Step by step real estate process

[the.gladiator1987]

Im just trying to get an understanding of what steps and processes are taken when you try to buy a house, condo, duplex, etc. Im not planning on doing it anytime soon but I want to learn how it is all done and see if you guys have any experience in it. I know shirlene does..

Also any good books to read about real estate and investing in it?

I also just made a deal with my bro to get my seed biz back! So IM excited about that, im gonna start adding new items, but first I need to expand my traffic with adwords from google.

im so excited to be rich, ill be hostin EF meat-ups at my house, ill provide food and bishes so you fuckers dont have nothin to worry about except giving me advice on how to get there

 

[-SD-]

Jesus loves you rob.

 

[cindylou]

lol

 

[RottenWillow]

Whatever you do, please do not spend $150 on some jackass's "secrets to RE investment". There are no secrets. My mother started in RE investment in 1991 and graduated from single family homes, to duplexes, to quads, to 16 unit apartments, to 200+ unit apartment complexes. It just takes hard work.

 

[stevesmi]

answer these as honestly as you can and I will tell you right away if you are qualified for a 150K home/condo

how much do you have for a down payment?
how is your credit? score? ever miss a payment? how much credit do you have vs. your balances on your CC's?
education level? (they ask but this isn't as important as other things but it can make a slight difference in persuading them)
criminal history?
income over the last 2-3 years?

 

[cindylou]

he has bad credit, no education, has a felony and low income

 

[lartinos]

Once again, this makes no sense for you man. You have 0 capital. You have to be approved for a loan before you can buy anything.
You need to have a solid credit history and some actual "assets". The Geo doesn't count. There are no get rich quick schemes.

 

[the.gladiator1987]

answer these as honestly as you can and I will tell you right away if you are qualified for a 150K home/condo

how much do you have for a down payment?

Well my brother said he would help me with the down payment so it really is still up in the air.
​

how is your credit score?
mid to high 500's. But in 6 months, ill have had almost a year with no missed payments, and a blanace lower than half my limit at all times. Plus Im getting a secured cc so that should help with my credit as well

ever miss a payment?
Yes but ive had my cc for 3 years

how much credit do you have vs. your balances on your CC's?
I have one cc. The balance is $120, limit is $300

education level? (they ask but this isn't as important as other things but it can make a slight difference in persuading them)
Almost have an AA

criminal history?
1 felony, 1 misdemeanor. felony gets expunged in september 2011

income over the last 2-3 years?
Not a lot. probably between 20k-30k

See above.

 

[the.gladiator1987]

Whatever you do, please do not spend $150 on some jackass's "secrets to RE investment". There are no secrets. My mother started in RE investment in 1991 and graduated from single family homes, to duplexes, to quads, to 16 unit apartments, to 200+ unit apartment complexes. It just takes hard work.

I wont. Promise, I actually wanna do it like my brother did it. Start off small, but eventually youll make some good profit, turn it around, and start something bigger

 

[the.gladiator1987]

Jesus loves you rob.

lolephant

 

[stevesmi]

once u build ur credit and save for a down payment I would recommend mortgage broker who will pre-approve you then after you know how much house you qualify for hiring a good experienced realtor.

step 2: you look for a house you want with the realtors help
step 3: after you find the house present them with a contract with your offer
step 4: negotiate price
step 5: once you figure out the price fax the mortgage broker the contract
step 6: you have time to inspect the house (usually 3-5 days) and being able to pull out of the agreement without losing your deposit.. inspect the house with YOUR OWN independent inspector (not the realtors buddy) check the roof closely, check for mold problems, check for water in the walls, leaks, you might even hire a roofer and plumber if the inspector isn't that experienced.
step 7: if you are happy with the inspection then just request small repairs (all homes have small stuff)
step 8: you sit back and relax and wait for closing day.
step 9: on closing day bring your down payment

pretty simple

 

[the.gladiator1987]

Once again, this makes no sense for you man. You have 0 capital. You have to be approved for a loan before you can buy anything.
You need to have a solid credit history and some actual "assets". The Geo doesn't count. There are no get rich quick schemes.

lol I said that this wasnt going to be soon. Well, maybe soon but not for another 6 months at least. My credit will be solid by then!

And does ebay biz count as an asset? What about an '01 ford focus im about to have? This isnt a get rich quick scheme. Ive never asked for advice on how to get rich quick. i realize that this takes work. So why do you keep sayin this shit bro?

I said silver would be long term
I said real estate wouldnt be till my credit is good and i have some down payment

 

[stevesmi]

See above.

your best bet for now is paying cash for a house.

you won't get approved.

you have 200 some dollars of credit right now, how do you expect me to trust that you will pay me every month? as a landlord i wouldn't even rent you a house, much less let you borrow 150K expecting you to pay that back with those stats.

keep building ur credit and saving ur money.. pay on time!!

it takes 3-7 years for your credit to not show a missed payment. not 6 months. and that is just a part of your credit score.. you forget about 'amount of credit' you only have 200 or so of available credit. you need to get that increased and i would even suggest getting another credit card. keep ur balance LOW. that is how you build credit.

 

[the.gladiator1987]

once u build ur credit and save for a down payment I would recommend mortgage broker who will pre-approve you then after you know how much house you qualify for hiring a good experienced realtor.

step 2: you look for a house you want with the realtors help
step 3: after you find the house present them with a contract with your offer
step 4: negotiate price
step 5: once you figure out the price fax the mortgage broker the contract
step 6: you have time to inspect the house (usually 3-5 days) and being able to pull out of the agreement without losing your deposit.. inspect the house with YOUR OWN independent inspector (not the realtors buddy) check the roof closely, check for mold problems, check for water in the walls, leaks, you might even hire a roofer and plumber if the inspector isn't that experienced.
step 7: if you are happy with the inspection then just request small repairs (all homes have small stuff)
step 8: you sit back and relax and wait for closing day.
step 9: on closing day bring your down payment

pretty simple

Ah damn that is simple. Thanks steve, down payments are usually 10-20% right?

Like I said my bro will help me out with the down payment. I should also be able to get some good referrals from him. He knows a lot of people and I truly believe that it helps to know as many ppl as you can, networking. You can never know too many people and you never know who you meet might just be a golden opportunity, but you may never know it if you dont go out there and network

 

[RottenWillow]

Without money or credit one needs business connections to get started. I'm sure there are no NIV loans around anymore. My mother had no capital and no credit to speak of when she bought her first few properties. She did however know people. She'd been a RE agent for 3 or 4 years and knew how things could get done.

