Buying a house from a parent? - Page 2 - PeachParts Mercedes-Benz Forum

TylerH860 · #16 09-18-2011, 10:05 PM

Quote:

Originally Posted by Palangi

There is some truth to that during "normal" economic times, but I am sure happy to not owe on a mortgage nowadays.

Will we ever go back to normal or will there be a new normal? It seems like the unsustainable pattern is finally getting unsustainable.

tbomachines · #17 09-18-2011, 10:06 PM

Quote:

Originally Posted by TylerH860

Yup, sure thought I was saving money by buying a house vs. renting. 120k Mortgage ($600 minimum but I pay $750 to pay off faster) + Taxes on 170k value ($250) + Specials ($100) + HOA ($30) + Utilities ($400) + Upkeep ($200). Total is $1730. 2 roommates cover less than half.

I could have lived in the Penthouse floors of my first place, a high rise apartment with no maintenance, pool, hot tub, gym, driving range, basketball court, unlimited secured enclosed parking, ballroom for rent, and close to everything for $1100 plus about $300 for utilities. Normal apartment was $650 a month.
http://250douglasplace.com/

Plus I'd be all by myself, and wouldn't be suffering with a 2 car garage.

Wow that penthouse would go beyond twice that in my area

spdrun · #18 09-18-2011, 10:09 PM

Quote:

Originally Posted by Palangi

There is some truth to that during "normal" economic times, but I am sure happy to not owe on a mortgage nowadays.

Actually, with tight lending standards these days, cash in the bank/a business/rental investments/etc becomes even more important than before, since it's harder to pull cash out of a paid-off house than before.

Palangi · #19 09-18-2011, 10:24 PM

Quote:

Originally Posted by TylerH860

Will we ever go back to normal or will there be a new normal? It seems like the unsustainable pattern is finally getting unsustainable.

If I could look into the future and know the answer to that one, I would be rich.

Of course, if I was rich, 0bama would be trying to make me poor......

Of course, 0bama looks to be "shovel ready" in the next election.....

On the other hand, the opposition could still nominate another dinasoar and thus defeat themselves.....

So, the economic uncertanty continues.....

Bottom line is, the economy will not get better until the uncertanty goes away, and that will not happen until 0bama and his gang of Bolshiveks are gone.

TylerH860 · #20 09-18-2011, 10:29 PM

Let's not get completely derailed here. The OP asked nothing about politics.

I'd suggest starting a new thread if you want to go on this tangent.

Palangi · #21 09-18-2011, 10:35 PM

Quote:

Originally Posted by TylerH860

Let's not get completely derailed here. The OP asked nothing about politics.

I'd suggest starting a new thread if you want to go on this tangent.

OK

Just answering your question .........

Graplr · #22 09-18-2011, 10:36 PM

Quote:

Originally Posted by spdrun

Actually, with tight lending standards these days, cash in the bank/a business/rental investments/etc becomes even more important than before, since it's harder to pull cash out of a paid-off house than before.

Yes, but think of all the cash you could put in the bank if you had no mortgage payment every month. Simply pay yourself instead of paying the bank. Sounds like a good way to go to me!

Graplr · #23 09-18-2011, 10:40 PM

Quote:

Originally Posted by Nate

Well, its about that time, and I'm scared to death.

I'm in a situation where the best option includes me buying my mothers house.
We have not talked to a real-estate agent yet, but I was wondering if there was any knowledge on the forum side of the world that could help me out.

How big of a legal can of worms does it open up to buy a house from your parent?

Are there any loopholes that this situation falls through. Some situations with this for vehicles are a tax free transfer, but I'm guessing a home buy is a different ball of wax.

Bit scary for a 21 year old, I can do anything, but boy is this spooky. I've never spent more then $2000 on any one thing in my life at this point. Spending 150ishk is astounding.
Little help?

~Nate

Nate,
You have not stated WHY this is the best option. What are the goals here?

Does your mom need to sell her house? Is this the reason?

spdrun · #24 09-18-2011, 10:45 PM

Quote:

Originally Posted by Graplr

Yes, but think of all the cash you could put in the bank if you had no mortgage payment every month. Simply pay yourself instead of paying the bank. Sounds like a good way to go to me!

There's also "opportunity cost" involved if you feel that there are good opportunities now, rather than 20 years from now.

TylerH860 · #25 09-18-2011, 10:57 PM

Quote:

Originally Posted by spdrun

There's also "opportunity cost" involved if you feel that there are good opportunities now, rather than 20 years from now.

I don't think I'll be getting above my 4.99 fixed in any return for a while. I was extremely fortunate that I chose to take 30k out of my MS investment account for a down payment in March 2008.

Graplr · #26 09-18-2011, 11:28 PM

Quote:

Originally Posted by spdrun

There's also "opportunity cost" involved if you feel that there are good opportunities now, rather than 20 years from now.

I'm not following you. I'm assuming you are implying that you could make money on borrowing money against your house. Of course you could do that but that is not the point. You stated that now it is important to have cash on hand. If one had no mortgage payment it would be easier to accumulate more cash than if one did have a mortgage payment.

spdrun · #27 09-18-2011, 11:30 PM

Quote:

Originally Posted by Graplr

I'm not following you. I'm assuming you are implying that you could make money on borrowing money against your house. Of course you could do that but that is not the point. You stated that now it is important to have cash on hand. If one had no mortgage payment it would be easier to accumulate more cash than if one did have a mortgage payment.

Mortgage payment is say 6% of the original principal (interest + principal paydown). If you can invest the cash at 8%, why wouldn't you?

Graplr · #28 09-18-2011, 11:34 PM

Quote:

Originally Posted by spdrun

Mortgage payment is say 6% of the original principal (interest + principal paydown). If you can invest the cash at 8%, why wouldn't you?

Is there any risk involved or am I guaranteed 8% return on my money?

Again, this is besides the point you brought up. You stated it was important to have cash. It would be very easy to have more cash if one had no mortgage payment.

Emmerich · #29 09-18-2011, 11:48 PM

Once you get a mortgage, life changes. Now you need your job more than your job needs you.

spdrun · #30 09-19-2011, 12:02 AM

Quote:

Originally Posted by Emmerich

Once you get a mortgage, life changes. Now you need your job more than your job needs you.

Not really, I could walk away from my place, rent it out (last time I decided to do that and travel for a month and a half, people were literally crawling up my arse and calling at 1 am to see the apartment. Highly amusing.), break even or have a few extra cents, and rent something in another city. I'm not locked in to a job or my business because of it.

If you can't buy so that you pay the same or less than renting at market rate, what's the point of buying? Either talk the price down (probably not an option with family) or walk and find a deal that doesn't blow goats.

Deals where you know inside info that would raise prices locally excepted, of course.