Not including a down payment, how much did you save up before you bought a house? Just curious :)
I think geography may play a factor into this. We always planned to ask for sellers assist but when the house we chose had owners underwater, that idea went out the window.
I had about 25k in the bank, FI 14ish. We had to use 20 of it for downpayment(3.5%) and closing. X amount of the leftovers is earmarked for the wedding.
£50,000 deposit (about $80,000) and a £200,000 mortgage. Such are they joys of living in the UK
(I want to go back to Austria oneday!)
We put down a generous downpayment (35%) but we also managed to save about 40K to start us off on the renovations we wanted to do (mainly monetary gifts from the wedding).
We are saving for a house in Aus & the minimum amount you need for a mortgage is 5% of the purchase price, some banks require at least 10%. In my city houses are expensive, a basic family home anywhere between $410000-$580000. So you need at least $25000 minimum deposit on a $500000 property and you need to show your saving history + pay mortgage insurance + stamp duty (about $20000). If you are a first home buyer the govt gives you $7000 & free stamp duty but only if it is a new home. Different rules apply in different states.
On my first home, I put down 10% and also still had about 5 months of living expenses in savings, plus had a low enough mortgage payment that I had plenty of money left over ever month to rebuild savings/buy some stuff for the house.
I don't regret that decision. 20% would have been ideal but being single that was a long way off and I got a great deal on a foreclosure. It appraised at 20% higher than I bought it for, so I had 30% equity when I closed.
FI and I will be saving for a house once we get married. We would like to put at least 50% down, but that is because we have excellent incomes and will live on his only, and we need to rent for a minimum of 2 years because of move plans. So those factors are a bit unusual and will allow us to save a lot. I'd be fine putting down 20%.
To your original question, we will always have 6 moths expenses in an emergency fund, on top of whatever we spend on a house. I also like to have a car replacement fund (we don't do car loans), and then I would want to have at least several thousand in savings specifically earmarked for new furniture, decor, painting, and house stuff.
We had to bring more than $100k to the closing table (20% down payment and closing costs), so we had that money, plus 6 months of our expenses (our emergency fund), plus $15k for other expenses (moving, buying a generator, replacing the hvac system, etc.). Honestly, this house will need another $150k to bring it up to our standards, but we were not in the mood to wait that much longer before buying a place, so we'll just have to be patient and take on projects as we can afford to pay for them in cash.
@KellyLouise: Is stamp duty the same thing in AUS as property tax in the US (i.e. is it a one time thing or is it yearly)?
Another UK bee living in the South, where proces are even higher...
I had £10,000. FI had £10,000. It had taken me ten years to save that. My father loaned us £20,000 at 4% interest to make up the deposit. We then borrowed £120,000 from the bank, for a very nice terraced house which used to be a factory worker's cottage.
We are hoping to bring 10% of the house cost when we buy in about 18-24 months. In this area its difficult to save past that with the good houses starting at 300k for a town house! We will likely try to get something on land for about 500-600k a little ways out from the city. We are willing to drive and commute together if it means a nice home.
@lovekiss: I dont know how you guys saved like that. This area is rediculously expensive. We're hoping to bring half that to the table. We will likely buy something that needs upgrades etc since we'll buy a foreclosure on land. However we know once we get into a house we'll be able to afford to make those changes since the mortgage will not kill us thanks to VA loan. We make good money but I dont want to spend 3-5 years saving to get a down payment like that.
Wow I am SO glad I live in an area where the average house is only about $100,000 - $150,000.
We are pre-approved for $140,000 but we've set our budget at $80,000. With FHA loan, we'll only need to put $3-4K down, and we will JUST have saved up enough in the next few months for that to happen.
In the suburbs of Pittsburgh, you can get a 2 or 3 story house with 2-4 bedrooms, 1-2 baths, a garage, and a yard in a decent school district with average taxes for anywhere from $50 - $100K.
PHEW!
