I think I'm about to be a home owner!!

[guitarsjb]

Funding, Inspection, and Appraisal done..just waiting on title work. Looking good here!!!

Please feel free to fill me in if there is more to go through that I don't know about lol

[straycat]

Congrats Jeri just you and the mortgage Co now.
Make the payments on time or early if you can.If at all possible pay one xtra payment a year that will cut a 30 year down to 19 years.
The last one I did on a 15 year note wish I had done that on my first two houses.

[xenophobe]

Oh, wow. That is big news!

I'd agree with straycat... try to get your payments as low as possible so you can double up as much as you can. A typical mortgage payment is what, 70-80% interest? Any extra you can pay will go directly to the balance. The mortgage payment on my parents house was $719. If I remember correctly, $540 of that $719 was paying off just the interest.

And GRATS!

[emperor_black]

Congrats!! Been a home owner for 4 years now. You can play as loud as you want as long as you keep the windows closed.

And oh, home owner means, now the home owns you! LOL

[thebigz]

Congrats! I'm just selling my house now. I've learned that buying/selling homes is a big pain, but it is awesome to be able to do what you want when you want

[Cygnus X1]

Congrats and HNHD!
+1 on paying off early.
Home equity helps out when things start breaking!

[straycat]

I started buying houses by accident when I was 26 LOL
Bought one and the builder let me pick all my options such as brick, carpet, roof color and appliances.
Really a great guy to work with.He was an older guy that had owned the apt complex I was living in and I fixed all of his washers and dryers when they broke down so he gave me a break on my first house.
He came by one day and said the neighbor next door was moving and selling his house.He said I should buy it and rent it out.
I said Don I'll be lucky to afford the one I bought LOL.
He said I'll work with you I'll buy it back and sell it to you.I took him up on it and bought it.Ended up buying two more just down the street a year or so later.
At 29 I owned 4 houses on the same street.
A real estate tycoon by accident LOL.
Really happy for you Jeri that is awesome!

[metal4you]

Go for a 15 year mortgage. It will cost you more but at the end it will save you a lot $$$.
When I bought my home I thought can play as loud as I want but I forgot. I am married. lol

[VitaminG]

congrats, Jeri. Great news

[jdr94]

Congrats man!

[DonP]

I disagree with the 15 year mortgage. What if you run into financial difficulty and can make the larger payment? I say keep the monthly payment low in case of hard times. Make extra / larger payments in good times.

Selling a home is a lot harder than buying - well, I'd call that 50/50 with my experience.

Straycat,

Do you still have those rentals and have they helped you financially? I had a lot of headaches with renters.

[Vass]

Do not do not pay your mortgage early. I understand not wanting debt but a mortgage is the only low rate tax advantaged loan you will ever get. After deductions your rate will be like 3%.

Work a carry trade. It's what banks do. Take the extra payments, invest them. Even if you only make 5% you get a 2% carry. It's investing with the bank's money.

The government has decided home ownership is a public good. As such they in essence subsidize it by giving you huge interest tax deductions. Don't throw that away.

I could pay off my house if I wanted to. Instead I slammed the extra money in my 401(k). Up 15% last year, mortgage cost me about 3%, free money for me.

I'm not suggesting levering yourself to the gills, but if you have any other debt, pay that first, then invest extra cash. Trust me, this is how you get well off without having to have a huge income.

[paulbag]

Congrats...I just bought my first home last summer at the tender young age of 43...looking forward to hearing more advice in this thread...

[Amerturk]

I'd go the 15 year if you can swing it. I refi'd a couple of years ago and went from paying 11k a year in interest to 6k a year in interest....which means a shitload more of your payment is applied to the principal. With the said you have less to write off at the end of the year. I noticed about a 1k less difference in my tax return because of this. I'd rather take the 1k loss on the return vs paying an additional 6k in interest.

My only beef with a 30 year is obviously the time length to pay it back, but also how many people will make an extra payment with a 30 year monkey hanging over their heads?

BTW, my theory of 15 years is only if you plan on staying in your house. If you plan on moving after a few years, weight out the odds of both loan types.

[straycat]

Straycat,

Do you still have those rentals and have they helped you financially? I had a lot of headaches with renters.[/QUOTE]

The rentals did OK only had one shifty renter but I screened them/background checked them and was very choosy who I rented to.
I sold 3 to start a trucking business which worked out pretty good.
Having trucks pretty much paid for starting out helped a lot.Trucking is a tough business and iffy at best anymore.
Renting houses is an OK thing to do but don't mortgage your existing home to buy another just to get into rentals.
There are times when the house will sit empty and cost you money.
Always gauge the rental cost appropriate to the neighborhood and never rent for less than 3% over your mortgage payment for that property.I kept separate accounts for each house so I could track them easier and control costs.
Some investors say to bundle the rental accounts but you can lose track very easily.
People do seem to be renting more these days so it may not be a bad time to get into it.
Dave Ramsey on his web site writes about this subject and he explains it very well.Very smart guy.

Vass makes some good points its always good to add to your 401K when you can and if you are not planning to stay more than 5 years a 30 year note is fine.
I don't encourage leveraging a whole lot but it does work in some cases.
For me the goal is to get out of debt as soon as you can.