New House

[nub]

So I just purchased a home but it will not close for another two months.

It was on the market for 310 days originally listed at $369,000. They then lowered their price about 4 months ago to $300,000. I have been looking for a house since September 08 or so. Since I am in the Real Estate business I knew it was a good time to buy.

I originally had a signed contract for a short sale on a house for $215,900, it was a townhouse. The owner's had purchased the property for $379,000 in 2007 and were going in default. I had a great deal, and the owners agreed. However it was a shortsale and those things take forever, so I decided to keep checking. I let that one slip through since it was a townhome (meaning 2 stories). If I waited out I would have gotten it but I found something better (see first paragraph).

(do not purchase a short sale it is a FUCKING HEAD ACHE).

Anyway, on the house I finally settled on, I got the price down to $250,000. I am putting down 10%+closing costs. I also get back 3% commission as I am in the business, so that is $7,500 to me.

Here are some cool things that happened (besides the commission). Interest rates are at ALL TIME LOWS, I am talking mid to high 4's, but are expecting to go even lower (by the time I finally close). Also, because I am a first time home buyer, a bill just passed today (as part of the stimulus package) that a first time home buyer will receive a $15,000 tax credit, saving me another $3,000-$4,000.

Anyway, this is pretty exciting, it is a single family detached home in Boca Raton, Florida. It is about 1,920 square feet of living area with a 2-car garage. (the property assessory still has this damn thing assessed for $400,000) However, luckily, my sale will bring the assessments down as my purchase was not a distressed sale.

This market is crazy, especially South Florida as prices have dropped from their peaks in 2005/2006 about 40%-50% which is HUGE.

But uhmm... any tips on for first time home buyers? Any tips on squeezing money besides cancelling my GS accounts. It is going to suck because I will have so many additional expenses so I won't be able to save as much as I used to. Oh well.

gg

[TheLastShamurai]

unfortunately, most the things that save you money in the long run (as far as houses go) require up front capitol :(.

[diethx]

Congrats on the new house. I've never owned so I have no advice, but very cool.

[MotleyCrew]

Buy these:

http://farm1.static.flickr.com/175/370389611_a973e0fa0a.jpg

[phantasm]

To save some cash. Eat a diet consisting entirely of this.

http://4.bp.blogspot.com/_ANQ9-osvn34/RuLrm7FA3nI/AAAAAAAACDg/oJWVNq4ifwY/s400/beans_and_rice.jpg

[TheLastShamurai]

Buy these:

http://farm1.static.flickr.com/175/370389611_a973e0fa0a.jpg

yeah thats pretty much what i was thinking. easiest way to save money is in energy effeciency, which requires up front capitol (a lot depending on how far you take it). you should check out the energy star website, they have a lot of good info on there. if you have the money the biggest thing in my opinion is replacing electric water heaters with gas, replacing windows with well rated one (energystar website will tell you which ones are good for you), and sealing/insulating you house and duct work properly.

[TheLastShamurai]

To save some cash. Eat a diet consisting entirely of this.

http://4.bp.blogspot.com/_ANQ9-osvn34/RuLrm7FA3nI/AAAAAAAACDg/oJWVNq4ifwY/s400/beans_and_rice.jpg

holy shit! thats my diet right now!

yay unemployment!

[Ratolin180]

So I just purchased a home but it will not close for another two months.

It was on the market for 310 days originally listed at $369,000. They then lowered their price about 4 months ago to $300,000. I have been looking for a house since September 08 or so. Since I am in the Real Estate business I knew it was a good time to buy.

I originally had a signed contract for a short sale on a house for $215,900, it was a townhouse. The owner's had purchased the property for $379,000 in 2007 and were going in default. I had a great deal, and the owners agreed. However it was a shortsale and those things take forever, so I decided to keep checking. I let that one slip through since it was a townhome (meaning 2 stories). If I waited out I would have gotten it but I found something better (see first paragraph).

(do not purchase a short sale it is a FUCKING HEAD ACHE).

Anyway, on the house I finally settled on, I got the price down to $250,000. I am putting down 10%+closing costs. I also get back 3% commission as I am in the business, so that is $7,500 to me.