I'd suggest as a first stop to someone who is really serious find and join your metro/state level RE investors association. Build business relationships.

 

[stevesmi]

Ah damn that is simple. Thanks steve, down payments are usually 10-20% right?

Like I said my bro will help me out with the down payment. I should also be able to get some good referrals from him. He knows a lot of people and I truly believe that it helps to know as many ppl as you can, networking. You can never know too many people and you never know who you meet might just be a golden opportunity, but you may never know it if you dont go out there and network

you can get a FHA loan for as little as 3.5% down. but that is only for people with good credit and the house you are buying has to have built in equity if that makes sense. the appraised value of the home has to be higher then what you are paying in other words. and ur interest rate wont be good

if you put 20% down with good credit they will kiss your feet. you can get a mortgage rate of 4% right now. its a steal.

 

[lartinos]

lol I said that this wasnt going to be soon. Well, maybe soon but not for another 6 months at least. My credit will be solid by then!

And does ebay biz count as an asset? What about an '01 ford focus im about to have? This isnt a get rich quick scheme. Ive never asked for advice on how to get rich quick. i realize that this takes work. So why do you keep sayin this shit bro?

I said silver would be long term
I said real estate wouldnt be till my credit is good and i have some down payment

I hear that you have good intentiuons. This is a horrible idea for you. All the "ideas" you have a are for well established people with a lot of income and capital. You will be lucky to be in that position in 20 years led alone 6 months. Here's example of the type of idea you need. Not necessarily this one, but along these lines. Save money for a decent powerwasher. Then start advertising in every way possible. Interent fanpage, flyers, word of mouth. From there start painting peoples houses or something. Eventually with hardwork you could opwn your own company. But, from what you say on here it sounds like you just waste your life playing video games and destroying your life by getting woman pregnant. Change your ways or you will be sorry.

 

[the.gladiator1987]

Ok damn..i know there are duplexes for cheap like 20,000

thx for all the advice brotha. i DO need my amount to go up....and no more missed payments for me. Youre right, 200 is pathetic ahaaa

your best bet for now is paying cash for a house.

you won't get approved.

you have 200 some dollars of credit right now, how do you expect me to trust that you will pay me every month? as a landlord i wouldn't even rent you a house, much less let you borrow 150K expecting you to pay that back with those stats.

keep building ur credit and saving ur money.. pay on time!!

it takes 3-7 years for your credit to not show a missed payment. not 6 months. and that is just a part of your credit score.. you forget about 'amount of credit' you only have 200 or so of available credit. you need to get that increased and i would even suggest getting another credit card. keep ur balance LOW. that is how you build credit.

 

[the.gladiator1987]

you can get a FHA loan for as little as 3.5% down. but that is only for people with good credit and the house you are buying has to have built in equity if that makes sense. the appraised value of the home has to be higher then what you are paying in other words. and ur interest rate wont be good

if you put 20% down with good credit they will kiss your feet. you can get a mortgage rate of 4% right now. its a steal.

Ok so my goal should be 20% down, what is considered good credit for getting a FHA loan?

 

[the.gladiator1987]

I hear that you have good intentiuons. This is a horrible idea for you. All the "ideas" you have a are for well established people with a lot of income and capital. You will be lucky to be in that position in 20 years led alone 6 months. Here's example of the type of idea you need. Not necessarily this one, but along these lines. Save money for a decent powerwasher. Then start advertising in every way possible. Interent fanpage, flyers, word of mouth. From there start painting peoples houses or something. Eventually with hardwork you could opwn your own company. But, from what you say on here it sounds like you just waste your life playing video games and destroying your life by getting woman pregnant. Change your ways or you will be sorry.

I see what youre saying. The diff is that Im trying to make money work for me, not the other way around. If I wanna start any business Im going to do something im passionate about. not something i hate like powerwashing. Id rather invest in my ebay biz and make it a supp biz, expand products, i know its not the besat way but im passionate about it and that means more to me

btw i sold the xbox lol. and hopefully the kids not mine!

 

[stevesmi]

Ok damn..i know there are duplexes for cheap like 20,000

thx for all the advice brotha. i DO need my amount to go up....and no more missed payments for me. Youre right, 200 is pathetic ahaaa

you dont have the funds to repair a destroyed foreclosed duplex like that. i know a guy who bought a house for 80K that was in bad shape. he spent another 80K to fix it up. no way he can sell it for 160K. its just a waste.

buy a house that doesn't need repair, trust me from personal experience.

 

[RottenWillow]

once u build ur credit and save for a down payment I would recommend mortgage broker who will pre-approve you then after you know how much house you qualify for hiring a good experienced realtor.

step 2: you look for a house you want with the realtors help
step 3: after you find the house present them with a contract with your offer
step 4: negotiate price
step 5: once you figure out the price fax the mortgage broker the contract
step 6: you have time to inspect the house (usually 3-5 days) and being able to pull out of the agreement without losing your deposit.. inspect the house with YOUR OWN independent inspector (not the realtors buddy) check the roof closely, check for mold problems, check for water in the walls, leaks, you might even hire a roofer and plumber if the inspector isn't that experienced.
step 7: if you are happy with the inspection then just request small repairs (all homes have small stuff)
step 8: you sit back and relax and wait for closing day.
step 9: on closing day bring your down payment

pretty simple

This is the standard method a prospective buyer finds their personal residence. It's doesn't bear much semblance to the method my mother used successfully for buying investment properties her first 3 or 4 years as an investor.

1)Down payments are not mandatory
2)Credit is not mandatory
3)Creativity is mandatory
4)Diligence absolutely mandatory
5)Ability to build and successful use business relationships is a must
6)Persuasiveness/salesmanship is a must


It's really points #5 and #6 that the real estate infomercial scammers never tell you.

 

[the.gladiator1987]

you dont have the funds to repair a destroyed foreclosed duplex like that. i know a guy who bought a house for 80K that was in bad shape. he spent another 80K to fix it up. no way he can sell it for 160K. its just a waste.

buy a house that doesn't need repair, trust me from personal experience.

