Episode #125 of the Stack Overflow podcast is here. We talk Tilde Club and mechanical keyboards. Listen now
96

Transfer the ownership of the house now. If you have broken up and your SO has moved away you don't want them to have a share in the house you are living in. They can cause you a lot of trouble down the line, including: vanishing and never paying you back any loans; preventing you selling the place when you want to (by refusing or just by not being ...


38

the highest offer we could make is substantially below the asking price by around 5%. I wouldn't necessarily call that 'substantial', especially if the property has been on the market some time (I surmise this from "sales in our local area are slow"). That you are ready to proceed also makes you a strong contender, and reduces the window of opportunity for ...


33

Does it make sense for me to keep the house Are you willing to be a landlord for $91 a month? What happens if your house goes unrented for 3 months? 6 months? How will you pay its mortgage? In my opinion, you don't have enough buffer to make this worth the risk. If you could afford for it to go unrented for 6 months then it might be a good investment in ...


23

It is important to differentiate between corporate and governmental policies. It is unlikely that the governmental policies are that draconian. However, it is plausible that corporate policies are exactly that. If customer A does not meet these guidelines, then the answer is "No". There is another possibility, if you have already been turned down. ...


20

I think what you are looking for is a reamortization or recasting. Basically, after you make a lump sum or few extra payments you can ask the bank to recalculate your mortgage payments based on the remaining balance keeping everything else the same. This is done for a fee though it should be less than closing costs if you were to refinance. See Investopedia: ...


19

Is my calculation correct? More or less. Your list of expenses is not complete and repair/maintenance expenses can vary wildly. You'll also depreciate the house (not the land), so with your current numbers you could be running a loss for tax purposes which can offset income tax on other income and basically act as a discount to your cost of equity, so ...


10

Is this the best way to lower a mortgage? The main financial reason to re-finance is to lower the interest rate (in order to reduce the amount of interest that is paid). There's no point in refinancing just to lower your monthly payment if you're going to pay extra anyways. When you pre-pay (with most mortgages at least), your payments going forward will ...


10

Go with DJClayworth's suggestion. If you don't, in addition to the problems he pointed out, you're in for a very messy negotiation when you sell (even if you both agree to sell at the same time and both agree to sell at the same price, which is not a given). Why? Because it's like a divorce settlement, the chances you agree quickly on how to share the ...


9

A house's value is whatever it is sold for when you sell it. This doesn't change based on how much you put into the house. There are a lot of examples of that, but let's say you buy a house for $100K. If you assume that the home's "value" increases at 4% per year (and inflation stays at 0%), your house will objectively be worth $324K at the end of 30 years. ...


8

As Dave Ramsey says, "The only ship that won't sail is a partnerSHIP." That means you essentially have a joint venture in this property. You need to sell your half to your partner, or your partner needs to sell their half to you, end of story. Get a fair assessment of the current value of the property and pay the other party out their due, or sell it and ...


8

You asked a few related questions: My question is - is a credit report actually the source of truth for debt to income calculations? Am I mistaken and instead the consumer is trusted to furnish accurate information? Does the underwriter or whomever actually call the owner of each debt that is listed to confirm the current amount and minimum payments? ...


7

Yes if the interest rate is the same and overpayments are applied to principal then you can get a 30-year mortgage and pay it off as if it were a 15-year mortgage. The risk is that you decide that rather than overpaying you'd rather buy a car, or go on vacation, etc. and you end up paying it over 30 years anyways. A shorter term forces you to pay it off ...


7

Pete B. has provided a practical answer. I'm answering separately to address an interesting point you brought up: (Alternatively ... is this all bound by regulation now, so that the concept is legally impossible now?) In the strictest "regulatory" sense, in most countries, there are basic banking regulations that strongly deter making loans to people who ...


7

Assuming it's under English law - Scotland is different - then offers are not binding. Similarly, acceptance of offers by the seller aren't binding either. It only becomes binding when the contracts are exchanged. If you are in Scotland, then check the local law. This means that gazumping is possible, and there's nothing you can do to stop it, other than ...


6

Without knowing your financial goals, income, other assets, etc, I can't make a recommendation. For example, do you have a sufficient emergency fund to cover both the expenses for this home and your new one should you lose your tenant and/or your job? However, one part of the calculation you did not mention is tenant turnover. Does your projected rent ...


