Things to know when buying a house?

[Saleen781]

I hope you're referring to the pre-approval process and not saying that an institution will give her a loan before she finds a house. You can't secure the loan until the financial institution knows what it is that they're going to be financing you for. That's why they do a pre-approval process in order to let you know the maximum dollar amount that they will allow you to borrow based on the credit credentials you provide them with. That is also not by any means a guarantee for them to extend credit to you, it is merely a tool.

They call it C & I (credit & income only)

[SVT Lurch]

Plan on buying a house in four months and never owned one before. Guess I'm on here to get any advise on mistakes that might have happend with your purchase or move, how to go about it, what all you need to make sure is done...etc. I'm totally clueless when it comes to this stuff.

Don't make any large deposits. Don't move money around (even between your own accounts) more than you absolutely need to. Don't go buy a bunch of furniture/clothes/whatever on credit until you have the keys to the house in your hand.

Especially if you use B of A as your lender.

Bazinga!

How long does it take typically for everything to be done (loan, etc...) before you can move in? My lease is up in four months and wondering if i should be looking heavily right now, or can i wait a couple of months? I already know what city i want to move so its just finding something in that area (which there is plenty to choose from.) I'm afraid i will run out of time if i dont start looking now.

It typically takes about 30 days from the time you give the lender the executed contract to closing. Big banks will usually take longer.

Should i apply for the loan first or when i pick the house?

Apply first, make sure you're good to go. Sometimes errorneous information is on your credit and this way it gives you time to fix it so you don't end up with a higher rate because you're in a time crunch.

A lot of banks will over-finance people to the point, that if they fall into hardship, there is almost no option other than foreclosure. Try to get points and buy down the interest rate at closing. Don't fall for anything other than a traditional loan, no fha/va, investor, dsi, arm or equivalent loans.

Remember, your loan officer most likely bonuses or makes commission by signing you. They are not your friend. Don't trust them and do your own research.

I work on the default side of REL, so I don't have too much exp in lending or loan closing. But this is what I would begin with.

It's hard to "over-finance" people now with as strict as guidelines are. Paying points is typically a 5-6 year payback so unless she is positive she will be in the house that long buying down the rate may not make sense. FHA loans are great for first time buyers, especially those with less than perfect credit. If she uses a good loan officer who properly explains her payment she should never have to modify at these interest rates and therefore your issue with modifying the loan isn't an issue.

All licensed loan officers are on some form of commission thanks to the new Loan Officer Compensation bill. However, it doesn't mean they're out to screw you. Three years ago there were 33,000 loan officers in Texas. Now there are about 10,000. The ones that are left are usually good ones you can trust who have built solid reputations. As has been mentioned, use referrals - just because you've been with your credit union for 15 years doesn't mean they have your best interest at heart. I'm not knocking them, just saying do your research. Compare their rate online to Chase, Wells Fargo, etc. Just make sure you're taking points and fees into account so you compare apples to apples.

If you only have 4 months left then I would be getting a preapproval letter from a lender now(I highly recommend SVT Lurch here on the board) and then get out there and look for properties that suit your needs/wants.

don't go into a home without at LEAST $10-15 in savings. And FHA will work fine for you at this point, just use a reputable lender, talk to SVT Lurch. The lender he works for has a great reputation.....I know....I'm in the business. Good Luck with your search.

Thanks guys!

Why no FHA? It seemed like a great option...especially over an 80/20.

FHA used to be a lot better than conventional because the monthly mortgage insurance premium was lower. Recently those switched and conventional is cheaper. However, the "hits" to the rate for credit scores below 740 often mean that

I hope you're referring to the pre-approval process and not saying that an institution will give her a loan before she finds a house. You can't secure the loan until the financial institution knows what it is that they're going to be financing you for. That's why they do a pre-approval process in order to let you know the maximum dollar amount that they will allow you to borrow based on the credit credentials you provide them with. That is also not by any means a guarantee for them to extend credit to you, it is merely a tool.

Good advice.

Im A small example and this is an approximate number, a 100k priced home will run you about $850.00/$950.00 with insurance and taxes.

Actually with rates where they are you can go up to $120,000 - $130,000 with minimum down and still be around $950/month. Unless she is in Houston in which case with their MUD districts taxes are higher and it's probably more like $110,000.

[Ruffdaddy]

Im assuming you've been renting, whatever has been your average monthly rent is where you want to be in buying your first home. A small example and this is an approximate number, a 100k priced home will run you about $850.00/$950.00 with insurance and taxes. Look at 5yr. old homes in a fairly new hood. Anything older will cost you in the long run, the older the home the more work it will will require and it will be major shit breaking like A/C units, roof shingles, etc. Unless you find an older home that has been completly renovated.

There are a lot of homes northern Frisco that are in the 1700sqft that fall into this price range. Nice schools, nice neighbors and low crime. Good luck Ash, there a few people on this board that can help you along in this process that can be trusted...'H'

Not sure where you saw a 100K 5 year old house in "north frisco" unless you mean a foreclosure. Maybe in a more remote location that's not actually in Frisco...but even Mckinney will be hard to find that house in a good neighborhood. I also think she's in Houston, and from a friend who just bought there...getting close to town will cost slightly more per sqft than this area.