Here are some cool things that happened (besides the commission). Interest rates are at ALL TIME LOWS, I am talking mid to high 4's, but are expecting to go even lower (by the time I finally close). Also, because I am a first time home buyer, a bill just passed today (as part of the stimulus package) that a first time home buyer will receive a $15,000 tax credit, saving me another $3,000-$4,000.

Anyway, this is pretty exciting, it is a single family detached home in Boca Raton, Florida. It is about 1,920 square feet of living area with a 2-car garage. (the property assessory still has this damn thing assessed for $400,000) However, luckily, my sale will bring the assessments down as my purchase was not a distressed sale.

This market is crazy, especially South Florida as prices have dropped from their peaks in 2005/2006 about 40%-50% which is HUGE.

But uhmm... any tips on for first time home buyers? Any tips on squeezing money besides cancelling my GS accounts. It is going to suck because I will have so many additional expenses so I won't be able to save as much as I used to. Oh well.

gg

Congratulations on the house man, thats awesome!

An easy way to figure out what you can shave off as far as squeezing money is to do an average amount of what you spend a month (utilities, any other bills, recreation, etc) with a detailed listing. Decide what you NEED as in actual necessity and what you can live without. But never ever sacrifice your happiness to try to save money because you will be miserable.

Budgeting is the best way to keep track of your finances, I know its hard to keep up with doing a budget every couple months but beleive me, it helps SOOO much.

[Bobmuhthol]

First piece of advice: buy a home that you can already afford.

[Wesley]

Congratulations. You seem to have gotten a really good deal. Like these guys said, energy efficiency, and fooding efficiency. Between the two you'll save a bundle.

Also, it is absolutely imperative in a state like Florida that you do not neglect your dinosaur insurance.

Dinosaur attacks account for 40% of all property damage within the first 10 years of owning a home. If you neglect to purchase the proper dinosaur coverage, you will be sorry when a flock of Gallamimuses come stampeding through your living room. These are not animals to be taken lightly. They will eat all of your food, and also poop on your carpet. Additionally, they have a habit of attracting Tyrannosaurs.

Just my two cents.

Also, here is a picture of a dinosaur for you. He has a guitar. Most dinosaurs prefer acoustic guitar to electric guitar because they are old fashioned.

http://www.clipartof.com/images/clipart/xsmall2/13900_big_green_musical_dinosaur_singing_and_strum ming_a_guitar.jpg

[LMingrone]

Congrats on the house. I think now is the time to buy. My parents just went through a divorce, and two houses that were appraised at $650k and $329k a few years ago are now on the market for $300-400k and $129k. I'm honestly thinking about voiding my current lease and buying the second one for 129. It's a three family home, so I'd make out even pretty much. It's hard to make any big moves in these times though.

[The Ponzzz]

Yeah. I could have told you on the fast closing stuff. Trying to do a 10 day close is a nightmare and should not ever be done unless the home is freshly built or you know the ins and outs of the property.

You said you have about 2 months to close, so I'll give you some advice to keep up on during the time you have. Make sure you have a thorough home inspection. The cost depends on square footage, but should be about $300. Include a pest inspection as well (termites, rats, ants, squirrels, etc). Get a survey down of the land for your record. Neighbors are dicks. Plain and simple. If it isn't required to have a lawyer present at the day of closing, get one. I see you're putting 10% down, I would suggest 20%. With 10%, you don't get anything for it. You need to hit 20% to remove PMI (Private Mortgage Insurance). It is a bullshit tack on to your montly mortgage that you get no return on. It is normally about $50-$100 a month until you have 20% paid (Which is about 3-5 years away, but it includes your intial down payment).

As for budgeting, a home should never be more than three times more than your combined household income. Studies say that if youmake less than that figure, you're doomed to live paycheck to paycheck. I see you live in Fl, but make sure to properly winterize your home, meaning making sure your windows and insulation are good and proper so you're not losing any heat (same I guess could be said for central air). Invest in home security, it will save you on your home owner's insurance. Use energy efficient appliances. If you got the scratch, get an HE washer/dryer (LG, Maytag, etc), a new hot water tank with high efficiency and get your furnace/central air unit to 96% efficiency, they save us $100 every month between water, gas and electic.

