Projects/Home Improvement Thread

[wizards8507]

You think that in 2-3 years that your mortgage payments will pay down enough principle to make up equity difference? Have you actually looked at an amortization schedule for this loan?

Wooly's right. If I were you I'd be chucking every spare dime I came across at this house until you get to 20% equity. Minimum monthly payments aren't going to get you there any time soon.

 

[koonja]

He should refi the FHA as soon as he gets to 20% equity anyways. Fairly new FHA regulations say that you have to carry PMI for the life of the loan, which really makes it a shit product if you can otherwise qualify for a conventional.

#Truth

 

[koonja]

Wooly's right. If I were you I'd be chucking every spare dime I came across at this house until you get to 20% equity. Minimum monthly payments aren't going to get you there any time soon.

And it'll be easy to do since I will not be putting a dollar of my own towards the mortgage .

 

[wizards8507]

And it'll be easy to do since I will not be putting a dollar of my own towards the mortgage .

FWIW, I banged out a quick amort schedule and if you started with zero down on a thirty year loan it would take you over nine years to get to 20%.

 

[koonja]

FWIW, I banged out a quick amort schedule and if you started with zero down on a thirty year loan it would take you over nine years to get to 20%.

I have 48K in student loans, so I'm tackling those first since the interest rate is ~ 5%. I will lilkely pay ahead on the mortgage too, but the loans are in my first priority. I'm in deferrment currently because I'm in the middle of my MBA, but cranking out $895 per month towards them. I ball hard on debt.

 

[wizards8507]

I have 48K in student loans, so I'm tackling those first since the interest rate is ~ 5%. I will lilkely pay ahead on the mortgage too, but the loans are in my first priority. I'm in deferrment currently because I'm in the middle of my MBA, but cranking out $895 per month towards them. I ball hard on debt.

Holy hell brother. Your student loans are more than my mortgage.

 

[koonja]

Holy hell brother. Your student loans are more than my mortgage.

I come from a very poor family. I was never given more than $100 a semester, and that was to pay my registration, lol.

I'm in defferment, so don't have to pay anything. If I was on the 'normal' schedule for that amount and not in deferrment, I'd pay $400 a month. I pay the extra because I choose to.

 

[wizards8507]

If I was on the 'normal' schedule for that amount and not in deferrment, I'd pay $400 a month. I pay the extra because I choose to.

Gotcha. I thought you were saying that $895 was your MMP.

 

[woolybug25]

He should refi the FHA as soon as he gets to 20% equity anyways. Fairly new FHA regulations say that you have to carry PMI for the life of the loan, which really makes it a shit product if you can otherwise qualify for a conventional.

Unless of course interest rates rise over your current FHA rate, in which case, you just cancel the PMI once your LTV is better than 80%.

FHA isn't a shit product, it's a misunderstood and misused one, but not a shit one.

 

[koonja]

Unless of course interest rates rise over your current FHA rate, in which case, you just cancel the PMI once your LTV is better than 80%.

FHA isn't a shit product, it's a misunderstood and misused one, but not a shit one.

Yeah, I didn't have an option. The house I bought was more than I thought I could afford, so FHA was my only option. If I did conventional, the amount I was allotted came down ~$50K.

 

[woolybug25]

I ball hard on debt.

Sound investment strategies, brought to you by Koon...

 

[wizards8507]

Unless of course interest rates rise over your current FHA rate, in which case, you just cancel the PMI once your LTV is better than 80%.

You can't do that anymore, not since 2013. PMI on an FHA loan is permanent. As in, refinance or you're paying it for 30 years regardless of LTV.

 

[koonja]

You can't do that anymore, not since 2013. PMI on an FHA loan is permanent.

Yes, you cannot cancel after 20% like conventional. I will have to switch to conventional at that point in order to escape the PMI.

I knew nothing about home mortages until about 3 months ago. You guys seem to know your ish.

 

[woolybug25]

You can't do that anymore, not since 2013. PMI on an FHA loan is permanent. As in, refinance or you're paying it for 30 years regardless of LTV.

I didn't realize that because people are still removing them at my bank (I don't do residential), but those folks are grandfathered in.

Still not a shit product though. I don't have any need for it, but that doesn't mean that in a rising interest rate market, it can't benefit someone to stay in one.

 

[wizards8507]

FWIW

 

[woolybug25]

FWIW

Good graph, but I think it's fair to say that a great deal of people that need an FHA loan don't utilize a 15 year term.

Koon, 30 year term?

 

[koonja]

Good graph, but I think it's fair to say that a great deal of people that need an FHA loan don't utilize a 15 year term.

Koon, 30 year term?

30 years, correct. FHA is basically for people who can afford the mortgage on a normal, monthly schedule, but have little to no savings. For scrubs like me.

