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Arzakon posted:Yeah it isn't a case of the appraisal being too low, its that they don't believe the appraisal is valid. Did they offer you any sort of option to get a second appraisal? Do you have an option of using another lender? It's being re-comped last I was told.
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Jul 29, 2010 18:17
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The bank didn't think the comps were comparable. I had the same problem with my house a couple of years ago, the comps said it was worth 400k and I was paying 220K. The bank had a fit. Come to find out it was really worth 220k, heh.
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Jul 29, 2010 22:06
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Am I reading this right in that negotiating a good price can cause problems with your lender?
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Jul 29, 2010 22:24
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Sock on a Fish posted:Am I reading this right in that negotiating a good price can cause problems with your lender? Bizarre, yeah. But I think it's more a case of, having no good comps in the area can lead your lender to doubt the appraisal, regardless of the actual result.
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Jul 29, 2010 23:05
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I had a nice talk with the broker today. The reason the appraisal kicked back was because it's a rural area near a medium metropolitan area and they didn't like having comps 5 miles away. Once that was documented, everything's fine. Should go to underwriting in the next day or two.
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Jul 30, 2010 19:40
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Oh goody, the place I've been looking at just became bank-owned! I've been looking for a decent place for about a year and I'm starting to give up on the search, all the decent buys are getting foreclosed on and the amount of morons in the RE industry I'm encountering are terrifying.
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Aug 3, 2010 08:40
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We had an offer on a shortsale for 3 months that the bank never answered. Then we found the place we're about to buy
Farking Bastage fucked around with this message at 02:48 on Aug 4, 2010 |
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Aug 4, 2010 02:21
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This is where it's getting stressful  The "the underwriter wants this, the underwriter wants that" phase. Good news is we just sent him the bank statement showing that we have the necessary funds for the down payment et all in our savings account + the paper trail to document where the money came from. I swear I may spend an entire week drunk once this closes.
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Aug 5, 2010 14:46
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Here's my situation: I sold my old house and used all the profits to pay off old debt. I have about 30K in a retirement account from my old job. I'm currently paying a tremendous amount in child support. This will be cut in half in 2 years when my son turns 18. Is an interest only option viable for me knowing that I will have approximately $1000 more per month to spend in 24 months? My credit is around 705, my wifes is a bit higher than that. She doesn't work. E: One of the houses we're looking at is priced about $100,000 under assessed value, so I'd like to jump into that while the market is crap. Phummus fucked around with this message at 15:27 on Aug 5, 2010 |
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Aug 5, 2010 15:05
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Have you consulted with a CPA to be sure of your tax situation? I would hope so, but its worth asking. I understand (very very well) the temptation to jump on a house now, while it seems prices might be hitting an all-time low, but it seems to me you'd be much better off waiting for two years. Even if house prices climb from now to then, they won't climb by all that much, and your income will be secure. You'll be able to get a fixed rate and you won't have banks possibly rejecting you because of that huge child support burden. I realize adjustable rate mortgages can make sense for certain people, but it's important to recognize that even if you're one of those people, they're still a riskier proposition. You are trading low initial payments for a higher risk of being financially hosed and losing your house (if, say, you lost your job in two years, or your income changed, or your wife got pregnant). Ultimately I don't know if we have enough information to give you a good answer. How much is the house? How much money do you make? How old are you? Have you gotten pre-qualified to see how much you can borrow, and what rates you'd get on a fixed vs. what your costs would be on an interest-only? Edit: oh yeah, Phummus posted:E: One of the houses we're looking at is priced about $100,000 under assessed value, so I'd like to jump into that while the market is crap. Don't be fooled. Some sellers (especially banks) put up silly-low asking prices to stimulate interest and bids. Market price is what a house sells for, not what the sellers are asking.
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Aug 5, 2010 19:02
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Phummus posted:Here's my situation: NO. Do not buy a house with expectation that you'll be able to afford it in the future. Only bad things lie down this path.
