How much minimum carry home Salary needed to buy home 300-325K
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Quote:Well, I'm not entirely sure that such a rigid approach is always correct, esp. for a first time buyer.
Originally posted by sville
Knowing that the range your mentioned does not go beyond the approval limit should be fine for him
Never assume that the REA will show you 10K-20K above your limit.
If he shows you LIMIT+20K, well, yes, that's your another RED flag.
What part of "320K is my LIMIT" can be misunderstood by any REA?
Again, have your range narrow and tight.
320K-340K means MAX 340K.
Unless the buyer has previously spent considerable amount of his own time researching properties, features, asking vs sale prices, etc. they cannot come up with a concrete hard and fast number.
To me, that's where a RE agent can be most helpful - a good RE agent, that is.
The agent can and should show the buyer all types of possibilities.
A lot of times, the buyer may have pre-conceived ideas about how much a house should cost in a certain area and insist on seeing houses only within that range.
But that amount that he/she has in mind is usually not based on thorough research.
It is usually based on perceptions, opinions, chatting with other people and what a friend or friend's friend paid at some time in the past.
A RE agent has access to all MLS listings, asking and sale price, local market knowledge, future plans for the area, etc and can help set the buyer straight on that.
Secondly, a RE agent can and should (IMO) show the buyer properties both in the lower end of their range and in the higher end of their range (and perhaps slightly above) to help the buyer decide whether they still want to stick to their limit or pay slightly more for better features.
Sometimes, by going just a little above range can provide better value for money.
I'm not saying that an agent should tempt someone with a range of $300K and show them houses worth $500K.
Similarly, someone with an upper limit of $300K should consider houses in the $310K range too.
They may be able to negotiate down to $300K, esp. in this type of market.
But in the end, it's the buyer's decision.
If $300K is the absolute maximum he can take on without endangering his finances, then they should stick to it.
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"Mah deah, there is much more money to be made in the destruction of civilization than in building it up."
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Nice post by sville, Fido and others.
I really can see change in behavior of our people does not matter race/color/origin/US/Canada. People are taking driver's seat on their accountability and financial responsibility. They are doing more analysis these days than taking direct crap from experts. We are turning from spending/borrowing/spending economy to saving/investing economy and that is the future.
Recession is bad and very bad for most. But one good thing I can see in recession people are waking up and they are participating more.
We are having temp 10’C in Calgary today/tomorrow so leaving for skiing with my son. Enjoy your weekend with friends/family.
Quote:
Originally posted by sville
The REA should NEVER ask you about your approval limit.
If he asks you, yes, that's your RED flag.
He or his work, nothing concerns the approval limit.
Knowing that the range your mentioned does not go beyond the approval limit should be fine for him
Never assume that the REA will show you 10K-20K above your limit.
If he shows you LIMIT+20K, well, yes, that's your another RED flag.
What part of "320K is my LIMIT" can be misunderstood by any REA?
Again, have your range narrow and tight.
320K-340K means MAX 340K.
If you assume you will be shown houses for 350K, yes, that's your mistake. It's not your REA's fault.
If He shows you 350K, it's his mistake. But if you don't speak up, well it's your mistake. Don't blame REA for your "chal jayega" attitude.
And trust me, if you don't know/show your MAX limit, the REA will create that limit for you.
I agree this could easily be a new thread and perhaps a *sticky* however it can still go with the 'Original Post' as it is still covering issues like being firm on the limit and 'Role of REA' which is a significant bridge b/w the buyer and the loan/mortage....
-So does that mean a buyer can contact as many RE (perhaps one by one) or meet many and choose one and then visit houses with this one person- with the view that you have a 'relationship' with him/her.
- Does experience or age be a factor- with no knowledge I feel a young person would perhaps be better as he would like to establish himself and would work harder for me....
- Can gender be a factor too?
-I see some REA work as a team of 4-5- is that a a good thing?
- I've seeen a few agencies like, Remax, Royal Lapage, Capitol etc(sorry if i've misspelled)- does that matter if so, which one is the best?
Thanks a lot for the knowledge sharing- it would be good to hear from some of the REs- what make them better? Or how are some of not so good REAs- insider's view?
Thanks,
~K
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Quote:
Originally posted by sville
Damn.
This should be in a new thread.
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Location: carl sagan's universe
Posted on: 30-01-09 18:25:15
Quote:
Originally posted by kalia
Can someone suggest how much should be minimum carry home Salary needed to buy home approx 300-325K with 10% or 20% down payment?
Thanks
Interesting to note that nobody has asked you the amortization period, nor have you mentioned it.
25 yr 30 yr 35 yr?
You can also take a 35 yr loan and pay the amount of a 25 year loan or more- you have to talk to lender to allow this- they usually do so that in case you lose your job like many are subject to, you can revert to paying the 35 yr term.