 

[woolybug25]

30 years, correct. FHA is basically for people who can afford the mortgage on a normal, monthly schedule, but have little to no savings. For scrubs like me.

So looking at Wiz's graph, you can see that your equity position won't change very quickly at all. Under a 15 year term, a significantly larger portion of your payment is going to principle each month.

They have to provide you an amortization schedule at closing, but you can run a quick and dirty one by googling a mortgage amortization table template. It's good math to know if you plan on making additional real estate moves in the near future.

 

[Irish#1]

I come from a very poor family. I was never given more than $100 a semester, and that was to pay my registration, lol.

I'm in defferment, so don't have to pay anything. If I was on the 'normal' schedule for that amount and not in deferrment, I'd pay $400 a month. I pay the extra because I choose to.

You do realize that deferment doesn't stop interest from accruing don't you? That's where Sallie Mae and the others make their money. They'll gladly put you in deferment. Means more money for them.

 

[koonja]

So looking at Wiz's graph, you can see that your equity position won't change very quickly at all. Under a 15 year term, a significantly larger portion of your payment is going to principle each month.

They have to provide you an amortization schedule at closing, but you can run a quick and dirty one by googling a mortgage amortization table template. It's good math to know if you plan on making additional real estate moves in the near future.

Everything you said is smart and true, however, I'm a consultant for a health care company, and real estate isn't something I want to go far into. I don't plan on ever own more than this house and a forever house (granted, life happens). So I don't want to expand into any other rental properties. It would take away from my IE time and I would never let opportunity get in the way of that .

As is, I'm comfortable with the amortization schedule until I hit 20%. Before I hit 20%, I'll be student debt free and have a lot more disposable income, which I can then use to tackle the mortgage and switch to a conventional on it.

 

[Irish#1]

So looking at Wiz's graph, you can see that your equity position won't change very quickly at all. Under a 15 year term, a significantly larger portion of your payment is going to principle each month.

They have to provide you an amortization schedule at closing, but you can run a quick and dirty one by googling a mortgage amortization table template. It's good math to know if you plan on making additional real estate moves in the near future.

Having had my share of mortgages and just recently helping one of our kids buy a HUD home, I can tell you that Wooly is spot on with his sound advice.

 

[koonja]

You do realize that deferment doesn't stop interest from accruing don't you? That's where Sallie Mae and the others make their money. They'll gladly put you in deferment. Means more money for them.

For the subsidized, correct. My loans are about half and half. I pay through, though. Which is why I am stuck with you IE freebies and cannot afford a premier site

 

[wizards8507]

Having had my share of mortgages and just recently helping one of our kids buy a HUD home, I can tell you that Wooly is spot on with his sound advice.

Sounder advice would be "don't buy a house in which you're dependent on a tenant until you're otherwise debt free and have enough for a healthy down payment." But we weren't consulted on the purchase.

 

[koonja]

Sounder advice would be "don't buy a house in which you're dependent on a tenant until you're otherwise debt free and have enough for a healthy down payment." But we weren't consulted on the purchase.

If I was dependent on a tenant, they wouldn't have given me a loan. The bank has no idea I'm renting out rooms. I could afford it on my own, but it wouldn't be fun.

Would you advise me to wait 5 years until my student loans are paid off? No thanks. Meek Mill told me scared money don't make no money so YOLO. I got this, guys. I have a good job and am a hard worker .

 

[ozzman]

I have some land in Florida to sell you, koon...

 

[koonja]

I have some land in Florida to sell you, koon...

Sold.

 

[wizards8507]

If I was dependent on a tenant, they wouldn't have given me a loan. The bank has no idea I'm renting out rooms. I could afford it on my own, but it wouldn't be fun.

Would you advise me to wait 5 years until my student loans are paid off? No thanks. Meek Mill told me scared money don't make no money so YOLO. I got this, guys. I have a good job and am a hard worker .

Yeah but it's way more fun to give you shit.

Sent from my Samsung Galaxy Note 4 using Tapatalk.

 

[koonja]

Had to replace an old, original door leading from the kitchen to the basement yesterday. Took all of the original wood framing out and have the new door and frame in there, just have to get some shimmies and screw everything together. Did it all by my lonesome.

The window guy is coming tonight to give me an estimate on replacing 10 original windows. Old, wooden frame, single hung windows. I think the framing being original will add to the cost, but any idea what I should feel comfortable with as an estimate? I'm loosely estimating it being a $4,000 job. 10 windows at $200 a pop, and $200 labor per window.

 

[IrishLion]

If you aren't willing to replace the windows yourself you can just get the hell out.

 

[koonja]

If you aren't willing to replace the windows yourself you can just get the hell out.

One of my best friends is 32, retired and has flipped and owns 20 houses and apartment complexes and he says he won't touch windows by himself. So I'm definitely having them professionally installed.