Ok. Well its nice to have a brother who owns his own business, has a bunch of money saved up, and is willing to help with a down payment. Ill talk to him about getting m credit up and getting another cc. Where can i sapply for another cc right now? And can i find out right away if i can get the cc?

 

[the.gladiator1987]

This is the standard method a prospective buyer finds their personal residence. It's doesn't bear much semblance to the method my mother used successfully for buying investment properties her first 3 or 4 years as an investor.

1)Down payments are not mandatory
2)Credit is not mandatory
3)Creativity is mandatory
4)Diligence absolutely mandatory
5)Ability to build and successful use business relationships is a must
6)Persuasiveness/salesmanship is a must


It's really points #5 and #6 that the real estate infomercial scammers never tell you.

Im def going to start talking to people, learning, and networking. Thx rottenwillow

 

[samoth]

What the hell's wrong with you, dude. Go to Amazon, search RE, browse textbook TOCs and find something at your level that will increase your understanding of a subject.

Jeez, no wonder for-profit unis are making a killing... people really don't know how to learn anything on their own.

 

[stevesmi]

Ok. Well its nice to have a brother who owns his own business, has a bunch of money saved up, and is willing to help with a down payment. Ill talk to him about getting m credit up and getting another cc. Where can i sapply for another cc right now? And can i find out right away if i can get the cc?

you cant be given money by someone else to buy a house. they are not stupid. if you make 20K per year they are gonna figure out the down payment is not from you.

the money has to be from you, not a relative.

 

[the.gladiator1987]

What the hell's wrong with you, dude. Go to Amazon, search RE, browse textbook TOCs and find something at your level that will increase your understanding of a subject.

Jeez, no wonder for-profit unis are making a killing... people really don't know how to learn anything on their own.

I just wanted to get ppls opinions from EF cuz u guys are like family. not you tho, ur like the mean sister

 

[the.gladiator1987]

you cant be given money by someone else to buy a house. they are not stupid. if you make 20K per year they are gonna figure out the down payment is not from you.

the money has to be from you, not a relative.

lol i already talked to my brother and he said hed help me with a down payment so....

 

[stevesmi]

lol i already talked to my brother and he said hed help me with a down payment so....

no the mortgage company will not allow that. you cannot be given money by a relative. it has to be your money.

the mortgage company is gonna want to see your assets. and if you say you are putting X money down and have no money in your bank account then there is a problem.

your brother has to give you the money first, which is a major risk for him.. cuz you can do anything with that money.

 

[samoth]

I just wanted to get ppls opinions from EF cuz u guys are like family. not you tho, ur like the mean sister

You're not going to learn a complex process from a message board.

I'm the mean teacher telling you to stop talking to your buddies, pick up your textbook, and do your homework.

 

[shirlene29]

ok...look, with those scores and not at least two years of a clean slate of credit (that means no lates for two yrs minimum) you don't have a snowballs chance at a mortgage...people with great credit are getting turned down right now

you can be gifted down payments for some loans and not others...ALL of the government programs are intended to buy a primary residence...that means no investment property

I bought a 7 family dump when I was your age at a town tax auction...I paid 10 grand in certified funds...it came with 70k in back taxes at a compounded interest rate of 18% ...I made a deal with the town to pay them 1500 a month to keep tax foreclosure at bay

it was 6000 sq ft and the yearly taxes were a little over 6k..it had a water bill of about 3k a yr, a heating bill of a little over 3k a yr..

it needed ALL new applianxces, a new roof, wiring new kitchen cabinets flooring and a whole LOTTA paint

I also replaced lighting, bathrooms, installed hot water tanks to get the hot water off the oil
I kept it for 7 yrs and depreciated the shit out of it to avoid a heavy tax burden when i sold it
I had to learn how to navigate the legal system for evictions and get ruthless with people I knew over rent...

I went wildly unprotected by fire insurance and possible lawsuits...I was sued four times over the place, a tenant stole all the toilets out of the commercial space and ripped everything off the walls
my cars have been keyed, one apartment was covered in swastikas

another tenant shot and killed my dog
between me and my ex husband, we did all of the repairs and remodeling ourselves...I had many a small war with the town
i maxed out every credit card i had at one point just trying to keep my head above water
I sold it for a little over 200k in the end and bought a big single family house and raw land

the people that bought the place barely keep up between the mortgage and the bills...they arent making money

I have several points to this little summary
it used to be you could buy property fairly cheaply through tax auctions, i have no idea if thats still true
it will be a dump and will take a shit TON of sweat equity, there is almost no way to avoid spending practically 24/7 working at it

if you don't keep up with the learning curve you will drown!

i actually intend on looking for a duplex or triplex next year for around 50k to buy outright

 

[-SD-]

ok...look, with those scores and not at least two years of a clean slate of credit (that means no lates for two yrs minimum) you don't have a snowballs chance at a mortgage...people with great credit are getting turned down right now

you can be gifted down payments for some loans and not others...ALL of the government programs are intended to buy a primary residence...that means no investment property

I bought a 7 family dump when I was your age at a town tax auction...I paid 10 grand in certified funds...it came with 70k in back taxes at a compounded interest rate of 18% ...I made a deal with the town to pay them 1500 a month to keep tax foreclosure at bay

it was 6000 sq ft and the yearly taxes were a little over 6k..it had a water bill of about 3k a yr, a heating bill of a little over 3k a yr..

it needed ALL new applianxces, a new roof, wiring new kitchen cabinets flooring and a whole LOTTA paint

I also replaced lighting, bathrooms, installed hot water tanks to get the hot water off the oil
I kept it for 7 yrs and depreciated the shit out of it to avoid a heavy tax burden when i sold it
I had to learn how to navigate the legal system for evictions and get ruthless with people I knew over rent...

I went wildly unprotected by fire insurance and possible lawsuits...I was sued four times over the place, a tenant stole all the toilets out of the commercial space and ripped everything off the walls
my cars have been keyed, one apartment was covered in swastikas

another tenant shot and killed my dog
between me and my ex husband, we did all of the repairs and remodeling ourselves...I had many a small war with the town
i maxed out every credit card i had at one point just trying to keep my head above water
I sold it for a little over 200k in the end and bought a big single family house and raw land

the people that bought the place barely keep up between the mortgage and the bills...they arent making money

I have several points to this little summary
it used to be you could buy property fairly cheaply through tax auctions, i have no idea if thats still true
it will be a dump and will take a shit TON of sweat equity, there is almost no way to avoid spending practically 24/7 working at it

if you don't keep up with the learning curve you will drown!

i actually intend on looking for a duplex or triplex next year for around 50k to buy outright

You still want to get into real estate glad?

