Those of you who BOUGHT your own place - Regret it?

[In~Plain~Site]

My old room mate got screwed on his mortgage. He has payed over $150k so far and hasn't paid shit on his principal. Bank Of America won't work with him on bringing his monthly payment down either. He bought the house for $420k and now it is worth about $150k. He has been paying anywhere from $2800-$3200 a month for years. Fuck the banks!

Has to be Cali or Nevada...curious as to what his current LTV might be.

BofA is one of the worst culprits out there, notorious for not reworking loans down to current interest rates.The benefit of having a current lender do the modification is that you avoid unnecessary fees.

If your friend is still credit-worthy and can verify some income, I know of several GREAT institutions that would treat him as a person.

Nothing motivates current lenders like an LOI in hand.
If he could produce an LOI(letter of intent) from another bank, meaning they intend to refi his home @ X%, BofA should play along.

If you have a 30 year fixed mortgage loan and paid monthly..and also made that 13th payment to the principle every year...you will pay off that loan in 15 years.

that 13th payment will get you out from under the loan sooner, but it won't take 15 tears off. i would love it if it did!

I was just about to add that.

A seperate check with your final mortgage payment for the year, will knock seven years off of a 30-year fixed and LOTS of interest.

Make sure the check is identified as Apply Directly to Principal.

Also, request an amortization schedule at least every other year if they don't send you one with your annual interest paid statements.

 

[Tonatiuh]

i havnt rented since i was 19 yrs old,ive had a few houses thru the years and i havnt regretted owning any of them...all ur doing right now is paying someone elses house note so they can own their house.when you own you have property to work with,and you will enjoy the work you put into ur house to make it how you want it....the money is like an investment,all your doing is adding value to your own home....and money in ur pocket when you want to sell and upgrade....i gotta say,ur friend is not giving you good advice,just wondering what his living situation is?....does he rent?has he ever owned?or does he just live w his gf or mommy?...because that is the "youngest minded" advice he could have gave you....did you know that when u own,its all yours?
peace-T-

 

[pftek]

i havnt rented since i was 19 yrs old,ive had a few houses thru the years and i havnt regretted owning any of them...all ur doing right now is paying someone elses house note so they can own their house.when you own you have property to work with,and you will enjoy the work you put into ur house to make it how you want it....the money is like an investment,all your doing is adding value to your own home....and money in ur pocket when you want to sell and upgrade....i gotta say,ur friend is not giving you good advice,just wondering what his living situation is?....does he rent?has he ever owned?or does he just live w his gf or mommy?...because that is the "youngest minded" advice he could have gave you....did you know that when u own,its all yours?
peace-T-

Yeah he actually owned 2 homes. Rented them and he flipped them both.

He's trying to convince me that instead of buying a place to rent and take the down payment and repair costs and invest in another business.

 

[SpasticGramps]

I was just about to add that.

A seperate check with your final mortgage payment for the year, will knock seven years off of a 30-year fixed and LOTS of interest.

Make sure the check is identified as Apply Directly to Principal.

Also, request an amortization schedule at least every other year if they don't send you one with your annual interest paid statements.

Very Important

 

[Weed-Luver]

I say buy. There are pros and cons though as stated above.

If you do buy, make sure it's something you'll want to stay in for a while and don't look at it as an investment. Houses were never supposed to be "investments" whose value always went up. They are places to live. Housing prices are have a long way to go before they bottom IMO. If you buy it expect to lose value from the get go. The Housing Double Dip is officially under way. But interest rates are only going to go up too. I think it's safe to say we've bottomed on the interest rates.

Don't get a floating rate (adjustable ARM). 30 year fixed IMO. I wouldn't dump a lot of equity in it to try and pay it off early. You'll get better return investing the money elsewhere. Hell even your 0.1% Bank Savings Account would probably be better.

It's a big decision. I can tell you that I'll never rent again. It's more work, but it's yours and that means a lot.

screw the housing bubble..i bought my main house at the beginning of it and got a steal..just be smart when you buy and
don't be afraid to give them a low bid especially if the house is close to default..
seriously if you wanna grow, never worry bout being kicked out, assuming you pay it off, of course, grow a garden w/e.. its worth it..to me it's security and peace of mind knowing when i get home i can do anything at either place in my own style..sponge bob boxers .woo-hoo....so think about this, my house is paid off so my bills are 550.00 a month same as rent but no bs..that's
150.00 a month taxes & ins, sat tv 100.00, internet & phone 100.00 and about an average power bill of 200.00.. i run 1 1000w and 1 HO 4x8 4 tube fluro..look at it as not so much a cash investment but more as an investment if your self..
peace WL

 

[PhatPhreddy420]

Buy land, they're not making it anymore.

