That said, CONGRATS! It's a great thing owning your first house. As people said, if you are paying enough the tax deduction is awesome!

All very good advice. I've had to walk away from a closing before when a mortgage broker pulled a bait and switch on me. It's frustrating and you just want to get it over with..... but don't accept anything other than the terms originally agreed upon.

[icyteddy]

Congrats!! Just dont wake up the neighbors when you are blasting your home theater.

[Monkey]

Awesome, congrats on the purchase!!

[hoju3508]

Congrats!

[My_Two_Cents]

Originally Posted by Teabaggins

yeah Escrow is the way to go

For new homeowners, definitely. On our latest home, I elected to NOT go with an escrow account. A lot of $$ is tied-up in an escrow account, and you aren't earning anything on it. Additionally, the bank wants a ~3-6 months cushion in the account, which only ties up more of your $$. When I set up my auto-debit to pay my mortgage each month, I also added an auto transfer of 1/12 the expense of my taxes and insurance into a seperate savings account. When my taxes & insurance bills came, I simply wrote checks to cover them and then reviewed whether I needed to adjust my monthly transfers for the next year. I don't make much on this account, but I'm also not giving my mortgage company free use of my $$ all year. I would NOT recommend this for everyone. You need to be financially mature enough to NOT think about that money until the bills are due, otherwise you'll be in a world of trouble. My 2 cents.

[quest88]

The government is allowing first time buyers to take advantage off up to a 7500 interest free loan that from my understanding can be paid back threw your income taxes you might want to look into it.
http://www.irs.gov/newsroom/article/...186831,00.html

[Anthony P]

congrats and enjoy

[Teabaggins]

Originally Posted by Ricshoe

For new homeowners, definitely. On our latest home, I elected to NOT go with an escrow account. A lot of $$ is tied-up in an escrow account, and you aren't earning anything on it. Additionally, the bank wants a ~3-6 months cushion in the account, which only ties up more of your $$. When I set up my auto-debit to pay my mortgage each month, I also added an auto transfer of 1/12 the expense of my taxes and insurance into a seperate savings account. When my taxes & insurance bills came, I simply wrote checks to cover them and then reviewed whether I needed to adjust my monthly transfers for the next year. I don't make much on this account, but I'm also not giving my mortgage company free use of my $$ all year. I would NOT recommend this for everyone. You need to be financially mature enough to NOT think about that money until the bills are due, otherwise you'll be in a world of trouble. My 2 cents.

I'm a new homeowner and so is the OP, it keeps it simple for us noobs.

[SellmeyourDVD]

Originally Posted by swingle007

enjoy the freedom of peeing in your backyard by moonlight!

LMAO.... a luxury only a homeowner can enjoy

[Marquoz]

Originally Posted by SellmeyourDVD

LMAO.... a luxury only a homeowner can enjoy

Or a drunk apartment dweller in the middle of the night and a set of bushes...

[phlydude]

Originally Posted by Teabaggins

I'm a new homeowner and so is the OP, it keeps it simple for us noobs.

Basically they were saying that if you can save money and be responsible, escrow account and mortgage company payouts of taxes and insurance premiums may not be the best way to go.

Your escrow account doesn't earn interest and the mortgage company uses the money as they see fit...putting the money in savings yourself, can earn you a little extra money (As long as you are sure to pay the taxes and the home insurance premium).

One other thing, shop around for insurance. Bundling the auto and homeowners could save you on multi-line discounts. Make sure that you are covered for at least "full replacement" value of the structure. Home insurance doesn't work quite like car insurance (pay off the loan and get a new car), it covers for you to fix any damages occured to the structure or in extreme cases, rebuild on the same property.

[Teabaggins]

how can I be responsible and still fulfill my drug/drinking habit?

Alkies, druggies, and blukies(blu ray addicts), go with the escrow

obviously responsibility/thinking ahead is not the strong suit of Americans. let's take it one step at a time

[U4K61]

Originally Posted by Teabaggins

make sure you pay more than your minimum mortgage payment every month. take the minimum, add a few hundred and act like that IS your payment.

+1
That is about the best advice there is. In the beginning of the mortgage, almost all the payment is toward interest. The extra $$$ goes directly towards principle and cuts years off the mortgage.

[Moefiz]

Congratulation on your first home purchase...once you buy there is no going back to renting....

[Ferris]

A HUGE congratulations to the OP! My wife and I purchased our first home about 19 months ago, and are EXTREMELY happy!

You've just gone from one side of the fence (I wish people would stop buying so the home prices will go down) to the other (people need to start buying so these prices will go back up!). That's the only frustration I have.

But, if you plan on staying in that house for at least 5 years, it's a worry you shouldn't have to deal with! GOOD LUCK!