Here’s my answer to that question just asked on Quora
Owning your house is the biggest and best benefit. It means you can paint the bathroom whatever color you want, remodel the kitchen, plant what you want in the yard, and on and on…all for your personal comfort and enjoyment.
If you have a mortgage, the interest you are paying is tax deductible (and for about the first 15 years of a typical 30-year mortgage your payment is more than half interest if you don’t pay taxes and insurance from the same payment. And the property taxes are probably deductible whether you paid with your mortgage payment or separately. No part of rent payments are deductible.
Besides that, owning a home has been a good investment over a long period of time. Yes, there are times when the value of a home may go down, but you only “lose money” if you see during one of those times. In 1950 the median (half were more, half were less) home price in the U.S. was $7,354. By 2000 it was $119,600 and today is $236,400. But be careful here, that 1950 house was less than 1,000 square feet with two bedrooms and one bath. Today it’s just short of 2,500 square feet and the majority have at least four bedrooms and three baths.
Nevertheless, buying a home (and living in it) has almost always been a good investment. One way to lose money on a house is to sell it one or two years after you buy it. If you’re likely to live there for at least two years, my advice is rent.
With mortgages, there is no “one-size fits all”. Mortgages (and the rates) vary according to your personal situation: income, debts, down payment, credit score and so many more items. Your best source for mortgage information is a local, experienced, mortgage broker. If you don’t know one, contact me for an introduction to my preferred lender.
Fannie Mae, which indirectly finances the fast majority of mortgages in the US, recently did a study on the most influential sources of mortgage information. Here’s what they found
This shows we have a lot of smart people in this country. Almost one third relied on a mortgage lender. Slightly fewer named their Realtor. Before I get too flattered with that, a Realtor is not the best source of mortgage information. If you ask me about mortgages I’ll tell you exactly that and introduce you to my preferred lender, who is a mortgage broker. Next most often used, family and friends, may be a good source if they’ve recently financed a home purchase (but the best mortgage for you is almost certainly not the same as the mortgage your family or friend got). The best source remains a mortgage broker. The reason is that mortgages are so varied and complex (and changing) today that you have to be in the business every day to have good, up to date, knowledge of what’s available that best matches for a particular borrower. A mortgage broker has access to dozens of mortgage sources and probably works with 8-10 on a daily basis. They are the best place to find the best mortgage for you.
We continue to buy ever larger homes, now average 2700 SqFt (up 1,000 from 1973). 41% of renters wish they’d bought. Full details here.
I just learned of a new down payment match offer from Guild Mortgage, the largest local mortgage lender in the NW. It’s really simple: you put up 1% of the purchase price of a home and Guild makes a grant of 2% so you qualify for a conventional 3% down payment mortgage. Yes, you just tripled your money. You can buy a $350,000 home with only $3,500 of your money down (plus closing costs). You could buy a nice $100,000 condo with $1,000 down. There’s even more good news in the fine print in the detail flyer my preferred lender, Kelly Parkman at Guild, gave me today
And here’s a short video of Kelly himself explaining it. We’ve worked together for five years and I’ve never seen him so excited.
Contact Kelly at 503/528-9800 or KParkman@GuildMortgage.net or contact me and I’ll help, too
ALL lenders have the right to do a second credit check (and confirm employment, etc) just before funding. If you buy the new car after approval (or run up your credit card balance, or anything else that raises your monthly payments) you have changed your debt to income ratio. An acceptable ratio was one of the factors in the approval for your mortgage and if you change it by adding debt you may put yourself above the lender's limit and nullify your mortgage approval.
The safest course is to NOT take on ANY new debt after approval but before closing. Don't buy a car, a timeshare or anything that would affect your debt to income ratio. You've waited this long, stifle the urge buy whatever it is for another few days. After closing, you're on your own, but don't risk your purchase by buying something now.
Any good lender will tell you the same (but you may not have been listening). If you'd like an introduction to a top-drawer lender who's been delighting my clients for years, let me know.
At a Windermere meeting last week we heard Windermere's Chief Economist.
Here's the takeaway in plain English: http://www.bizjournals.com/portland/blog/real-estate-daily/2016/02/is-the-economy-going-to-be-better-this-year-brian.html
Thanks to our friends at Penrith Mortgage:
PROPERTY TAX BILLS ARE COMING, PLEASE REMEMBER:
If the statement is green, the county thinks you are paying the bill.
If the statement is yellow, the county thinks your lender is paying the bill and they have sent the bill to them; no further action is needed.
Did you get a green statement when you should have gotten a yellow statement?
Not to worry… simply call your Mortgage Consultant or Lender and they will walk you through what to do.
If you got the green statement, notice that if you pay in full by November 15th, you will sa
Most home buyers need to transfer money to the escrow company to complete the down payment the day before closing. The common way to do that is with a "wire transfer" – an electronic transfer from the buyer's bank to the escrow company.
The escrow company will send "wire transfer instructions" to the buyer to send to their bank well in advance of the transaction. The instructions consist of routing and transit numbers, account numbers and lots of other numbers and information to be sure the money gets to the right account at the escrow company.
The fraud begins when the escrow company sends an email to the buyer with new wire transfer instructions, except it's not really from the escrow company (even though it looks like it is). The email has actually comes from a criminal who has hacked the buyer's email account. If the buyer gives their bank the "new" instructions, the money is transferred to the hacker's account, usually in a foreign country and impossible to recover. .
Escrow companies almost never change wire transfer instructions. If you received such a communication, call your escrow officer directly.
I often hear people say they'd like to buy a house,"but everything's so expensive now." It's true that median sale prices of detached homes in Portland are around $300,000, but there are plenty of nice homes for less, sometimes a lot less.
Yesterday a friend was amazed at a listing I showed him for a very nice 1120 SqFt 2-BR condo – $150,000. It had granite & stainless upgraded kitchen & bath, two decks and is in a very attractive neighborhood. My penciling some numbers showed you could probably buy this home for mortgage payments of less than $1400, and if you didn't have a lot of other debt (like huge car payments or whopping credit card bills) you would likely qualify if you made about $55,000.
So don't let the "everything's so expensive now" trap keep you from buying now. The place to start is with a good lender, and I'd be happy to introduce to a great one.