 

[the.gladiator1987]

yea I do lol i just need another 6 months to a year to save up, build credit (562 is a lot better than what i had last year - 300 something)

steve - why cant my brother loan me cash and i can tell the mortgage ppl i have been saving up?

 

[shirlene29]

yea I do lol i just need another 6 months to a year to save up, build credit (562 is a lot better than what i had last year - 300 something)

steve - why cant my brother loan me cash and i can tell the mortgage ppl i have been saving up?

because theyll want every scrap of paper to verify that including accruing dollar amounts in an account...and will ask for the very same paperwork (updated) over and over again

we got hassled over 401k and that was easily verifiable...as was savings, bonds etc etc
and whats called a 'reserve' wasn't even required for the mortgage we got on this place

 

[calveless wonder]

you should start learning things on your own instead of relying on EF for advice you will never take anyways

 

[lartinos]

The problem with this thread are people giving glad ridiculous advice. Giving him this fake opportunity to do real estate investing, lol.
If you want to help him give him real advice like some are giving on here. And I understand that you want to do something that you are passionate about.
But Glad.... Do you think I worked at a clothing store for most of my twenties because I was passionate about it? No it paid me a decent salary because I worked my way up to the highest volume store through hard work and I was only able to deal with it because of the enormous amount of pussy there.
Eventually I realized I couldn't move up and I started my own business after running clothing stores for years. You should be happy doing the type of work I said and building it up. Eventually it is possible that your business could do well and you could hire employees and have your money work for you. To think it is that simple to make money is idiotic and you will be on welfare and possibly thrown in jail eventually with the decisions you make. I want you to succeed Glad, but I just have little faith in your work ethic. When the baby fees become reality maybe you will snap out of it. IDK

 

[kx250rider]

When you're ready with funds on deposit to make a down payment (at least 10% or 20% better), or maybe 5% if you qualify for any gov't programs or are a qualified veteran, just use common sense... Get a good broker who KNOWS the area you're looking in, and not a young new one who is desperate for his/her first sale. Go for the worst house in the best zipcode you can afford... You can always fix up a house, but you can't fix up a neighborhood. Not sure about laws in places other than CA and TX, but in case of a "short sale", STAY AWAY. They can take and keep your deposit for LONG periods of time while the lender "thinks about" your offer, and in the mean time, you're locked in and can't go for a better deal if one shows up. Short sales are only good for investors who can afford to wait for months and maybe or maybe not get the house. Have a lawyer read the loan papers, if possible. There are so many twists and tricks, that the smartest buyer can be fooled into getting a terrible loan. Buying a fixer-upper is OK if you're going to have the time & $ to do the work yourself, and IF the house is in OK shape to live in while you're working on it.

Charles
Buyer & seller of several properties since age 18, and not successful in all of them...

 

[75th]

lol @ people not realizing by now that glad is a troll.

 

[billfred]

Glad,

Let me throw my 2 cents in here. I want to preface what I have to say with the fact that I have just paid off my 4th mortgage in my life. Most people never pay off one.

A house is a place to live - not an investment. However, it is also a great place to build some wealth for one reason and one reason only, it is not very liquid (hard to spend). When you want a new xbox, if you have money in the bank, you will get the new xbox. If you have money in equity in the house, you will not. That is why it is the thing for you to do.

An added benifit is it provides a warm dry place to sleep at night.

I highly encourage you to find a place to live and look at it just as that. Get your parents to help you with down payment and a loan. The sooner you do it the better. Pay a little extra on the mortgage every month so you can build your equity and ultimately your wealth.

Listen to RW - she is giving you the straight scoop here. Just about everyone else you can ignore.

 

[RottenWillow]

Glad,

Let me throw my 2 cents in here. I want to preface what I have to say with the fact that I have just paid off my 4th mortgage in my life. Most people never pay off one.

A house is a place to live - not an investment. However, it is also a great place to build some wealth for one reason and one reason only, it is not very liquid (hard to spend). When you want a new xbox, if you have money in the bank, you will get the new xbox. If you have money in equity in the house, you will not. That is why it is the thing for you to do.

An added benifit is it provides a warm dry place to sleep at night.

I highly encourage you to find a place to live and look at it just as that. Get your parents to help you with down payment and a loan. The sooner you do it the better. Pay a little extra on the mortgage every month so you can build your equity and ultimately your wealth.

Listen to RW - she is giving you the straight scoop here. Just about everyone else you can ignore.

Not sure anyone's listening though.

The way truly successful investors do it is quite different from the way homeowners buy their own houses and even different from way most modestly successful investors do it. Over the years mom has run into assloads of people running rentals who seem to barely keep their heads afloat. Really being good at this requires the same degree of real business acumen that any other line of business requires as well as that salesmanship few people have. (I sure as fuck don't)

 

[billfred]

Not sure anyone's listening though.

The way truly successful investors do it is quite different from the way homeowners buy their own houses and even different from way most modestly successful investors do it. Over the years mom has run into assloads of people running rentals who seem to barely keep their heads afloat. Really being good at this requires the same degree of real business acumen that any other line of business requires as well as that salesmanship few people have. (I sure as fuck don't)

I know you said you have 65k in home equity. Very few people here have a hard asset like that. They can all take about what stocks they made money on but usually leave out what ones they lost the same money on or how they pissed that money away.

Building equity in a home is a very tried and true way to build an asset base that you are not going to spend so easily.

The only thing I could add is to buy the smallest house in the nicest neighborhood that you an afford, not a bigger house in an ok neighborhood. Ok neighborhoods now turn to crap ones later, nice neighborhoods always go up in value, even in the bad times.

