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Originally Posted by Cynthetiq
I'm not trying to sway you from buying a home. thingstodo is right, look for a less expensive home. Look for the same things that are in the more expensive ones, since they tend to attract better buyers. Examples of this are 2 bedrooms versus 1, 3 vs. 2, garage versus covered parking.
I'm not sure where you are in the US, I assume AK by your profile, but are there any properties that you can purchase in your area that are in the $75,000 range? It may be a 1 bedroom condo/townhouse, it gives you ample 20% and move in money.
here are a couple thoughts about the 20k you have for savings...
Think of the 20k you are putting into the house for savings.. it is for longer term savings than "rainy day" but more like 10-30 years down the road. Yes, you'll start your rainy day fund over again, but if there was a "rainy day" that required your attention, you could have other new options like home equity line of credit (HELOC). The caution is to not over borrow for frivilous "rainy day" things, like new TVs, cars, and other depreciating assets. HELOCs are best setup mainly for improving the house in some manner, like new roof, carpeting, new kitchen, bathroom improvements, etc.
The more you pay upfront the less you pay in the backend. If you look at mortgage calculators and calculate the total payments over 30 years, you'll see that you've paid almost twice the amount of that you borrowed to originally purchase the house.
If you were to move in with your sister, you state "small place," does that mean you'll be sleeping on the sofa? have your own room?
If you were to scrimp and save all that you could, how much would you be able to save in 1 year? this should give you an idea and goal as to what the timeframe you'd realistically be living with your sister.
just because the amount you're able to borrow goes up doesn't mean that it's a better deal for you. it means you're qualified to buy more house, but also means you're on the hook for more in monthly payments especially if you choose to not put 20% down.
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well where I live the houses are so expensive for what they are. I live in Anchorage Alaska. anypart of town in anchorage is fine.
www.alaskarealestate.com ( look here and browse for my town, and you will see what I am talking about.
I am looking for a home that has like 2 bedrooms, and about 1000sqft. I am not picky. it doesnt need to have a garage or car port. i dont mind old heating instead of forced air. i just want something I can build on to if i want, and to be able to have some people over. also have something that I dont hear the neighbors snore. Not like those houses /apartments that you cant have more than like 3 ppl over and feel too crowded.
I can get a cheaper home but we would be talking about mobile homes. (which I do not want.) since they are pushing to remove all mobile homes from my town. also the neiborhood is not what I am looking for.
more like those old ranch style homes that have a basement type. nothing new.
So as for getting rid of my $20k, if I dump it into my home, if somethign comes up to pay for, I can use my home or HELOC to cover that? what is the penalty? what are the pros and cons in laymans terms?
When I say small place with my sister. is that she lives in a small 2 room mobile home, and she has a daughter and I dont want to be a bother with me sleeping on the couch. I know she wouldnt mind but I dont feel like i should.
well my bills are about 900 bux a month with no living bills, though I would help my sister out, and then i make about 3000k a month. may seem like alot, but I think i would need to cut back on spending. lol
I do understand about the whole. "hey the will loan me more money" statement. by saying that though is that they see that I could pay that amount but i wouldnt even be close to match that if I could help it. my mind doesnt work like that.
also is it true that if i was to pay once a year double my mortgage I can take off 7years? if that were true. I would do this once a year every year, since we get the state Permanent Fund Dividend, and i save that every year anyways.