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Aug 5, 2010 19:51
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Leperflesh posted:Have you consulted with a CPA to be sure of your tax situation? I would hope so, but its worth asking. The house is listed at $250k. I looked up the tax assessments at the courthouse. Its assessed at $365k. I'm 40. I make just into the six figures range. I'm in the pre-qualification process now. My job is very secure. We've grown, even through the recession, all my performance reviews are top notch. The change in my income in 2 years will amount to approximately $1000/month. I know it may seem foolish to jump now, but I also don't know how much longer we can have 4 (and sometimes 6) people in a 900 sq ft apartment with 1 bathroom and 2 bedrooms. Its pretty cramped. On that side of things, my rent right now is $865.
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Aug 5, 2010 19:52
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Phummus posted:but I also don't know how much longer we can have 4 (and sometimes 6) people in a 900 sq ft apartment with 1 bathroom and 2 bedrooms. Its pretty cramped. On that side of things, my rent right now is $865. Where are you getting the money for the down payment here?
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Aug 5, 2010 19:57
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gvibes posted:Where are you getting the money for the down payment here? Proceeds from selling my former abode.
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Aug 5, 2010 20:03
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Phummus posted:Proceeds from selling my former abode. quote:used all the profits to pay off old debt. Personally, I think it's a bad time to buy, regardless of financial situation. Tax assessments are meaningless. Inventories are massive. No one has jobs to afford to buy, stifling demand. Rent. Save. By later. You'll be better off in the long run. JMO.
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Aug 5, 2010 20:54
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gvibes posted:Ah. From this: It might be a bad time to buy for him, but otherwise your description makes it sounds like an incredible time to buy. Why do massive inventories and low demand make it a bad time to buy???
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Aug 5, 2010 21:03
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Seventyfour posted:It might be a bad time to buy for him, but otherwise your description makes it sounds like an incredible time to buy. Why do massive inventories and low demand make it a bad time to buy???
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Aug 5, 2010 21:08
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Ah, ok, I see where you're coming from. Thanks.
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Aug 5, 2010 21:09
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What prices will do in the future is, in my opinion, heavily dependent on localized markets. Prices are rebounding in some markets while still falling in others, right now. There is a risk that prices will drop some more, in any market. That exact risk is incalculable, but some educated guesses can be made. Assessed value for local taxes is usually based on whatever the house sold for last, often with some adjustments and math thrown in. They are, as gvibes said, meaningless when figuring out present market value. The best way to assess present value is to look at the final sale price for recent comparable homes in the same area. For comparison: prior to buying my house in December, my county had assessed it for nearly $400,000. I bought it for $240,800. I paid market price, or possibly slightly above (for condition reasons). By no stretch of the imagination was this house worth over $300k; if it had been priced at $300k, it would not have sold, period. If you wait two years, save some money, and buy your house with 20% down, even if your fixed rate is 6.5% (because we are assuming rising interest rates) and the house goes up by 10% in price (to 275k), but you don't have to pay PMI (because you put 20% down), assuming 1.25% property taxes... your payments are about $1600 a month on your balance that starts at $220k. If you buy the house right now, how much can you put down? If it's still 20% (of 250k), then you'll owe $200k on the house now, and still owe 200k in two years. But you'll have to pay that in 28 years instead of thirty, at whatever the new interest rate would be. So the assumed difference is $20k in two years, plus extra down payment (on the supposed higher value), plus higher taxes (because your house in two years is assessed at the higher value). I can see the attraction. But you'd better crunch all the numbers to make sure the risk and reward are well-balanced. Also look at lots of houses, not just the one you've fallen in love with. You need to be cold and clear-eyed when assessing a property. Nothing makes this easier than looking at two dozen houses for comparison. Be ready to walk away if your inspections reveal problems you don't want to deal with (or pay for); and do some realistic price comparisons to other recent sales, to figure out if the asking price is actually below market or not. Edit: Actually look at it this way. An interest-only loan is a lot like renting; 100% of your monthly payments are flushed away. The only difference is that you have also invested some cash in a building for which you can take responsibility. As yourself if you would feel comfortable investing $40k in real estate, at a cost of something like $8k (fees), all in a single house, while you rented something else. Sound good? Leperflesh fucked around with this message at 22:29 on Aug 5, 2010 |
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Aug 5, 2010 22:25
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Has anybody ever been to a condo auction before? The place across the street from my apartment is about to auction off 27 units. They're about 2 years old, almost all of them have never had owners, and a friend lives there so I know the place is nice. Add to the fact that they'll let me make an offer prior to the actual auction (which would let me take it off the auction) and I think I'm gonna make this my first home purchase. I've already crunched the numbers and don't think I need too much help on determine how to pay for it and such. My question is actually around what kind of strategy I should use when making an offer. As an example, most of the places I'm looking at were previously priced at about $300k (before auction stuff started, this is listed on auction web site). For all these units, the starting price of the auction is about $120k. Thanks to a quick look at the country's appraisal website, I can see what's on file and the units are appraised at approximately $148k. So what's my strategy for making them an offer? If I offer a little above the appraisal would you think that should make me a lock? I really want to avoid actually going to the auction if I can buy ahead of time, but I also don't want to run in and offer more than I have to. I'm not really concerned with what I can actually afford since I think I'd be offering below what I can go up to, it's more getting the best deal. Anybody who has insight, thanks.