 

[stevesmi]

steve - why cant my brother loan me cash and i can tell the mortgage ppl i have been saving up?

i'm not gonna beat a dead horse here. you just dont get the way the world works if you ask such a question.

kinda like the guy that once told me "its not fair that someone with bad credit has to pay a higher interest rate" (the pool of lenders shrinks so less competition hence a worse interest rate) or "gosh i didn't know about credit scores, i didn't know i was supposed to repay a loan" (in other words they didn't know when you borrow money you are supposed to pay it back DUH)

i suppose you could pull that scam off by loaning your brothers money ahead of time and then showing them your bank statement with the money in there.. but they are gonna make you sign something saying that you aren't using someone elses money for a down payment. and if you sign it you just commited mortgage fraud

also dont you think its gonna look kinda fishy when you show them your tax return, pay X amount in rent and magically have money for a down payment? you think the mortgage companies are that stupid? you think the FHA is that stupid? they will know you are getting the money from somewhere else.

i will mantain its a dumb investment for you at this time. you are gonna borrow money for a down payment, then take out a mortgage for a house. stick to renting. thats it, i'm done. if you ever want serious advice I am here for you, but this is just silly to even discuss it.

 

[-SD-]

And just in case you havent noticed the past couple years, real estate isnt the sure bet anymore for investing.

 

[stevesmi]

I know you said you have 65k in home equity. Very few people here have a hard asset like that. They can all take about what stocks they made money on but usually leave out what ones they lost the same money on or how they pissed that money away.

Building equity in a home is a very tried and true way to build an asset base that you are not going to spend so easily.

The only thing I could add is to buy the smallest house in the nicest neighborhood that you an afford, not a bigger house in an ok neighborhood. Ok neighborhoods now turn to crap ones later, nice neighborhoods always go up in value, even in the bad times.

i bought my first house when i was 20. i put 30% down and got absolutely ripped off on my mortgage cause i didn't know any better. they screwed me.. 2 points and a shitty interest rate even though i had 200K income and a perfect credit score (the morgage b*tch was the realtors wife) i learned from my mistake. also the house had problems that the idiot inspectors did not find. like it needed a re-plumb, had mold problems, and it had termites. but i didn't know what i was doing. boy have i learned a lot. if i could go back i would laugh in the mortgage ladies face when she offered a bad interest rate and 2 points. and i would of hired my own inspectors (not the realtors buddy)

 

[lartinos]

Glad,

Let me throw my 2 cents in here. I want to preface what I have to say with the fact that I have just paid off my 4th mortgage in my life. Most people never pay off one.

A house is a place to live - not an investment. However, it is also a great place to build some wealth for one reason and one reason only, it is not very liquid (hard to spend). When you want a new xbox, if you have money in the bank, you will get the new xbox. If you have money in equity in the house, you will not. That is why it is the thing for you to do.

An added benifit is it provides a warm dry place to sleep at night.

I highly encourage you to find a place to live and look at it just as that. Get your parents to help you with down payment and a loan. The sooner you do it the better. Pay a little extra on the mortgage every month so you can build your equity and ultimately your wealth.

Listen to RW - she is giving you the straight scoop here. Just about everyone else you can ignore.

Exactly!

 

[samoth]

And just in case you havent noticed the past couple years, real estate isnt the sure bet anymore for investing.

 

[shirlene29]

And just in case you havent noticed the past couple years, real estate isnt the sure bet anymore for investing.

but historically it is...just not in the sense i think glad is thinking of it as


its an almost (yeah almost) sure thing in a time frame of like...15-20 yrs

the days of flipping something have passed...thank god
and I doubt flipping will show up again any time soon

 

[calveless wonder]

but historically it is...just not in the sense i think glad is thinking of it as


its an almost (yeah almost) sure thing in a time frame of like...15-20 yrs

the days of flipping something have passed...thank god
and I doubt flipping will show up again any time soon

this.

it'll almost always go up, it just depends how long you hold onto it.

of course the net result will ultimately be determined by debt service paid out and factors like inflation.

That's not factoring in whether you actually need a place to live anyways or instead have a positive cash flow.

 

[stevesmi]

real estate is no different then anything else. there will be boom or busts.

there will come a day where banks start lending aggressively again and the process will repeat itself. its all a cycle.

i still mantain as someone who has owned 4 properties at one time. and have owned 3 primary homes since I was 20 years old that I would much rather buy a house then rent. the key is buying a good house, not one that is falling apart and needs repairs constantly. and one in a nice neighborhood and getting lucky with good neighbors. it helps when you have a corner lot and a large piece of land. even a crappy neighbor is far away.

i rented an apartment for a year before and it was nice at first, but then it turned into hell. a neighbor behind one wall played rock music at 11pm at night, behind another wall a couple fought, and outside my window one would play his guitar at 2am. so never again will i rent an apartment. no freakin way! and renting a house is crappy as well.. you don't know what your landlord has up their sleeves. they have a key to your house and can come in anytime (yes as a landlord I know the laws well, i can enter your home at anytime if i think there is an emergency and there isn't a damn thing you can do), you don't know if the landlord is gonna sell the house, or raise your rent. contracts dont mean anything, the landlord has all the power (atleast in most states)

 

[calveless wonder]

Glad,

Let me throw my 2 cents in here. I want to preface what I have to say with the fact that I have just paid off my 4th mortgage in my life. Most people never pay off one.

A house is a place to live - not an investment. However, it is also a great place to build some wealth for one reason and one reason only, it is not very liquid (hard to spend). When you want a new xbox, if you have money in the bank, you will get the new xbox. If you have money in equity in the house, you will not. That is why it is the thing for you to do.

An added benifit is it provides a warm dry place to sleep at night.

I highly encourage you to find a place to live and look at it just as that. Get your parents to help you with down payment and a loan. The sooner you do it the better. Pay a little extra on the mortgage every month so you can build your equity and ultimately your wealth.

Listen to RW - she is giving you the straight scoop here. Just about everyone else you can ignore.

That's not neccessarily the most ideal way to leverage your assets. Not knocking it, but most people tend to thinking paying off their mortgage is the smartest financial move. It tends not to make sense to have that much money tied up in 1 asset, especially one that's illiquid.

and i thoroughly disagree with the notion that a home isn't an investment. It can serve dual purposes, as you stated. and lets face it, homes can serve different purposes.

if you put x amount of dollars into a property and carry a note that is manageable, and generates a positive cash flow at the end of the day (when insurance and taxes are accounted for)....that is certainly a worthwhile investment

 

[miplank]

Ok. Well its nice to have a brother who owns his own business, has a bunch of money saved up, and is willing to help with a down payment. Ill talk to him about getting m credit up and getting another cc. Where can i sapply for another cc right now? And can i find out right away if i can get the cc?

