I’m considering buying my first home in the near future and have some questions. I realize a lot of answers to financial questions are “it depends” so if you could ballpark it, give a range, or give an example from personal experience, that would be great.
Me + SO would both be on the mortgage. We are both mid-20s, credit scores 750+, combined income approx. $100K. Looking in Fort Worth, TX, area for home <200K.
1) We most likely won’t be able to put a 20% down payment without breaking into our backup funds (which we won’t do). My understanding is we will be required to have PMI until we pay down our principal to 80%. What kind of fee can I expect to pay for PMI? Is it a percentage of the mortgage or flat rate?
2) Given the above, what kind of interest rate would be “good” for us? Obviously there is a wide range of what we might expect. What would be the threshold between “that seems good, let’s think about that” and “holy shit I can’t believe we got one that low, let’s go with that one”? Alternatively, what’s the threshold between “seems high but we’ll consider it” and “too much, don’t give it a second thought”?
3) Our current thoughts are along the lines of renting a house is pretty expensive, might as well be paying a mortgage and building equity in something we own. That said, we also know that the mortgage payment is not the only thing we’d have to worry about if we purchase a home. What kinds of additional expenses might we be overlooking? I’m talking things that we WILL be paying (property taxes, homeowner’s insurance, etc.), not things that MIGHT happen (hot water heater breaks, need to replace the refrigerator, etc.). Note: I’ve been living in rented houses for about 6 years so I’ve accumulated a good amount of “stuff,” so major furniture purchases, stocking the kitchen, and the like are already taken care of.
4) Closing costs – who covers them? Are these things like realtors’ commissions etc?
5) Do monthly mortgage payments get bundled with other expenses (PMI?) or is it all paid separately?
Any advice, pearls of wisdom, horror stories, “wish I woulda” stories, etc. are more than appreciated. Thank you!
FYI: The rent vs. buy calculator on the wiki said if I can rent for less than $1,100/mo then renting is better, if that changes anything! It’s unlikely we would be able to rent in that range.
Submitted March 04, 2016 at 04:50AM by Goalexgo http://ift.tt/21aq4oJ personalfinance
No comments:
Post a Comment