[Ruffdaddy]

FHA used to be a lot better than conventional because the monthly mortgage insurance premium was lower. Recently those switched and conventional is cheaper. However, the "hits" to the rate for credit scores below 740 often mean that

I thought you only paid MIP on loans that didn't have at least 20% equity? SO wouldn't that limit it to loans like FHA and 80/20s?What conventional loans have mortgage insurance?

[SVT Lurch]

I thought you only paid MIP on loans that didn't have at least 20% equity? SO wouldn't that limit it to loans like FHA and 80/20s?What conventional loans have mortgage insurance?

That's true on conventional loans (any time you put down less than 20% you have to have mortgage insurance or a 2nd lien). FHA requires mortgage insurance for at least 5 years regardless of LTV (equity).

[red95gts]

If you are in Houston, be very, very, very careful about which area you buy in. There are a number of areas that are going down the shitter in Houston and you don't want to be stuck with a house that no one will touch in 5 years.

As a general rule, if you are planning on buying inside the Beltway it's probably not a wise move, unless you are looking at a $500K+ home...

[Rick Modena]

Not sure where you saw a 100K 5 year old house in "north frisco" unless you mean a foreclosure. Maybe in a more remote location that's not actually in Frisco.

It's obvious that you have a problem with me, no sweat off my balls, not everyone can get along, but don't ever question me, BOY*. Especially when it comes to giving advise to memberes here. If you read a little closer you will see where I was giving her an approx. on a 100k purchase, and giving her a neighborhood near where she used to live. I also did not know she moved to H-town...

http://www.zillow.com/homedetails/13320-Hursey-Dr-Frisco-TX-75035/83727066_zpid/

[ImayBblack]

Yeah I'm looking in the Humble are which is North East Houston. I'm applying at my CU now. This shit is confusing.

[SVT Lurch]

Yeah I'm looking in the Humble are which is North East Houston. I'm applying at my CU now. This shit is confusing.

Just give honest and accurate information - the loan officer should be able to explain everything, but if you give out bad information it could come back to bite you later. Keep asking questions until it makes sense.

[red95gts]

Yeah I'm looking in the Humble are which is North East Houston. I'm applying at my CU now. This shit is confusing.

I just sold a house in Kingwood in August after owning it for 9 years. Unfortunately, that area isn't what it once was. Humble is quickly turning into a ghetto. The lack of retail anywhere else on 59N means all the undesirables from inside the BW show up at 59/1960. There have been armed robberies at Deerbrook Mall in broad daylight and that type of shit was unheard of when we moved there in 02.

[Ruffdaddy]

It's obvious that you have a problem with me, no sweat off my balls, not everyone can get along, but don't ever question me, BOY*. Especially when it comes to giving advise to memberes here. If you read a little closer you will see where I was giving her an approx. on a 100k purchase, and giving her a neighborhood near where she used to live. I also did not know she moved to H-town...




http://www.zillow.com/homedetails/13...83727066_zpid/

Dude stop trying to turn everything into drama...It was a simple question.

Thats an HUD owned home btw BOY*. And 14K is no trivial amount.

EDIT: and so you know why I mention foreclosures or similar properties...it's because she only has 4 months. Think a little about her situation instead of focusing on shit talking people in every post you make.

[LS1Goat]

Finding a hard nosed experienced Realtor is the key. It can mean the difference between paying or not paying closing cost in a lot of cases, especially for first time buyers. And much more in regards to them footing the bill for repairs/retrofitting, etc.. And you'll love that first time home buyer tax credit. We have always used TurboTax and we were thoroughly impressed. Feels weird to affirm something positive about the Federal Govt., but it works out well in that scenario.

[Ruffdaddy]

Finding a hard nosed experienced Realtor is the key. It can mean the difference between paying or not paying closing cost in a lot of cases, especially for first time buyers. And much more in regards to them footing the bill for repairs/retrofitting, etc.. And you'll love that first time home buyer tax credit. We have always used TurboTax and we where thoroughly impressed. Feels weird to affirm something positive about the Federal Govt., but it works out well in that scenario.

Agreed on realtor...though I believe they stopped the tax credit some time ago.

[krazy kris]

get a good inspection before buying the house

[IHaveAMustang]

If you only have 4 months left then I would be getting a preapproval letter from a lender now(I highly recommend SVT Lurch here on the board) and then get out there and look for properties that suit your needs/wants. You never know how long it will take before you find what you're looking for, settle on a price with the seller, and get all the inspections done, let alone allow ample time for all the other necessary evils it takes to even get the loan paperwork processing. Then you have to deal with the title/abstract company that prepares all the documentation which can be somewhat of a lengthy process depending on the company. I'd rather have it all done and finished a little too early than too late.

Good grief you have no idea. Don't get in a rush, Lender's certainly don't.