Oh god yeh I forgot about the £10k worth of stamp duty and legal fees on top, life is fun!
@dewingedpixie: We're in our 30s, so we were both saving long before we ever met. I got my first house a decade ago in a cheap, semi-sketchy area so that I could afford to save for my forever home. And Mr. LK had always rented with roomates so that he could save. So yeah, it took a decade of saving to be able to afford buying in a nice part of this area. But the payoff was a 2200sq ft home (plus full basement) on almost 5 acres of land. Don't get me wrong, Mr. LK has to commute 90-120 minutes each way to his office in DC, depending on whether metro is jacked up or not, and I commute 45 minutes each way to mine in Baltimore, but it's worth it. You simply cannot get the peace and quiet and space that we have here anywhere close to the cities. But yeah, it's sad when half a million buys a fixer upper and it takes 18 months just to find a house that comes in at THAT price tag.
@Stace126: No offense Stace, but what suburb of PGH are you talking about? I live there too and I think you need to add at LEAST another 100k onto that number for all that you described.
@lovekiss: You two are very lucky, and smart about savings.
I'm in mylower 30's but having a child, going to school, and paying off heavy divorce debt on my own without filing for bancrupcy really killed a savings plan.It was important to me to clean up my own debt though on my own grounds I made that mess I had to clean it. The same went for my schooling which I'm about 15 months from completing. I do keep a couple thousand till reccent that was the best I could do even living with my family after the divorce.
FI is in his early 40's he had a foreclosure due to a divorce. He took over all the financial burden from that marraige because thats how he is. He had excellent credit destroyed but is just now fixing that situation on his own. He had a much better paycheck to fix his issues so its been easier for him.
We met 2 years ago and were pretty much both on ground zero financially. We hope to purchase in 18-24 months but in northern VA. We will have about the same commute as you. We've seen several homes in the last year that we liked in the 450-600k price range with 2-10 acres. I want land and a big house since we are collectors of many things.
We will have a smaller down payment we're looking at trying for 10%. However we are elligible for a VA loan (FI spent 10 years in the Navy before meeting me) so after a few years of credit rebuilding for both of us it shouldnt kill us too much to go in with a lower payment since we're taking a military loan.That is atleast a saving grace for us. We've calculated the payments and they should be very managable for us.
50,000 downpayment (20%)
8,000 for closing costs
15,000 left over in savings
So we're looking at a total of 73,000 before we even start looking at houses. It will take us about 2.5 years to save that much.
100,000 downpayment, around 8,000 for various costs (lawyers, etc, etc) and we have about 15,000 left over just hanging out for emergencies.
We're in NYC so its an apartment. When we leave and sell it, we will be able to buy a house almost anywhere else for less. How much it was is shocking but the monthly costs are WAY less than renting so outside of the downpayment (an investment) it is saving around 400 dollars a month or more in rent.
We put down $150k on our $510k house. We alsepsis closing costs/lawyer fees etc and had $50-$75k in the bank after closing.
@Stace126: Wow! If only houses in New Jersey were as good as that.. The average house in my area is 350,000. Go up a little bit north, just maybe the next town over, and the prices go up to average 550,000. Go a little more north and your in Alpine.. which was the most expensive town to live in last year, I believe. NJ sucks.
@Stace126: +1, so glad I moved out of CA (where the average home prices were $500k+). We would've never been able to afford the home we have now.
Here's our breakdown:
$30k (20%) down
$9k furniture, appliances, etc.
6 months emergency living expenses
Anything left over each month is for our wedding fund. My FI and I are trying really hard to stay out of debt (no car loans, no student loans, etc.) since he's the only one working.
@CheesyPotatoes: We are looking in the South Hills -- West Mifflin, Munhall, Dormont, Brentwood, Baldwin, Whitehall, Jefferson, South Park. All of my friends and family have lived around here our entire lives. Average homes, average people with average incomes.