 

[In~Plain~Site]

Balls to the wind

Balls to the wind

sponge bob boxers .woo-hoo....peace WL

You are entirely overdressed friend

Buy land, they're not making it anymore.

Great advice, seriously, for those that are slightly more savvy then your average buyer and know how to identify potential roadblocks of future improvements.It's always a more valuable investment, rather than just 'hunting' property.

 

[GanjaPharma]

if you read between the lines of the pro "buy a house" stories, the message is obvious:
buy super cheap now,
or (better idea)
go back in time and buy a house before the magical reverse super duper secret triple redundant mortgage magic took hold (the 80's seems like a good time to travel to for real estate) just make sure to sell before the crash happens in '09.

up here in the PNW, for the home i live in, I pay at least $700/month MORE for my mortgage (bought in 2007 *ouch) than i would pay if i were renting. big #'s in my own home is scary to me these days . it takes me 3-4 months of "interviewing landlords" to find a good rent house for my purposes.

 

[Pointswest]

Best investment I have ever made, made my retirement possible without living in poverty. Nothing is as good as home ownership for getting your money's worth.

 

[Julian]

And such (all posts) the question of whether to rent or buy, as, for the most part, almost every post does hold valid concerns/issues...

Your initial 10-12 years are indeed interest for the most part...(But,as such, usable, whereas rent is not...ie: interest deductions)

One can also pre-pay, effectively reducing the rate by however much one chooses to pre-pay. (whether a certain amount monthly, or, payment at end of year, but always easier to throw a little extra every month...)

Seizure/risk a valid issue when operation(s) of any kind present, but, equity does also determine seizure risk...(They very well may not move forward on a property with only 5% equity......)

Depending on condition of property at time of purchase, repairs may very well be needed in future, and of varying costs, but can be somewhat controlled by knowing condition when one gets into property, (and focusing on the majors as compared to minor issues....ie: Roof vs. water heater and such....)

In this game.....there are also factors which a price tag cannot be placed upon....ie: Control of property, privacy and security issues, and so on.....

(Yes, the initial decade of ownership is actually more costly to a degree than renting in many cases (Principal not reduced, plus the added expense of any maintenance/improvements. Note "maintenance" addressed. Most speak of repairs, when the simple ongoing costs of maintenance can also add up to quite a bit annually)....but, as above, one is now in control of a property with dramatically increased security and privacy for whatever endeavors they wish to conduct .....

Is this "the best" time to buy?. This cannot be stated with total certainty, but, as one extremely well versed on properties over the last 20 years, values are certainly extremely attractive in many cases . Extremely. One can find, depending on property/area, things which at one time could have been approaching $1MM for as little as a 3rd....

Financing?, well, there have indeed been many changes in last 3 years, but, one can still go FHA which allows less than perfect credit (maybe an LOE here and there required), and end up with an initial 3% down to secure.

Note: Returns are frequently misunderstood regarding property. You have appreciation vs. down to secure, but then also have annual total of payments, but then interest write off's, and then maintenance/repairs, if any required.

But, let's for a moment, address the true picture of such: ...
Op turns property into an income producing property. Flip it and you just doubled your effective draw. (Realistically, in many cases, even a 1k flipped (2k flower) just covered your annual costs and then some in many cases. (Some cases not, depending on region/market).

The true issues for renters is not understanding the true cost of ownership...ie: Much more than mortgage payment....taxes...insurance...maintenance/repairs/improvements....which few seem to calculate in initially.......assuming,lets say, 24k a yr. in payments, when in the end, could very well end up 30k+, etc.....

On a different note, I do also think that there is a segment of population (younger) which fail to realize that the current situation is quite beneficial....(I remember rates 10%+...and so on......)

Good values, low rates, option to pre pay to further reduce rate....and so on......

Securing land is nice, (as is commercial), but one should be advised such becomes a different ballgame regarding financing....(greater down, and with commercial different approach to calculating ratios, and so on......), and if not a current homeowner, primary residence (even smaller) should be first step...

The caution would be to think through long term regarding your level of commitment....(ie: Situation may change (job)....if an op, may have to be taken down for a period (cannot be relied upon, and never should be)....In future, principal can be rented and another secured, and so on.......

Worthy of note also if one should always seek to retain their reserves, and go minimal down.

 

[HempKat]

Whenever guys like hempkat suggest that rentals might be better for growers, I'm reminded just how small my testicles are compared to a lot of you dudes.

Literally the only reason I bought a house was to improve my mental health as a grower. We play a dangerous game. Think of all the shit that could go wrong and land us in prison. The prospect of some asshole rolling up essentially whenever he pleases- and don't kid yourself with the 24 hour stuff, if landlord wants in he's getting in, immediately- is enough to give me heart failure. Especially in any state not named CA.

