Congratulations!!! I’m so happy you were able to purchase a home! 🍾🍾 the one thing I had added to my contract was having the seller pay for a year of a home warranty contract. It just added a little more piece of mind purchasing a home with so many things that could break in the first year. I’ve been watching you for years and I’m so happy for you and your growing family! 🖤🤙🏽
Smart! Smart! Smart! Especially keeping insurance and property taxes out of escrow. When we bought our first home 35 years ago, we did not realize we had the option to handle property taxes and insurance ourselves. That first year our lender over estimated both annual costs (it was a new build with no previous property tax assessment), and the lender collected (charged us) more than the actual cost. At the end of the year they over estimated by several hundred dollars (and making interest off of it) yet, were reluctant to refund us the difference, saying it would go into next tax year’s escrow. We called bullshit, and that’s when they told us we did have the option of handling these costs ourselves. Banks - what a racket!
Wow!! Thanks for sharing. Its been so helpful asking veteran homeowners about these things because our lender never mentioned it until we brought it up.
Congrats on your new home! I’m planning to build next year, and my numbers should work out pretty similarly to yours, for some reason it was nice to hear that this all worked out for someone else, haha. It’s like I’ve done the math a thousand times but it still makes me nervous because it’s a huge purchase! Also, I’m in my late 30s and until fairly recently thought you had to use an escrow account-everybody I had known that had a home used one. You learn something new everyday, haha. I’m definitely planning to forgo it and stash the money in my HYSA like you said!
Majority of people use escrow because “that’s the norm” and people don’t know it’s something they can opt out of. I didn’t know it was an option until my father in law told us.
Congrats on the house! That seems really cheap for homeowners insurance if the house is as big as you said in other videos. Glad you got a good deal, but I would watch out at renewal time next year.
Yeah it’s really low but the deductible is high for hail damage. We just put on a Class 4 roof so hopefully no hail damage this year. We will review the policy again next year.
Thanks for sharing your real numbers!! So happy y’all found your first home ❤ Questions: how did you find your realtor / pick the lender, broker etc. who helped you?
Great video bc they don’t tell you all the costs upfront, but as you go through the process. We bought down our interest rate some so we wouldn’t be overextended on the monthly payment. Still hoping rates come down so we can refinance. The appraisal was nerve wrecking bc it would’ve been tough to come up w the difference if it appraised for less than we offered…
Great video, thanks for sharing! Did you consider an FHA loan? When getting pre-approved, did they look at both of you equally or focused more on the one with a better situation (higher credit score, less debt…)
Earnest money depends on your market. 10k is standard for multi families here. Single family earnest money is higher. Your realtor should be able to tell you what is acceptable/expected where you are a looking to buy.
One thing I'm confused about (that I never thought about until your video) - so you get pre-approval for a mortgage from any bank, but you don't have to actually get the mortgage from that specific bank? Thanks for this video, Justine!
We bought a new build home in 2017 with 4.5% interest rate; 5% down payment forcing to get PMI. I need to look up all my tracking info to send you details of our experience
My question on buying down is how much that interest rate lowering would have saved you over the course of the entire loan. That is really the savings not just the monthly lowered payments.
Yeah I’m certainly not an expert, but I think the calculation is more complicated than simply dividing the fee by the amount saved per month. You would at least have to take into account how it affects the amortization schedule & the total amount paid. Paying the $11k might save you THOUSANDS in the long run & not just because you pay $200 less a month.
I would take the 7% but asap I would put $10k-$11k as a lump sum onto the principal to reduce interest. Use an online mortgage amortization calculator to see how much difference that makes in reducing the interest for the term of the loan.
Wish I would have make an email account just for the home purchasing process. Easy to forget an important time sensitive email if it’s hidden with all your other life emails
My cash to close was miscalculated so I got to do an additional wire for under a thousand bucks WHILE SITTING AT THE CLOSING TABLE and hope it didn’t get held up (it didn’t luckily). Extra frustrating as I’d already rounded up on my first cash to close wire and was still short. 🙃
Can you explain how the closing cost only added $1361.03 to your down payment, (119,361.03-118,000) but you said the closing costs were $9381. Aren't closing costs separate from the down payment? What am I missing?
They had already paid $10k in earnest money to the title company. This is a placeholder to confirm their intent to buy but it was counted in the total needed. The title company subtracts what they already have on hold and tell you what is left to pay them.
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can't wait for the first budget after your house purchase, and congradulations.