It's not Fox Chapel or Upper St. Clair, but it's not like we're living in housing projects with drug busts every night and prostitutes on the corner. lol.
Where are from? I get a lot of "OMG you LIVE there?!?!?!" when I tell people where I live. But honestly, it's a totally normal, safe suburb.
Interesting.
@dewingedpixie: Just a note of caution, my friends ended up not being able to buy a foreclosure with a VA loan because the foreclosures would not pass VA inspection standards. It may be something for you to look into more deeply while you are in the planning stages. I knoiw it was a very frustrating surprise for them when they went to get the loan approved after they were under contract. They ended up going conventional rather than VA because of the issue. And honestly, it wouldn't pass because the deck needed repaired. I mean, really?!?!
@lovekiss: We are well aware of this, a friend of mine had these issues in CA. FI will have any house we buy very well inspected including the septic field or anything else that may need repair. We have no issue gutting a kitchen I hate or a basement but we dont want costly repairs to a foundation, septic field, etc.
We are looking to buy a home in the spring. Excluding retirement funds and the condo we'll sell for the downpayment, I think we have over $275K. The condo is worth $400K and is mortgage free. We are in our 30s.
I bought my house about 6 years ago. Went with VHDA loan. It was 104% Financing. We bought the house for 100k. We had NO down payment and NO PMI as it wasn't required by our loan. We also qualified as for the loan as we were first time home buyers. I don't think that deal is still around though...
When I refinanced my home to put my then FI on the mortagage we didn't have a downpayment then either. The house was appraised at 30k more than I bought the house for so we didn't have to have PMI. And Capcenter does refinancing without any closing costs.
For our next house we are going to save 10k before looking. The loan we were looking at requires 5% downpayment. If we sell our house for between 130-150k that will give us some additional money to work with. But I would probably use a good bit to pay down or off my college loans.
Basically I had been saving since i was 18 and kept saving while i was in college. When i met my spouse, he was broke and forclosed his first home. So i used part of my savings to buy our first home together and we were very frugal for the last 6 years. We didnt spend on anything we didnt need. Plus i havn't been really working since my first son was born so it was like 6 years ago, but i do some investments in real estate with my family so i make some $$$$$ on the side. My husband's income was the only stable income which we use to pay student loans and mortgage and other bills. Now its harder to save monthly and i get frustrated because we have two kids and they are expensive too. Hope we will do better in 2013...
We saved like crazy people before we bought our house. DH moved out of his city condo and back in with his parents after a year of dating, and I lived with my parents. We were living with minimal expenses for about 2.5 years before we needed to cough up the money for the house. We were able to put down $100,000. We cashed in our RRSPS which we each had $25k, plus savings and some $ from the wedding which was about $100,000 plus our closing costs etc on top of that. It was really hard but managed to save everything we could and lived off of what we could while doing so.
I took on a 2nd job after work, as well as made some extra cash on weekends helping out at various jobs in the area, DH too.
Best of luck! It's so worth it when you get the keys :)
@housebee: stamp duty is a one off payment for the transfer of the home. Every time the home changes owner the buyer has to pay duty. We also have rates & land taxes which are billed quarterly after the land is bought
Wow, I'm a little freaked out right now! I didn't plan on saving quite that much as most of you have. Our houses we have looked at are in the 175,000-200,00 range and with a very small down payment the mortgage cost is the same as our rent.
@ella86: Don't freak out! If you are looking at homes in the $175-200k range, chances are your living expenses are also lower than in many areas, so you need less in savings to cover moving costs and emergency expenses.
Also, threads like these tend to get responses from the best savers, while those who had less in the bank don't post. You might get more representative responses from the Bees by adding a poll.
@ella86: Don't stress out! Everyone is buying a different house, and in different stages of life. For us, for example, we may have saved a lot more, but we live in an expensive area and we're looking to buy a home 4x the cost of yours ($750-850K). Just make sure you have enough money in the bank for an emergency fund (e.g. you lose your job) and a contingency fund in case anything happens soon after buying (e.g. need to repair the roof).