Dude, Getting another CC is the dumbest thing you could do for your credit. I'm not sure how many you already have and what the limits are, but with your current income another CC is only going to hurt your score. Your DTI will go up, your score will down. Not to mention the fact that you'd only be setting yourself up for further failure since you can't manage money or credit as it is.

If you truely want to build your credit score get an installment loan, though most likely without a cosigner that's not going to happen. If you can't get a cosigner save up your money or take something of yours worth something and get a secured loan.

 

[-SD-]

real estate is no different then anything else. there will be boom or busts.

there will come a day where banks start lending aggressively again and the process will repeat itself. its all a cycle.

i still mantain as someone who has owned 4 properties at one time. and have owned 3 primary homes since I was 20 years old that I would much rather buy a house then rent. the key is buying a good house, not one that is falling apart and needs repairs constantly. and one in a nice neighborhood and getting lucky with good neighbors. it helps when you have a corner lot and a large piece of land. even a crappy neighbor is far away.

i rented an apartment for a year before and it was nice at first, but then it turned into hell. a neighbor behind one wall played rock music at 11pm at night, behind another wall a couple fought, and outside my window one would play his guitar at 2am. so never again will i rent an apartment. no freakin way! and renting a house is crappy as well.. you don't know what your landlord has up their sleeves. they have a key to your house and can come in anytime (yes as a landlord I know the laws well, i can enter your home at anytime if i think there is an emergency and there isn't a damn thing you can do), you don't know if the landlord is gonna sell the house, or raise your rent. contracts dont mean anything, the landlord has all the power (atleast in most states)

On the flip side I rent and love the complex Im in. Neighbors are great, never hear a word. Complex is quiet, staff is responsive. Rent is dirt cheap and its still on the good side of town. No repairs or maintenance costs draining my cash flow. Allows me to throw money at other business ventures or just discretionary spending. No bubbles to devalue my property by 50% suddenly.
Neither renting nor owning has an absolute advantage over the other.

 

[shirlene29]

On the flip side I rent and love the complex Im in. Neighbors are great, never hear a word. Complex is quiet, staff is responsive. Rent is dirt cheap and its still on the good side of town. No repairs or maintenance costs draining my cash flow. Allows me to throw money at other business ventures or just discretionary spending. No bubbles to devalue my property by 50% suddenly.
Neither renting nor owning has an absolute advantage over the other.

or, you can not buy in a bubble...or count on the house value being correct in the middle of a bubble


its not hard to spot...if the place supposedly doubled in value in 5 yrs...its probably a bubble

 

[jackangel]

lol @ anyone giving a detailed response. brb, gonna give some advice to this brick wall down the street.

 

[miplank]

lol @ anyone giving a detailed response. brb, gonna give some advice to this brick wall down the street.

take your time bro...

 

[billfred]

That's not neccessarily the most ideal way to leverage your assets. Not knocking it, but most people tend to thinking paying off their mortgage is the smartest financial move. It tends not to make sense to have that much money tied up in 1 asset, especially one that's illiquid.

and i thoroughly disagree with the notion that a home isn't an investment. It can serve dual purposes, as you stated. and lets face it, homes can serve different purposes.

if you put x amount of dollars into a property and carry a note that is manageable, and generates a positive cash flow at the end of the day (when insurance and taxes are accounted for)....that is certainly a worthwhile investment

I know what most people think and I understand the math behind that. My thinking goes, if I have my house paid for, I can take more risk on a business side. It give me a sense of security I need to be in the business I am in.

I think I do well for myself so I am going to stick with this philosophy.

Also, a lot of people lost sight of homes not being an investment and they are facing being on the street right now. Second home can be an investment, first home is a roof over your head.

 

[miplank]

I know what most people think and I understand the math behind that. My thinking goes, if I have my house paid for, I can take more risk on a business side. It give me a sense of security I need to be in the business I am in.

I think I do well for myself so I am going to stick with this philosophy.

Also, a lot of people lost sight of homes not being an investment and they are facing being on the street right now. Second home can be an investment, first home is a roof over your head.

I totally agree with that..Plus, if you bust your ass and pay your home off quickly. You have that much more money to play with, invest, or whatever in the fuck you want. At the end of the day your mortgage is your biggest bill at the end of the month.

I sat down and did the math and I pay $500 per month extra on my mortgage. By doing that i'll have it paid off by the time I am 40.

 

[75th]

I totally agree with that..Plus, if you bust your ass and pay your home off quickly. You have that much more money to play with, invest, or whatever in the fuck you want. At the end of the day your mortgage is your biggest bill at the end of the month.

I sat down and did the math and I pay $500 per month extra on my mortgage. By doing that i'll have it paid off by the time I am 40.

 

[miplank]

you know what I meant you cocksucker!

 

[75th]

ololloololololollo

 

[miplank]

keep laughing and i'm coming over to your house and kicking holes in you rice paper walls you asian fuck!

 

[PICK3]

how much credit do you have vs. your balances on your CC's?

I have one cc. The balance is $120, limit is $300.

olololololololololololoollolololololololololololo2

 

[miplank]

olololololololololololoollolololololololololololo2

lololololo

 

[bakemeacookie]

real estate "investing" lol. Prepare to lose your money orbs. Plenty of people thought they were part-time financial wizards and got owned - look them up.

btw: if u live in the house that you're "investing" in, it's not called an investment. It's called living in your house.

c

 

[musclemom]

Oh, a few points you may want to take into consideration:
1. Child support payments go into factoring how much mortgage you can afford.

2. If you're self employed, the mortgagor is going to want to see a solid three plus years of income, more is better.

3. Just because you buy a house doesn't automatically mean it will go up in value.

 

[RottenWillow]

I know you said you have 65k in home equity. Very few people here have a hard asset like that. They can all take about what stocks they made money on but usually leave out what ones they lost the same money on or how they pissed that money away.

Oh I wish I could take credit for that. Our house was an REO mom had that she got for something like 60% of the fmv. The place was a perfect flipper. Nice property that looked bad b/c it'd been empty for over a year. She gave us a mortgage and sold it to us for cost, so we stepped into it with buttloads of equity.