Congratulations!!! I’m so happy you were able to purchase a home! 🍾🍾 the one thing I had added to my contract was having the seller pay for a year of a home warranty contract. It just added a little more piece of mind purchasing a home with so many things that could break in the first year. I’ve been watching you for years and I’m so happy for you and your growing family! 🖤🤙🏽
Smart! Smart! Smart! Especially keeping insurance and property taxes out of escrow. When we bought our first home 35 years ago, we did not realize we had the option to handle property taxes and insurance ourselves. That first year our lender over estimated both annual costs (it was a new build with no previous property tax assessment), and the lender collected (charged us) more than the actual cost. At the end of the year they over estimated by several hundred dollars (and making interest off of it) yet, were reluctant to refund us the difference, saying it would go into next tax year’s escrow. We called bullshit, and that’s when they told us we did have the option of handling these costs ourselves. Banks - what a racket!
Wow!! Thanks for sharing. Its been so helpful asking veteran homeowners about these things because our lender never mentioned it until we brought it up.
You should talk about PMI when you don’t pay 20% down payment. I’ll details later of how we got it off earlier
Congrats on your new home!
I’m planning to build next year, and my numbers should work out pretty similarly to yours, for some reason it was nice to hear that this all worked out for someone else, haha. It’s like I’ve done the math a thousand times but it still makes me nervous because it’s a huge purchase!
Also, I’m in my late 30s and until fairly recently thought you had to use an escrow account-everybody I had known that had a home used one. You learn something new everyday, haha. I’m definitely planning to forgo it and stash the money in my HYSA like you said!
Majority of people use escrow because “that’s the norm” and people don’t know it’s something they can opt out of. I didn’t know it was an option until my father in law told us.
Thank you breaking this down with your own numbers and making the home buying process seem less daunting
You bet!
I have always held my own escrow. Never ended up short on my escrow account and then had the mortgage go up suddenly to make up for that.
Wow you are so disciplined
Congrats on the house! That seems really cheap for homeowners insurance if the house is as big as you said in other videos. Glad you got a good deal, but I would watch out at renewal time next year.
Yeah it’s really low but the deductible is high for hail damage. We just put on a Class 4 roof so hopefully no hail damage this year. We will review the policy again next year.
Thanks for sharing your real numbers!! So happy y’all found your first home ❤
Questions: how did you find your realtor / pick the lender, broker etc. who helped you?
Congratulations.Thanks for this video I learning along the way.
Been waiting for this video!!
Great video bc they don’t tell you all the costs upfront, but as you go through the process. We bought down our interest rate some so we wouldn’t be overextended on the monthly payment. Still hoping rates come down so we can refinance. The appraisal was nerve wrecking bc it would’ve been tough to come up w the difference if it appraised for less than we offered…
Great video, thanks for sharing! Did you consider an FHA loan? When getting pre-approved, did they look at both of you equally or focused more on the one with a better situation (higher credit score, less debt…)
Earnest money depends on your market. 10k is standard for multi families here. Single family earnest money is higher. Your realtor should be able to tell you what is acceptable/expected where you are a looking to buy.
One thing I'm confused about (that I never thought about until your video) - so you get pre-approval for a mortgage from any bank, but you don't have to actually get the mortgage from that specific bank? Thanks for this video, Justine!
That's correct. You can get the pre-approval from one bank and the actual mortgage from another one.
We bought a new build home in 2017 with 4.5% interest rate; 5% down payment forcing to get PMI. I need to look up all my tracking info to send you details of our experience
Please do!! How much PMI do you have? We had friends in Ft Worth do PMI and it was very little.. less than $100/mo which was worth it for them.
Your credit score doesn’t matter on escrow/ you just have to put at least 20% down to not have it in your mortgage company:)
My question on buying down is how much that interest rate lowering would have saved you over the course of the entire loan. That is really the savings not just the monthly lowered payments.
Yeah I’m certainly not an expert, but I think the calculation is more complicated than simply dividing the fee by the amount saved per month. You would at least have to take into account how it affects the amortization schedule & the total amount paid. Paying the $11k might save you THOUSANDS in the long run & not just because you pay $200 less a month.
I would take the 7% but asap I would put $10k-$11k as a lump sum onto the principal to reduce interest. Use an online mortgage amortization calculator to see how much difference that makes in reducing the interest for the term of the loan.
Wish I would have make an email account just for the home purchasing process. Easy to forget an important time sensitive email if it’s hidden with all your other life emails
That is SUCH a goood idea!!!
My cash to close was miscalculated so I got to do an additional wire for under a thousand bucks WHILE SITTING AT THE CLOSING TABLE and hope it didn’t get held up (it didn’t luckily). Extra frustrating as I’d already rounded up on my first cash to close wire and was still short. 🙃
Oh no!!
That’s interesting about waving escrow, but I don’t think that could apply to way we bought our home
Can you explain how the closing cost only added $1361.03 to your down payment, (119,361.03-118,000) but you said the closing costs were $9381. Aren't closing costs separate from the down payment? What am I missing?
They had already paid $10k in earnest money to the title company. This is a placeholder to confirm their intent to buy but it was counted in the total needed. The title company subtracts what they already have on hold and tell you what is left to pay them.
He’s your husband! Partner 🙄
I use it interchangeably!