@kay01: YIKES! Yeah, houses that expensive in my area are acutally in the neighborhoods you find many MD's and lawyers and such. And they are on the outskirts of the county far away from everything. The avg home here sells for about $300,000.
@ella86: Well, I am a lawyer...but I work for the government now instead of a large firm like you may be thinking. We want a 3-4 bedroom place in one of the good school districts close to public transportation. A yard and garage would be nice. That, sadly equals a high price tag. If you want something like a renovated kitchen, large yard, attached garage with opening to house, good layout, it goes up even higher than that. :(
We are saving at the moment. Not going crazy yet, just putting what we can but still spending a lot on crap. We've spoken about no more than 350k to borrow, which will get us a 3/4 bedroom place, open plan and brand spanking new. We want to build, but there's a chance to pick up a 1-2 year old houses around here as estates are growing.
We will go in with 15-20k for the deposit.
Did any of you have large student loans? It's hard to save up for a home and children when you're trying to dig yourself out of a hole and aren't making much. (clearly I'm in my young/mid 20s)
Come January we will start saving for a house. Homes in our area are around the $300-350k range, so we are gonna try to save at least 60k before we look at building or buying anything. Ideally I'd rather we save 100,000 but I don't see that happening.
Every person's situation is different. We're going to close (hopefully) at the end of Jan. Houses in Maryland (as Mrs. LK noted) ain't cheap! But because of my employment as a physician, I qualified for 100% financing through a doctor loan. I needed full financing since I just finished residency and have been supporting the husband, paying for the wedding, paying for a new car since DH's car died last year etc. = not much in savings. So I'm putting $6k towards closing, and the rest is financed. Thing is, we found an awesome little house that was maintained amazingly well. We'll have no repairs or renovations to do for quite some time. Also, with interest rates as low as they are now, if I put in even just $1k extra per month, I'll have the place paid off in just 16 years without the commitment of the 15 year mortgage payments. I have tons saved up in retirement, though I'd only touch that if things were dire. I also have disability and accident insurance both through work and privately purchased in the event something happens to me which would prevent mortgage payments. All that being said, I'll probably have about $15-20k or so after closing at the time we move in. But I'm an exception rather than the rule. I think one should generally plan on about at least 3 months' of mortgage payments/bills etc before proceeding to move.
@love108: Uh, yeah. That's another reason why I don't have much saved up. I graduated with almost $200k in med school loans, which is a second mortgage in and of itself! It's almost like we're being punished for doing the right thing. Ths US has its priorities totally out of whack!
We bought our house for 309K (30K under what they were selling for in 08-owner was in the military and had to move pronto). We put down 15K, 14K in closing fees. The rest went to furniture and stuff for the house as we lived with our parents prior to getting married. NJ sucks big time, lemme just say that for a 1800 sf house with 25 feet of backyard and 10 foot side yard we're forking over 7,500 in taxes a year. Argh!
Honestly, I wish we waited a year and lived with our parents -would've been able to save at least 75K, but hubs was stubborn and wanted his own house. If you can live with the parents and save save save.
You must log in to post.
| User | Posts Today |
|---|---|
| AlwaysSunny | 58 |
 mrsSonthebeach |
34 |
| Birdi | 34 |
| Chelwilly | 33 |
| FutureMrsHall15 | 32 |
| mousepeach | 31 |
| lealorali | 29 |
| Holly77 | 29 |
| sharontobemarried | 28 |
| julies1949 | 24 |
| User | Posts Today |
|---|---|
| kgirl91 |
5 |
| ItWasntMe | 4 |
| monet11 | 4 |
| fresitachulita | 2 |
| FreckledFox | 2 |
| ItsHollyAgain | 2 |
| trueblue14 | 2 |
| Miss Leopard | 1 |
| cbee | 1 |
| Usuki | 1 |