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Aug 6, 2010 00:24
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Do you have cash? If not, have you investigated whether it's possible to finance your bid? Don't trust their appraisal. If you are serious, pay for your own appraisal from an independent source. Make sure it includes inspection of the actual property. You're going in blind in terms of what the association fees will be (since there's a massive change of ownership about to happen), so make sure that you have enough room in your budget to absorb a substantial increase of those fees, both immediately and over time, as the new association of owners gradually discovers whatever needs major repair and makes collective decisions about upgrades, services, costs, and how to pay for them. I've never bid on real estate, but for auctions in general, a good rule of thumb is to decide in advance what you think is a fair price, bid that price, and don't go a dollar higher. Remember that the highest bidder, by definition, is paying more than everyone else was willing to pay; if he immediately turned around and offered his property to sell, its value would drop to that of the next-highest bidder (in theory with efficient markets etc. etc.). With that perspective, auctions might not seem like such a great value. Consider what will happen if you submit a winning bid, of 18 submitted bids, for the 27 units, leaving 9 units unsold. You'll instantly see a huge chunk of your equity vanish in a puff of oversupply-smoke.
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Aug 6, 2010 00:59
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Leperflesh posted:Do you have cash? If not, have you investigated whether it's possible to finance your bid? Thanks for all the good info. Just as some extra facts, I have enough cash for the 20% down payment and all associated closing costs if I were to buy. You have to be financed by a lender to bid (currently looking around at rates). I wouldn't expect association fees to change that much, since right now the condo is actually 75% occupied. My friend has been there for 2 years and hasn't seen the fees change that much.
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Aug 6, 2010 15:24
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Yeah, with a 75% occupation rate, no way could they raise the fees: they've been hemorrhaging money as it is... they couldn't risk more tenants moving out in the face of rising fees. It may be that they have a 2-year backlog of maintenance work they haven't been able to pay for. OR, it all could be daisies, a well-run condo development which is a great bargain. It's possible. It just seems to me like there's some very big potential pitfalls there.
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Aug 7, 2010 17:23
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Yeah, this can go either way. The market has ended up doing some crazy things that don't really make sense, so the original owners could have gone bankrupt for stupid reasons. Or there could be serious problems with the building. This happened to a building around here. They were selling the building with parking spots, but they hadn't built the parking structure yet, so they were paying a valet to park the cars a couple blocks away. They were going to pay for the parking garage with proceeds from sales of the units. Prices went down, and all of a sudden you've got a bankrupt management company, no parking spaces, and all these units that paid an extra $20,000 for a parking space.
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Aug 7, 2010 22:55
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When the owner occupancy rate is that low, I would recommend staying the gently caress away because of risk in general for owners to flee or to invite renters (aka: people who don't give a poo poo) in. It's part of what drove my place's value down into the dirt. My place had (in reality) about a 60% owner occupancy rate and because there weren't enough owners present to veto the board's decisions to raise the rates 20%+ annually to keep the budget (which included paying some random lady $10k for "bookkeeping" and giving her raises each year apparently) somewhat near solvent, the dues have gone higher and higher, contributing to a downward spiral of owners trying to ditch their properties somehow, someway. We had about a 20% owner voter turnout each meeting by the end according to meeting notes - about 30% lived overseas, the rest who the hell knows.
