In this video we talk about how much money is needed for a downpayment on a mortgage. Do you need 20% or 10% or are there other options? Watch the video for real answers of how to pay the least amount upfront and still keep your monthly payments manageable.
Here we talk about the MLS and how it works, how you can get the most from it, and why online sites like Zillow and Trulia aren’t the best places to find what you are looking for.
Zach and I bought our first house during the big housing crash of 08′. During 08′ a lot of people were not buying homes in fear of housing prices continuing to plummet and with major lack of trust in the housing industry. Because we came out of college at one of the worst economic downturns our country has ever seen, when we bought our first house, and subsequent houses, we had this question in mind “Could we live here forever?”
History has shown time and time again that after a housing crash, with enough time, the housing market will recover. This gave us confidence that buying would be ok. But of course, like others, we were concerned that we hadn’t seen the worst of it. So, each time we purchased a house, even though we weren’t planning on any of these houses being our “forever home” we wanted to make sure that if Zach lost his job or the market worsened, we would be able to stay in the house as long as needed.
When you are a part of a gift exchange at work, or with your extended family, and there is a max budget for the amount to be spent on the gift, what happens? Most people feel like the max budget is how much they have to spend. If the budget is $30, most likely everyone spent the full $30. Even if that budget is simply to make sure people don’t over spend, it somehow becomes the minimum budget for most people.
This is what can happen when you get pre-approved for a home loan. You fill out your application, give all the information and documents needed to get pre-approved and you are told the maximum amount you can borrow for your home purchase. I can tell you from first hand experience that a lot of the time, this amount becomes the homebuyer’s budget. But, when getting pre-approved, does the bank take into account how much you want to save towards retirement or how much you need to save to go on the awesome trip you’ve been planning to Brazil? Nope, they only look at your debt to income ratio, and your credit score (of course there’s more to it, but these are the big ones).
After watching season after season, and loving, HGTV’s Fixer Upper I couldn’t help but be critical of the fact that the buyers budgets were just not realistic for the average American. Of course, it’s a show, and I shouldn’t expect full transparency. But after having multiple buyers ask me if they can just “take out an extra loan for repairs on a fixer” I thought it would be good to set the record straight. In this video I go over the most commonly used methods of financing the repairs on a house as well as share a realistic approach that anyone can do, even you!
When purchasing your first home, or even subsequent homes, it’s tempting to buy the nicest, biggest house your budget can afford. A house you can grow into and raise your kids in for years to come. However, if you want to invest in real estate, the most affordable way to do that is buying a home as a primary residence (more on this in a later post). So when you purchase a home, making sure the home fits your current needs, along with the needs of the near future (1-2 years) is important, but being cautious of A. Your spending B. rentability and C. being motivated to move into another house sooner than later, is important.