I just wangled that and more for a client in these diff times. He lost his job and said he wanted to pay only his 40 yr (unavailable now) amount per month, based on savings and his wife's salary. Since in the last 2 years he had paid the 25 yr amount every month and also at end of every year was paying $3000 - $4000 extra on his mortgage , the lender agreed to a 60 day moratorium on payments and to resume 40 yr amounts after that.
Boy was the guy relieved. Now he can concentrate on his job search w/o that hanging over his head. Hope fully in 60 days he can find a job.
As an example, if you take a $300,000 35 yr loan now at 4% (just for illustration purposes) the monthly is 1322.
For a 25 yr term the amount is 1578
If you take the 35 yr term and pay 1578 and after say 2 yrs you lose your job you can revert to paying 1322 to keep the mortgage going until you find a job. At that point of time even the lender might agree to a 2 month no payment- maybe even 3 months, so you don't have that hanging on your head while looking for a job. Once you get the job you can restart paying 1578 and even catch up missing payments.
I know of many who have taken longer term mortgages but are paying shorter term amounts.
Always good if u r disciplined enough to ensure paying the 25 yr term amounts.
Anyway just a few ideas to throw out at you. Mull over them.
Also if u take a variable be prepared for your payments to expand and contract accordion style.
All things to ponder.
best to jot down all points given you.
Also many are now opting for fixed 5 yr which is available for around 4.34%, so they can really budget their payments and not be surprised if inflation hits and money is lent at exorbitant rates like 8 -9%.
Actually based on recent history from 1980's anything below 5% for a five year term is a reasonable fixed rate.
Man, looks like I threw too many spanners into the works.
Deleted. I killed the formating.
Best advice I could give is don't approach agent the moment you decide to buy a house.
Visit open houses in various areas. I have friend that did that for almost 2 years. Every weekend, saturday and sunday, 3-4 hrs each day.
Know your requirements and affordability. Talk with the seller's agent who is showing the open house. He might think you are dumb. But that's a good way to learn.
That will help you a lot and in understanding your MAX limit.
pratickm mentioned that's it might be tough to stick to a narrow range. I agree. It's not that easy.
Example: You see AccordLX for 31K and the agent shows you AccordEX with Nav system and moon roof for 33K. Hmm .. there goes my max range of 31K.
Visiting open houses helps here. Visit houses from and beyond your range.
Originally posted by kisi143
-So does that mean a buyer can contact as many RE (perhaps one by one) or meet many and choose one and then visit houses with this one person- with the view that you have a 'relationship' with him/her.
You can and should visit more than one REA. But you should sign a contract with only one. (Actually you can sign with multiple, but it's like telling multiple REAs to come and collect their pay upon your purchase)
Originally posted by kisi143
- Does experience or age be a factor- with no knowledge I feel a young person would perhaps be better as he would like to establish himself and would work harder for me....
I don't think age matters. Buffet was as dynamic in his 30s as he is today. (Question is, how many actually identified his potential at that time)
But experience, well yeah it might (it's a big "must"
. That's why I would suggest REA LIVING in the area where you are looking to buy.
(Having 20 yrs experience on resume does not mean that person really have that level of knowledge)
Originally posted by kisi143
- Can gender be a factor too?
Nope.
(hehehe, unless you go ga-ga)
Originally posted by kisi143
- I've seeen a few agencies like, Remax, Royal Lapage, Capitol etc(sorry if i've misspelled)- does that matter if so, which one is the best?
I don't think so. At the end of the day it's the REA's experience and his work that matters. You don't really deal with the "ReMax Company". You deal with a single person.
Originally posted by kisi143
-I see some REA work as a team of 4-5- is that a a good thing?
Now that's what always make me wonder.
Let's see the good good goodies:
. You have 5 ppls working for you.
. 5 times exposure.
. If one goes on vacation, you have other 4 to support.
. There is always atleast one agent whose schedule matches yours. (When it comes to visiting houses)
Now, the bad and the uglies
. Do I have to explain my requirements to all 5? (3brd, unfinished basement, away from main streets, etc whatever your reqs. are)
. Does that mean one agent only cares 20%? (hmm .. the other 4 are there .. it's okay if I don't worry too much)
. The communication that you have with one during 2 hrs visit of 5 houses .. does that communication is passed on to the remaining 4?
("Hmm .. nice house, but the backyard falls toward apartment bldg, rest all is good .. but coz of those apartments on my backyard, i do't like this house." Does this message reaches all 5?)
Most of the Realtors ask buyer to sign contract and get their Mortgage limit assessed by the Mortgage Agent associated with RE broker firm and so they trap buyer nice and properly.
Can anyone suggest about following
How to avoid the above process?
Is one better off dealing with known Realtor or unknown Realtor?
Thanks
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