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Aug 8, 2010 11:19
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MOTHER gently caress! Conditional approval. Can't wait to see what the list is  We cleaned up years of old credit skeletons before starting off on this.
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Aug 16, 2010 21:10
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Congrats, FB. You're nearly there, and there's not much that'd likely sink it at this point. Time to start packing.
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Aug 16, 2010 22:01
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I hope so, but it still scares the hell out of me. My wife and I both were in the 400's 2 years ago. We saved a few grand extra to cover any last minute oh shits, so we'll see.
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Aug 16, 2010 22:50
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Any thoughts here about the impact of potential deflation on the market? I'm looking to buy now. My father says I should wait. He's afraid of deflation in the States (I'm Canadian, looking to buy in Toronto). He thinks it will cause prices here to fall. Prices are declining here anyway, but only slowly. In general, how can I ever know when prices will be at their lowest? It's impossible. And obviously I can't wait forever. Should I buy now, and the home loses a lot of value over the next year, I'm prepared to ride that out. I wouldn't want to move for at least 7 - 10 years, and I might sell the house to my family after that so we can keep it as an income property anyway. Thoughts? When is the right time to buy?
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Aug 17, 2010 06:30
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The Canadian housing market still looks really overvalued to me, compared to historical trends.
gvibes fucked around with this message at 16:44 on Aug 17, 2010 |
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Aug 17, 2010 15:58
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Gotta pay something else off and write a pretty substantial letter of credit.  It sucks since that will eat up the extra cash, but that's the price I pay for having a hosed up financial life for so long.
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Aug 17, 2010 21:55
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Phlegmbot posted:Any thoughts here about the impact of potential deflation on the market? It is very likely that housing prices will decline further. We now have over 12 months of supply on the market, and that is with banks holding back on listing bank-owned homes as much as possible so as not to absolutely flood the market. In addition, the foreclosure crisis is far from over. The reports I've seen suggest that there are over 2 million additional homes waiting to enter foreclosure at this time. If unemployment does not improve, or (heaven forbid) deflation occurs, the rate of foreclosure will only accelerate. As if that wasn't enough, demand for homes is low despite rock-bottom interest rates. This demand won't go up until employment recovers. Combine low demand with high supply and the future isn't too hard to figure out.
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Aug 18, 2010 00:29
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Phlegmbot posted:Thoughts? When is the right time to buy? House prices respond to several economic factors. Supply and demand, obviously, both of which are complexly-derived from several other factors. Here are some: Interest rates (affects prices and demand) Unemployment (affects prices and demand) New housing construction (affects supply; builders look at economic forecast 2+ years out when starting a development) Availability of credit (affects prices and demand) Season (affects prices, demand, and supply) Inflation/deflation directly affects interest rates, and (since it affects the value of the dollar) it affects absolute prices as well. But broadly, either one tends to be compensated for: if prices are rising (because the dollar is losing value), interest rates are likely to be high (in an attempt to slow inflation), which reduces demand (because borrowers are rate-shy), which lowers prices. Conversely, if prices are falling (because the dollar is deflating and gaining value), interest rates are likely to be low (because the fed wants to encourage borrowing), which increases demand (because borrowers are attracted to low rates), which raises prices. So there is a built-in mechanism which may or may not be sufficient to control prices in an inflationary/deflationary period. But overall I personally think that unemployment is a vastly more important factor to watch (of course, unemployment and inflation/deflation are also linked!). When people are losing their jobs, they're also losing their houses, and/or not buying them, so houses fall... there's no brake on that. Likewise when unemployment is falling, people are having jobs and buying houses, which raises prices. Ultimately, I think it's good to pay attention to these national/international trends, but I think local conditions are much more important. Right now in the US, some markets are experiencing rebounding prices, while others are still falling; the difference has to do with local employment, the financial conditions in a given state, pre-existing oversupply, average age and income, etc. It's a complex picture. I think you should buy a house when you have decided that it is the right time in your life to own a house, you have saved up enough money to buy one, you have a reliable enough income to pay for one down the road, and you are ready to commit to living in the same place for a decade or more. Beyond that, it's too easy to get caught up in economic conditions. Obviously you don't want to be a chump and pay twice what your house will be worth in five years, but nobody can tell the future; just keep in mind that houses are not very good "investments" (because the historical returns are very poor, and they also suck up money in maintenance) financially. Instead, they are excellent investments in terms of quality of life (for some people), and that's where your focus should be. Leperflesh fucked around with this message at 00:41 on Aug 18, 2010 |
