Post # 1
Hi Bee’s –
My Fiance and I found a great home this weekend. We already got the seller’s to bring down the price by 9k but we would need them to come down by about more 5k for us to even consider purchasing.
We were preapproved by the bank for a ridiculous amount, so we just told them to put 250k on the preapproval letter. The home we found was orginally going to be listed for 239k…because I am going back to school soon my Fiance and I didn’t want to go above 215K. The sellers agreed to bring down the price to 229k. This would be not a huge deal if the seller was going to pay closing costs but they aren’t.
My question is, did you all stick to your budgets when home shopping? I do NOT want to be house poor, just curious on what you bee’s did.
Post # 3
- Wedding: August 2013 - Rocky Mountains USA
Yes, we were well under the top of our budget range. (And about a third of what the bank told us we were pre-approved for!) I also did NOT want to be house-poor.
Post # 4
We did stay in our range. We ended up in about the middle of it actually once negotiation were done. It was listed at the top of our range.
I agree you dont want to do house poor, but figure out your monthly payment.
If you are already stretching to make it, another 20-50 could make a huge difference, but if its a comfortble payment, then paying a couple thousand for a house will not really be noticeable in your payment
Assuming 20% down, no PMI and 3.25% interest rate and 1.25% property tax a house priced at 229K is a $1,025 payment
Same assumptions, but a $219K house is a $990
That is only a $35 dollar difference. Is that worth losing the house over, assuming you have the down payment for both houses?
Post # 5
Our original budget was 180 when we were looking in a particular area (suburbs w/ high taxes). We changed our search to the city where we could afford more and upped it to 200k. After seeing 3 houses we decided to push it to 225 only because it was a good searchable number but never did we consider any that high. In the end we paid 208.
It was a big battle becuase we had lost out on a house and I didnt wanna pay more for this one since it was smaller and not as perfect plus the sellers were underwater. Because they were under we got zero help with closing. We had to bring a big chunk of change to the settlement table.
Find out what the sellers paid on the house. Usually that will tell you if they are willing to go lower.
Post # 6
We were within budget, but closer to the top of our range. Our home was 175, we had a budget of up to 180, but we wanted to ideally stay in the 160’s. All of the homes we researched in the 160’s were fixer-uppers, whereas our home was in very good condition and had the space and floorplan we wanted. We were also worried about being house poor so we decided we didn’t want the risk of a fixer even though it was cheaper. I’m really happy with the decision we made.
Post # 7
@ThreeMeers: We are not putting a down payment on our first home. I am 23 and Fiance is 24. We are using the military credit union (via our parent’s being members) which charges a 4.125 interest rate which is excellent for no money down. This property will be lived in for 3 – 5 years and then used as rental property. (I have amply knowledge on rental’s because I help my Dad with his 5 homes that he uses at rentals).
So with the interest, prop tax, homeowners insurance our payment would be $1271 we currently pay $1166 in rent so it wouldn’t be a HUGE jump. But we would have to use cash for our closing cost which we currently intended on using to pay for part of the wedding. If we weren’t paying for the wedding ourselves we would totally put a down payment on the home.
I would really suck to lose this house, it’s in prime location…but I won’t be distraught if it doesn’t work out.
Post # 8
@MASPA: The sellers our going to take a lost on their home. They purchased the home for 240k in 2004 right before the housing crisis. It shows that they tried to sell it two years ago but didn’t get an offer they wanted. With the price they are offeriing to us they are taking an 11k lost, but we still think they could go a bit lower.
Post # 9
Yes we stayed in our price range and its well worth it!
Post # 10
We ended up spending 40k less than our ideal budget.
Post # 11
@Meant2Bee: If they are already taking an 11k loss I am not sure if theyd be willing to go lower. They probably cant go much lower unless they put the full 20% down. And even then, they want to make back as much money as possible.
Post # 12
@Meant2Bee: Dont forget you can ask for other things besides a $ decrease that can save you money.
Maybe they have patio furniture or appliances or other items that you want included in the selling price. This is stuff you dont have to pay $ for when you move in.
But we would have to use cash for our closing cost which we currently intended on using to pay for part of the wedding.
Does this mean you payign cash no matter what? If you dont have a downpayment, this amt should be about the same no matter the price. so is this the what your worried about when buying the house?
Post # 13
We had kind of a vague idea of what we wanted to pay, and that was basically out of line for what things in our area cost after you factor in the bidding wars (we were naive enough to think that we would be able to pay asking price, hahahahaha not so much….). However, we didn’t stretch past what we could easily afford.
We thought we could get away with paying $420,000 for a 2-bedroom townhouse. We ended up paying just shy of $500,000. Worth every penny, and units that are smaller than ours have already sold for more than 10% more within days of hitting the market, so I really believe that it was an awesome price and great investment.
Post # 14
We were about 20-30K under what we felt comfortable with.
Post # 15
Yes. My mortgage lender kept telling me that I qualified for $260k but he was so good to me. He knew I was in my early 20s and starting off in my adult life and he knew the bubble was coming, so he kept me relegated to shopping in the $180s. I’m so glad he did.
He told me that the mortgage payment is what matters most and I should have more than enough room in my budget for it just in case something happens. I bought my house in 2007. Now my Fiance and I are talking and making future plans and we can comfortably save for a much more expensive house and keep my old house too without feeling obligated to rent it out to have someone else cover the note.
Definitely stay within budget to afford yourself options in the future.
Post # 16
- Wedding: October 2011 - Bed & Breakfast
Yes and No. LOL When we were hunting pre-wedding we were looking in the $400k range to allow ourselves the 20% downpayment/closing costs/emergency fund and make sure we had plenty of cash left over to pay for the wedding. Since we were still hunting after the wedding, and I hadn’t even touched one wedding account, we had extra money to have a larger downpayment, which enabled us to increase the budget to $500k and still have the 20% down payment and closing costs and 6 month emergency fund. So we increased not because we were being willy nilly, but because we had the downpayment funds available and it was still a mortgage amount that we could support on one salary, if necessary.