 

[-SD-]

Oh, a few points you may want to take into consideration:
1. Child support payments go into factoring how much mortgage you can afford.

2. If you're self employed, the mortgagor is going to want to see a solid three plus years of income, more is better.

3. Just because you buy a house doesn't automatically mean it will go up in value.

Once again, hopes and dreams crushed by good ol' reality.

 

[jnevin]

See above.

Down payments can no longer be gifted by a family member. It has to be yours and you need to show it sitting in the bank for a few months.

Most lenders require a minimum of a 640 fico for an FHA loan (even though there are no credit score requirements for FHA). You'll also need at least three active tradelines that have been active for at least two years.

Your income is what your adjusted gross income is on your tax returns. The lender will pull your returns.

Ejamacation has nothing to do with qualifying. Neither does criminal history.

 

[jnevin]

you can get a FHA loan for as little as 3.5% down. but that is only for people with good credit and the house you are buying has to have built in equity if that makes sense. the appraised value of the home has to be higher then what you are paying in other words. and ur interest rate wont be good

if you put 20% down with good credit they will kiss your feet. you can get a mortgage rate of 4% right now. its a steal.

You're thinking HUD homes and loans. FHA will do lower credit loans and will give rates comparible to conforming.

 

[SPEKTOR-AAA]

I hear that you have good intentiuons. This is a horrible idea for you. All the "ideas" you have a are for well established people with a lot of income and capital. You will be lucky to be in that position in 20 years led alone 6 months.

I have to disagree with you. Its a great idea for him, I do understand looking to far ahead may be his problem at the moment he probably needs to focus his attentions on the smaller goals right now to reach that. On the other hand I don' think its right to dissuade him from his thoughts.

Also, hes didn't say he was literally trying or had intentions on buying a house he was simply asking the process, can you blame him you ALL seem to know everything and he know NOTHING right??? Once again cant blame him.....

Lastly you don't NEED a lot of income to get a house. Its all relevant, 75,000 house doesn't really need a big income or the greatest credit to get approved. In these times this price range is very doable, at least in this area of California. Yes his credit will need some help but nothing a year or two of focused consistent saving and debt paying cant improve. C'mon hes not buying a mansion here folks, just something to call his own LIGHTEN UP. GRUMPY PPL

75000 house (very doable in todays market)
FHA loan (not to hard to get approved for)
3.5% down 2800.00 down payment (easy to come by)
decent credit (he can get there with effort shortly 1 year)
good job history (which he has)

 

[jnevin]

I have to disagree with you. Its a great idea for him, I do understand looking to far ahead may be his problem at the moment he probably needs to focus his attentions on the smaller goals right now to reach that. On the other hand I don' think its right to dissuade him from his thoughts.

Also, hes didn't say he was literally trying or had intentions on buying a house he was simply asking the process, can you blame him you ALL seem to know everything and he know NOTHING right??? Once again cant blame him.....

Lastly you don't NEED a lot of income to get a house. Its all relevant, 75,000 house doesn't really need a big income or the greatest credit to get approved. In these times this price range is very doable, at least in this area of California. Yes his credit will need some help but nothing a year or two of focused consistent saving and debt paying cant improve. C'mon hes not buying a mansion here folks, just something to call his own LIGHTEN UP. GRUMPY PPL

75000 house (very doable in todays market)
FHA loan (not to hard to get approved for)
3.5% down 2800.00 down payment (easy to come by)
decent credit (he can get there with effort shortly 1 year)
good job history (which he has)

His income is mostly from tips and from a small side business. I'm guessing none of either are being claimed on taxes or reflect on adjusted gross income. The money to come in to close with isn't only the down payment, but also the upfront MIP, closing costs, and escrow. And if you think someone's going to do a loan like that at par you're nuts. I'd make 4 points on a loan that small with someone with credit challenges.

 

[the.gladiator1987]

His income is mostly from tips and from a small side business. I'm guessing none of either are being claimed on taxes or reflect on adjusted gross income. The money to come in to close with isn't only the down payment, but also the upfront MIP, closing costs, and escrow. And if you think someone's going to do a loan like that at par you're nuts. I'd make 4 points on a loan that small with someone with credit challenges.

My income comes from 3 jobs, and then I also get tips, and on top of that i get my ebay money. Its not a lot, but I think in a year once i showed i make that consistently I can afford a $75,000 house.

All my tips are reported, I have to. And in a year my credit will be atleast 650 which isnt bad

 

[lartinos]

I have to disagree with you. Its a great idea for him, I do understand looking to far ahead may be his problem at the moment he probably needs to focus his attentions on the smaller goals right now to reach that. On the other hand I don' think its right to dissuade him from his thoughts.

Also, hes didn't say he was literally trying or had intentions on buying a house he was simply asking the process, can you blame him you ALL seem to know everything and he know NOTHING right??? Once again cant blame him.....

Lastly you don't NEED a lot of income to get a house. Its all relevant, 75,000 house doesn't really need a big income or the greatest credit to get approved. In these times this price range is very doable, at least in this area of California. Yes his credit will need some help but nothing a year or two of focused consistent saving and debt paying cant improve. C'mon hes not buying a mansion here folks, just something to call his own LIGHTEN UP. GRUMPY PPL

75000 house (very doable in todays market)
FHA loan (not to hard to get approved for)
3.5% down 2800.00 down payment (easy to come by)
decent credit (he can get there with effort shortly 1 year)
good job history (which he has)

I'm sorry bro, but this is a dream.

 

[75th]

My income comes from 3 jobs, and then I also get tips, and on top of that i get my ebay money. Its not a lot, but I think in a year once i showed i make that consistently I can afford a $75,000 house.

All my tips are reported, I have to. And in a year my credit will be atleast 650 which isnt bad

 

[miplank]

My income comes from 3 jobs, and then I also get tips, and on top of that i get my ebay money. Its not a lot, but I think in a year once i showed i make that consistently I can afford a $75,000 house.

All my tips are reported, I have to. And in a year my credit will be atleast 650 which isnt bad

how do you know what your score will be in 1 year?

 

[the.gladiator1987]

how do you know what your score will be in 1 year?