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Aug 18, 2010 00:39
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Leperflesh posted:I think you should buy a house when you have decided that it is the right time in your life to own a house, you have saved up enough money to buy one, you have a reliable enough income to pay for one down the road, and you are ready to commit to living in the same place for a decade or more. Beyond that, it's too easy to get caught up in economic conditions. Obviously you don't want to be a chump and pay twice what your house will be worth in five years, but nobody can tell the future; just keep in mind that houses are not very good "investments" (because the historical returns are very poor, and they also suck up money in maintenance) financially. Instead, they are excellent investments in terms of quality of life (for some people), and that's where your focus should be. Good advice, and what all of these questions about buying a house in relation to market conditions really boil down to. Should be added to the OP.
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Aug 18, 2010 15:31
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We're having to jump through a bunch of hoops now. I'm ready to drink myself to death, but only don't because the underwriter may want a BAC reading..
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Aug 18, 2010 17:58
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Farking Bastage posted:We're having to jump through a bunch of hoops now. I'm ready to drink myself to death, but only don't because the underwriter may want a BAC reading.. This is what's keeping me out of the market. I simply don't have the time or energy to deal with all the random bullshit involved in buying a house now, despite the money and security being there. Especially since all the properties I look at seem to foreclose a week after I view them.
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Aug 20, 2010 09:07
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Well, if anyone remembers my bitching from a few pages back, here's an update: we closed today! After a few calls from our real estate litigation attorney the sellers agreed not to back out on the contract. Things were mostly smooth from then until now; our sellers had another little scare towards the end when their bank held off until the last possible minute (Wednesday 5 PM) to extend a formal commitment on their purchase, and another strongly-worded letter from our attorney later, their bank got it together and they finally got to the table. Our closing was (frustratingly) still up in the air until about 9:30 AM today, but everything fell into place within literally 48 hours and who cares about all that now. I've spent all 6 hours that I've owned the house pulling up ugly carpeting and scoring ugly wallpaper. Oh god what have I done?
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Aug 21, 2010 00:02
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Something that the underwriters have started doing in the last few months is what's driving me nuts. As someone who did a MASSIVE credit cleanup, A lot of stuff was disputed through the bureau's resulting in several of the shadier items being outright deleted. However, if anything on your credit file shows up as disputed, or even has a note on it from a long ago dispute, they will kick your loan back. That's what I am dealing with right now. One of my prior accounts was disputed then verified, but transunion was still showing it as "verified/customer disputes" even though it was disputed 8 months ago. I call TU about it since it was one of my conditions on the conditional approval, but the only way they can change it is to " Make another investigation(dispute)", which of course completely fucks what I am trying to get done. It's getting to the point now, that the contract on the house will be up at the end of the month. I have to move at the end of the month since my place is up for rent and someone has committed. If it falls through I am loving homeless.
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Aug 21, 2010 02:24
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I'm curious about income verification, do they still ask to see old physical pay stubs? And if so, how far back? I'm trying to clean out my files as much as possible.
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Aug 30, 2010 18:18
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qirex posted:I'm curious about income verification, do they still ask to see old physical pay stubs? And if so, how far back? I'm trying to clean out my files as much as possible. Yep. But you can scan/email them, or a lot of lenders have a website where you can securely upload docs to them.
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Aug 30, 2010 18:53
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