5

The only way to see the full picture is to create a spreadsheet with two sides: On the first side, map your income from the investment property over the years, including everything down to potential vacancies, repairs costs, and closing costs On the other side, map how much you'd make by selling the house at a given point of time and investing the remainder ...


5

People already answered, but the point is you have a flaw in your thinking. December interest is not interest on december's principal payment amount. You're paying interest on $300k (which is why it's so much), not on $450 (which would be 200% interest per month), your december interest is reduced by about 0.3% (3.7%/12) of $450 (the additional principal you'...


5

Whether 5% cash back is an advantage depends on the figures. For example, for $1m over 10 years it is advantageous; over 15 years it is not. Illustrating with calculations: s is the principal r is the monthly rate n is the number of months d is the monthly payment s = 1000000 r = 2.79/100/12 n = 12*10 = 120 d = r s (1/((1 + r)^n - 1) + 1) = 9559.44 The ...


5

The thinking might be very logical; yet the usual problem is that you do not have the data to make the optimal decision: if there are other buyers and how much are they willing to offer; how quickly does the seller need the money... The rule of thumb is that the lower your offer the more risk that it will not be accepted. Having said that: But if we ...


5

If you want to buy a house for below market price, don't fall in love with the house. Look at many houses, and focus on those which are short-sales or distressed properties. Alternatively look for properties which have been on the market for some time and have not had many viewings, and appear to be undervalued, but which also show potential. Keep an eye ...


5

There’s no standard for early redemption penalties. Some mortgages have them and some don’t — read the small print of any mortgage you are thinking about applying for. But in general, avoid fixed-rate mortgages and go for floating rates, which are much less likely to have redemption penalties.


4

There's actually a few different things to unpack from your question. First up: is it possible? Absolutely! That's actually what a home refinance is - you're getting a different mortgage on your house. The new lender repays the remaining principal on the existing loan. The main difference is, you're refinancing a smaller amount - which isn't even an ...


4

Just think of it as you loaning them the mortgage payments until you sell the house. Suppose (for the sake of round numbers) you bought the house for $100k with a downpayment of $10k each and a mortgage for $80k, then you sell the house for $200k when there is still $40k owing on the mortgage. At 5% over 25 years the monthly payments are $468. In the ...


4

This is lawyer ball Really, it's time to get the big guns involved. Even if this deal is amicable, you need outside help creating a mutually acceptable arrangement. There needs to be a written contract, and it needs to be set up right. This is how I would do it. I would use a share-based organization like an LLC in share mode. Every dollar/Euro/...


4

Three additional things to consider. (1) Are you planning on buying a house in the new town you will be moving to or are you renting? If you choose not to sell your old house and buy a new house you will have less money available for a down payment, which will result in a longer mortgage at a higher interest rate. (2) This assumes you will be able to have ...


4

Interest does not "disappear", but it is reduced in proportion to your outstanding principal balance. Interest accrued in a pay period (month) = Principal balance * Interest rate (monthly) It sounds like this is what you probably meant. In your example, Dec-19 interest is reduced to what Jan-20 interest would have been without the extra payment.


4

Can you ? Yes.... probably. It depends on the equity you have in the existing house and the down payment you need for the new house and your debt to income ratio and a few other things. Should you ? Probably not. HELOC likely has far higher interest than a mortgage would. There's a reason why banks don't want you to get a loan for a down payment. ...


4

First see what information you can gather: Who are the people that are selling? Why are they selling? Is there non-monetary benefit you can give them (for example a quick sale, longer time to move out, etc)? Decide your target price - make sure it's not a round number. If you can meet in person, or talk on the phone do that. You can try the the 65-85-95-...


3

You're overlooking some huge tax considerations. Deducting mortgage interest First, you get to deduct the interest, taxes and insurance on the home, because it's your primary or secondary home. So I see $1001 of interest and taxes, armwave $99 of insurance, and that's $1100/month or $13,200/year of deductions. (By the way, if this is news to you, you ...


3

How does this help to get rid of the excess inventory? In other words, why would borrowers "better" or more easily qualify for the loan if the developer does the buydown? Buy-downs were popular in the United States before the great recession because it made it easier for the buyer to get approved for the loan. The first years payment (which was reduced ...


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