I think I covered a good deal for you!

[LMingrone]

Just to add to what Ponzzz said..Find a good inspector. My father is a home inspector. Very often, if there aren't many bidders on the home an inspector can save you tens of thousand of dollars. The seller of the home and the bank will usually try to provide you with their own inspector. Get your own, it's worth the few hundred bucks.

[radamanthys]

That this thread has nothing to do with the Hugh Laurie Medical drama is very sad.

[Celephais]

Congratulations. You seem to have gotten a really good deal. Like these guys said, energy efficiency, and fooding efficiency. Between the two you'll save a bundle.

Also, it is absolutely imperative in a state like Florida that you do not neglect your dinosaur insurance.

Dinosaur attacks account for 40% of all property damage within the first 10 years of owning a home. If you neglect to purchase the proper dinosaur coverage, you will be sorry when a flock of Gallamimuses come stampeding through your living room. These are not animals to be taken lightly. They will eat all of your food, and also poop on your carpet. Additionally, they have a habit of attracting Tyrannosaurs.

Just my two cents.

Also, here is a picture of a dinosaur for you. He has a guitar. Most dinosaurs prefer acoustic guitar to electric guitar because they are old fashioned.

http://www.clipartof.com/images/clipart/xsmall2/13900_big_green_musical_dinosaur_singing_and_strum ming_a_guitar.jpg
You are my hero.

[Euler]

I just bought a my first house this year too. Just be prepared that things are going to break. Our water heater exploded 23 hours after close. I was on the phone with the Home owners insurance and they didn't want to pay for it. (suprise) Eventually they paid for a new water heater, but not the stand it goes on because it isn't mechanicle.....mechanical...of or pertaining to machines. I argued that since it was resisting the force of gravity, it was in a sense, doing work and therefore a machine. I was met by stoney silence. Then we got tree roots in the sewer line. Now I wipe with copper sulfate. Still, when you get your first tax return, it will be well worth it. Deducting interest is sweetness distilled.

[nub]

Yeah. I could have told you on the fast closing stuff. Trying to do a 10 day close is a nightmare and should not ever be done unless the home is freshly built or you know the ins and outs of the property.

You said you have about 2 months to close, so I'll give you some advice to keep up on during the time you have. Make sure you have a thorough home inspection. The cost depends on square footage, but should be about $300. Include a pest inspection as well (termites, rats, ants, squirrels, etc). Get a survey down of the land for your record. Neighbors are dicks. Plain and simple. If it isn't required to have a lawyer present at the day of closing, get one. I see you're putting 10% down, I would suggest 20%. With 10%, you don't get anything for it. You need to hit 20% to remove PMI (Private Mortgage Insurance). It is a bullshit tack on to your montly mortgage that you get no return on. It is normally about $50-$100 a month until you have 20% paid (Which is about 3-5 years away, but it includes your intial down payment).

As for budgeting, a home should never be more than three times more than your combined household income. Studies say that if youmake less than that figure, you're doomed to live paycheck to paycheck. I see you live in Fl, but make sure to properly winterize your home, meaning making sure your windows and insulation are good and proper so you're not losing any heat (same I guess could be said for central air). Invest in home security, it will save you on your home owner's insurance. Use energy efficient appliances. If you got the scratch, get an HE washer/dryer (LG, Maytag, etc), a new hot water tank with high efficiency and get your furnace/central air unit to 96% efficiency, they save us $100 every month between water, gas and electic.

I think I covered a good deal for you!

The fast closing thing might be a littledifferent than what you think it is. It is called a "short sale" meaning instead of going through the process of foreclosure they agree on a hugely discounted price and sell it (at market). The bank "forgives" them of the debt and it is recorded to the owner as income.

As for PMI, I already weighed my pros and cons for that. I cannot afford 20% right now, as I did before august, but the market hit me when I took my cash out. However, I can afford the PMI which will be about $75. I can also afford my mortgage payment+HOA+taxes+insurance+utilitiesandservices, Trust me, I ran all my numbers.