Im assuming it will go up to around 650 in ayear, based on:

-having an open installment open for 2 years
-2 credit cars getting used and paid off every month
-paying off a delinquent account (it will still be on my credit, but at least it will be closed)

 

[75th]

lol

 

[the.gladiator1987]

fuk u 75th ur posts are so unproductive, theyre all jus gettin ur post count up and half of them are lol or ololllooloooloollool

i dont understand why ur always jus bein a dick lol got nothin better to do than to troll around in my threads its cool bro keep doin it i like the popularity especially from members with such a high post count like you

 

[miplank]

Im assuming it will go up to around 650 in ayear, based on:

-having an open installment open for 2 years
-2 credit cars getting used and paid off every month
-paying off a delinquent account (it will still be on my credit, but at least it will be closed)

is it going to take you two years to pay off that $437 geo metro?

 

[the.gladiator1987]

is it going to take you two years to pay off that $437 geo metro?

huh? im actually selling it this weekend and upgrading to a 98 dodge avenger lol

In a year I will have 1/3 my debt paid off, good credit for a year straight, and money saved up in the bank

 

[miplank]

huh? im actually selling it this weekend and upgrading to a 98 dodge avenger lol

In a year I will have 1/3 my debt paid off, good credit for a year straight, and money saved up in the bank

I wouldn't call that an upgrade...


so what installment loan do you have that'll you will be paying on for two years?

 

[the.gladiator1987]

I wouldn't call that an upgrade...


so what installment loan do you have that'll you will be paying on for two years?

It has half the miles and it is registered and smogged. Im gonna drive the avenger for a year if I can, then I can hopefully get financed for a car with a lower interest rate...hopefully. I can def get financed but it might be a high interest rate

I have a $5,500 school loan I got last year, it is deferred though so I dont have to pay on it until I graduate. I didnt think itd help my credit but on my credit report it shows OK for my payments, even though i havent been making any.

 

[miplank]

It has half the miles and it is registered and smogged. Im gonna drive the avenger for a year if I can, then I can hopefully get financed for a car with a lower interest rate...hopefully. I can def get financed but it might be a high interest rate

I have a $5,500 school loan I got last year, it is deferred though so I dont have to pay on it until I graduate. I didnt think itd help my credit but on my credit report it shows OK for my payments, even though i havent been making any.

your student loan is a false positive on your bureau. It will inflate your score while it's deffered, but lenders won't consider it until you've started making the payments on it.

 

[75th]

fuk u 75th ur posts are so unproductive, theyre all jus gettin ur post count up and half of them are lol or ololllooloooloollool

i dont understand why ur always jus bein a dick lol got nothin better to do than to troll around in my threads its cool bro keep doin it i like the popularity especially from members with such a high post count like you

lol @ you labeling others as unproductive.

 

[the.gladiator1987]

your student loan is a false positive on your bureau. It will inflate your score while it's deffered, but lenders won't consider it until you've started making the payments on it.

Ahh that makes sense. Would it help if I start paying on it even though I dont have to yet?

 

[musclemom]

My income comes from 3 jobs, and then I also get tips, and on top of that i get my ebay money. Its not a lot, but I think in a year once i showed i make that consistently I can afford a $75,000 house.

All my tips are reported, I have to. And in a year my credit will be atleast 650 which isnt bad

I actually bought a house, FHA, as a self employed person 20 years ago (back then I was self employed cleaning offices).

I'm telling you, the credit score is probably the least of your problems. Being self employed, it's proof of income that'll nail your ass, you need THREE YEARS or they won't take you seriously.

 

[the.gladiator1987]

I actually bought a house, FHA, as a self employed person 20 years ago (back then I was self employed cleaning offices).

I'm telling you, the credit score is probably the least of your problems. Being self employed, it's proof of income that'll nail your ass, you need THREE YEARS or they won't take you seriously.

I've been employed for almost 3 years, but i havent made a lot of money every month. Im starting to make more though, doesnt it help that Ive had a job pretty consisently for almost 3 years?

 

[calveless wonder]

why is anyone actually giving him real advice?

you guys are retarded

 

[billfred]

I actually bought a house, FHA, as a self employed person 20 years ago (back then I was self employed cleaning offices).

I'm telling you, the credit score is probably the least of your problems. Being self employed, it's proof of income that'll nail your ass, you need THREE YEARS or they won't take you seriously.

I can relate that to current times. I am currently not drawing any salary. My wife's sister is in major trouble so we are going to co-sign a note for her to get a different house (they are walking from existing one)and yes I realize I am going to take it in the arse here. So we go to get the loan which is probably 2% of my liquid asset value, turned down. Sweet!!

Told us to come back when I have a regular salary. LOL. She is in a rent house now - sucks for her.

 

[miplank]

I can relate that to current times. I am currently not drawing any salary. My wife's sister is in major trouble so we are going to co-sign a note for her to get a different house (they are walking from existing one)and yes I realize I am going to take it in the arse here. So we go to get the loan which is probably 2% of my liquid asset value, turned down. Sweet!!

Told us to come back when I have a regular salary. LOL. She is in a rent house now - sucks for her.

lucky for you

 

[75th]

why is anyone actually giving him real advice?

you guys are retarded

This x infinity.

 

[calveless wonder]

you should buy timeshares bro, great investment

 

[musclemom]

I've been employed for almost 3 years, but i havent made a lot of money every month. Im starting to make more though, doesnt it help that Ive had a job pretty consisently for almost 3 years?

I'm going to answer you straight knowing you're probably trolling: They look at your yearly income, the actual stuff you declare to the IRS. If your annual income, each year, for the past three years, isn't about 1/3 (I think, mortgage people correct me) of what you want to mortgage, then give up and move on.

IOW, if you haven't made, AND DECLARED WITH THE IRS, minimum of income of $24,000 per year in 07/08 and 09, you better forget a $75,000 house. What you REALLY made, if you haven't filed it, doesn't mean crap. Potential income, doesn't mean crap.

This is how mortgages for beginners work: They take your debt and add it. They take your income and add it up. They subtract the money you have to put down from the sale price of the house. If, after you pay your other debts, you have 27% of your income you get a mortgage.

Frankly, you're crazy if you don't get a prequalified mortgage before you even think about buying a house.

That said, I'm out of here.

 

[SPEKTOR-AAA]

I'm sorry bro, but this is a dream.

Yeah Ive heard that my whole life....I call B/S