All our eggs in one basket? First time home buyers...
February 21, 2014 4:01 AM Subscribe
My wife and I have been working and saving over the last 4-5 years. We've managed to pay off all of our debts and have gotten ahead. It feels great to be debt free, but we want to buy a house. We found a bank foreclosure that's been sitting vacant for 6 years as it slowly worked through the courts. We have just enough to buy it outright, but that will leave us almost broke. Should we buy it?
posted by karst to Home & Garden (28 answers total) 4 users marked this as a favorite
It's a 4 bedroom with a non-conforming one bedroom cottage on a 1/2 acre. I think the price we are paying isn't much above the price of the land. The house(s) are almost live-able now but will definitely need some work after 6 years unoccupied. Neither of the inspections came up with any surprises (we had 2 done just for peace of mind). I prefer owning outright, but the 20% down, 30-yr mortgage seems to be the model. I know there are tax advantages to mortgages and presumably other advantages. Without a mortgage we don't need full insurance, though, which is a big savings. At this point we've offered 25% below asking, bank countered with 7% off, we countered 20% below, bank countered with 12% off. If we accept the banks offer now we will be down to about $5k in savings after closing. Our expenses are negligible, so weekly paychecks should get us breathing room (and go towards improvements). It's our first time buying a home. Are we doing it wrong? FWIW, we like projects. We'd rather put our stamp on something than buy a "cookie cutter" home.