Also, it will most likely appraise for showing that I have 20% equity into the house before I pay off the PMI.

I set up an inspector that an officemate referred me to for next Tuesday. I have a provision in contract that states that the seller has to pay up to 1.5% of anything that needs replacing or repairing (fixtures/house itself/washer dryer)

Anywho, thanks for the advice, and to others, I already obtained my dinosaur insurance as well.

[Skeeter]

The value of my home dropped by 40k. I now owe more than it is worth. We built in 2004. It's possible I may have to live here the rest of my life. :cry:

[Allereli]

put the house on a truck and move it to a place that doesn't get hit by hurricanes

[Skeeter]

We got hit by a hurricane in September. I live in Southern Ohio.

[Allereli]

We got hit by a hurricane in September. I live in Southern Ohio.

I'm betting your house wasn't boarded up and you weren't hiding in a closet. My mother lives in the next town over from Boca and they just finished work from Katrina damage.

[Skeeter]

nope, but getting hit by a hurricane 600+ miles from the ocean is odd to say the least. The tree and roof damage was epic.

[Gan]

The fast closing thing might be a littledifferent than what you think it is. It is called a "short sale" meaning instead of going through the process of foreclosure they agree on a hugely discounted price and sell it (at market). The bank "forgives" them of the debt and it is recorded to the owner as income.

As for PMI, I already weighed my pros and cons for that. I cannot afford 20% right now, as I did before august, but the market hit me when I took my cash out. However, I can afford the PMI which will be about $75. I can also afford my mortgage payment+HOA+taxes+insurance+utilitiesandservices, Trust me, I ran all my numbers.

Also, it will most likely appraise for showing that I have 20% equity into the house before I pay off the PMI.

I set up an inspector that an officemate referred me to for next Tuesday. I have a provision in contract that states that the seller has to pay up to 1.5% of anything that needs replacing or repairing (fixtures/house itself/washer dryer)

Anywho, thanks for the advice, and to others, I already obtained my dinosaur insurance as well.

Agreed on the shortsale, I have 3 files on my desk now that are shortsales and we've been working on them since December. If someone is being foreclosed upon, the delinquent mortgage is usually the tip of the iceberg with regards to delinquent debt tied to the house/owner. :(

After reading your OP and this, it sounds like you've got everything thought out. The only thing I did not see mentioned is the HOA addendum. I see buyers get tagged with unreal HOA fees (resale cert and transfer fees) from the HOA management companies or the HOA themselves. Hopefully you have a provision in your contract that caps the expense of transfer fees from the HOA.

[nub]

After reading your OP and this, it sounds like you've got everything thought out. The only thing I did not see mentioned is the HOA addendum. I see buyers get tagged with unreal HOA fees (resale cert and transfer fees) from the HOA management companies or the HOA themselves. Hopefully you have a provision in your contract that caps the expense of transfer fees from the HOA.

Yeah we do have an addendum for that. The HOA fees will be $330 per month (bah) but any special assessments coming up in the next year or any delinquent fees that have not been paid would also come off of the sale price if they had not been paid.

Fortunately the HOA fees pay for lawn service, maintenance, (some type of intervol where they paint your house) pressure wash your driveway/roof etc. However, I think the main expense is for a damn gate guard which I could care less for. I think the resell will be better with a gated community but I personally would rather not have a gated community.



And Allereli, which town next to Boca does your mother live?

[Clove]

As for PMI, I already weighed my pros and cons for that. I cannot afford 20% right now, as I did before august, but the market hit me when I took my cash out. However, I can afford the PMI which will be about $75. I can also afford my mortgage payment+HOA+taxes+insurance+utilitiesandservices, Trust me, I ran all my numbers.

Also, it will most likely appraise for showing that I have 20% equity into the house before I pay off the PMI.I haven't paid close enough attention to the flurry of tax incentives to buyers that are going on so this may have changed but homeowners who bought their house after January, 2007 could deduct PMI payments with their mortgage interest. If this is still the case, it's more tax-savings for you.