I was just wayyyyy to paranoid as a renter. When I got my home I had two bedrooms blown up and danced around light as a feather, not a care in the world.

That's not what I said, what I said was if your concern was to have an indoor grow for as cheap as possible then renting might be the way to go. That however is not the kind of growing I endorse as it is very risky and even if successful is partially why lovers of marijuana have a bad rep (trashing a rental property for a grow or two and then skipping out on the lease). I know people do those things so I'll not pretend they don't exist in a discussion like this.

For me personally though, if I didn't own, I wouldn't be growing indoors. Although if you do it smart a rental can be just as safe. Keep in mind though when I say rental I don't mean an apartment in the middle of the city. I mean a house in a suburb or even in the sticks, preferably with an out of state landlord.

 

[HempKat]

Yeah he actually owned 2 homes. Rented them and he flipped them both.

He's trying to convince me that instead of buying a place to rent and take the down payment and repair costs and invest in another business.

Ah well there you go, he has a self interest motivating his advice, he's not really telling you what's best for you because what if this other business investment fails? Then you're out what you would have put into the home for downpayment and repairs as well as however much rent you paid up to that point. The bottomline on how solid his advice is would depend on how good of an investment this other business would be.

 

[supermanlives]

i got in when things were cheap 11 years ago or so. i would never go back to renting

 

[chargers123]

if you get caught growing in your house and you don't have any other type of job (possibly lose job) or fat stack of cash buried then you are going to lose your house anyways because you cant make payments.. especially if you go to jail. then you will have no credit and wont be able to buy a house for long time. Also you just lost your down payment that went into your home, that could go to lawyers; and the first 10 years that you were paying.. out the window

even if you don't go to jail you have to be prepared to make those mortgage payments, lawyer fees, etc,if somethin goes down.. or you gonna have to move back in with your mom or whoever while you pay your lawyer but lose the home because you cant afford it.

and whoever said you can grow as much as you want in your house... yeah you try that and see what happens. (maybe in a med state but still got limits)

everyone has valid points here. In my opinion i think it's a goal or a desire for a lot of people to tell others that you 'own your own home' and the satisfaction/pride you get from thinking something is yours. After all it seems to be the American dream. Wife, house, kids, car...

more to life than saying you own something just because you feel good about it. A home doesn't make you who you are in life, nor does a car. And after all, in our line of work or hobby, you really don't own the home, the bank does. Because as growers, we know it's wise to not pay the home off so the cops don't take it... but like i said, the bank can take it so you better be prepared if shit goes down. That little grow in the closet wont help you now or never... and if you lose your name-tag-wearin job at pepsi or coke well.....

 

[HempKat]

That little grow in the closet wont help you now or never... and if you lose your name-tag-wearin job at pepsi or coke well.....

Not entirely true. That little grow in the closet should keep you from spending quite a bit of money on the street dealing with questionable people in questionable places. Also if it is truely just a little grow in the closet and you follow solid security measures your risk of getting busted should be virtually non existent. I've yet to hear of a bust that happened to someone who was totally careful and followed all recommended security measures. Invaribly they didn't secure and control odor, they stole electricity or they let someone know they grow or they sold out of where they grow.

Still your point of having a safety net of cash somewhere the law can't seize is a good one.

 

[chargers123]

i understand, keepin it small can be an advantage there. your risks are decreased a lot that way. If it's solely for personal use then just be extra careful and know your limits. Even sharing your best dope in the state with friends can be risky though. Robberies can happen and cops come and want to check every room.

always have extra cash for lawyers and payments though, especially if you're a commercial grower. But that isn't wise thing to do in my life.. maybe others.

 

[ElGato]

dont know if anyone mentioned this....

but many thousands of people who bought homes from 2002-2007ish now owe much much more than their homes are valued at, and in retrospect they would have been better off renting

there are good points and bad with buying or renting, only the individual can decide for themselves which is the right option for them

in my area housing prices have fallen 20-30% or more ....the housing bust has many rethinking their options



mj

 

[mean mr.mustard]

pftek start another thread entitled Who's rented for over ten years - Regret it?

And make it a poll.

 

[RetroGrow]

Well, if you lost a couple hundred thousand due to market collapse, you might know the answer to that question. My place was appreciating $30,000 per year, and I thought, "cool!", until it collapsed virtually overnight. Kind of leaves a bad taste in your mouth. I would not buy another place now, unless I could afford Hawaii. Plus feds can seize your place if you are growing there.....

 

[mean mr.mustard]

After a while you'd have to wonder where your money is going.