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Started By
Message
Buying house. Put 20% or renovation
Posted on 9/5/24 at 3:49 pm
Posted on 9/5/24 at 3:49 pm
What’s board’s opinion? 20% would be 100k down and note would be 3100 or put around 25-35k down and about 30k towards kitchen Reno which is needed and note would be about 3600. Me and wife each make about 120k each a year
9
Posted on 9/5/24 at 3:58 pm to FlappingPierre
What is the PMI quote if you only do the 25-35k, and how soon can you have it evaluated for the PMI to be removed?
It has been about a decade, but I was in a similar situation and went with the put money towards reno option. Verbiage in the loan was we would need to wait at least 6 months and pay for a new appraisal showing at least 25 or 30% equity before the mortgage company would remove the PMI.
It has been about a decade, but I was in a similar situation and went with the put money towards reno option. Verbiage in the loan was we would need to wait at least 6 months and pay for a new appraisal showing at least 25 or 30% equity before the mortgage company would remove the PMI.
Posted on 9/5/24 at 3:59 pm to FlappingPierre
Do the Renovation loans with FHA/Fannie/Freddie
Let them pay for it upfront and put 3-5% down then finance the project
Or Reno loan and 20% down
Let them pay for it upfront and put 3-5% down then finance the project
Or Reno loan and 20% down
Posted on 9/5/24 at 4:13 pm to FlappingPierre
Where’s the extra $30k going?
$100k
Or
$35k down plus $35k for Reno= $70k
$100k
Or
$35k down plus $35k for Reno= $70k
Posted on 9/5/24 at 4:19 pm to FlappingPierre
When I bought this house four or so years ago, I had the same situation. The difference between 10% down and 20% down was a quarter of a percent in interest and about $31/mo in PMI. We put down the 10% and did the reno.
If there’s a significant interest difference or if PMI gets crazy, that would obviously influence things.
If there’s a significant interest difference or if PMI gets crazy, that would obviously influence things.
Posted on 9/5/24 at 4:29 pm to Joshjrn
Pmi I think is $70 a month so nothing really
Posted on 9/5/24 at 4:29 pm to baldona
Other money would be in savings or other projects
Posted on 9/5/24 at 10:27 pm to FlappingPierre
Just make sure you read everything on getting rid of the pmi. It was 12 years ago but I built a house and my realtor told me I could get rid of PMI once the appraisal value got above the 20%.
Turns out that was not the case and I had to wait like 10 years no matter what to get rid of the PMI.
Turns out that was not the case and I had to wait like 10 years no matter what to get rid of the PMI.
Posted on 9/5/24 at 10:54 pm to Rize
quote:
Just make sure you read everything on getting rid of the pmi. It was 12 years ago but I built a house and my realtor told me I could get rid of PMI once the appraisal value got above the 20%. Turns out that was not the case and I had to wait like 10 years no matter what to get rid of the PMI.
I’m with Chase. Mine auto drops after 5 years, but if I’m willing to pay for an appraisal, I can drop it sooner. For $31/mo, I figured the juice wasn’t worth the squeeze.
Posted on 9/5/24 at 11:35 pm to Joshjrn
quote:
I’m with Chase. Mine auto drops after 5 years, but if I’m willing to pay for an appraisal, I can drop it sooner. For $31/mo, I figured the juice wasn’t worth the squeeze.
Yeah I think mine was Wells Fargo and it was $150 to $200 month. No way to drop it no matter what. I was so pissed when I found that out.
This post was edited on 9/5/24 at 11:39 pm
Posted on 9/6/24 at 5:22 am to FlappingPierre
I would put down less and do the reno.
And that is coming from someone that did the opposite and wishes they hadn't
And that is coming from someone that did the opposite and wishes they hadn't
Posted on 9/6/24 at 9:59 am to FlappingPierre
Probably in the minority, but after my first house we always paid 20% down on a 15 year mortgage. Decided I shouldn't buy the house if I could not swing that.
Technically, the answer should be what else you would do with the money. You can calculate pmi and the difference in interest costs in both approaches and decide what you would do with the difference.
Technically, the answer should be what else you would do with the money. You can calculate pmi and the difference in interest costs in both approaches and decide what you would do with the difference.
Posted on 9/6/24 at 10:54 am to KennytheTiger
is the kitchen currently functionable? if so put down the 20% and save up the $30k over the next year. if you're making a combined $240k, $30 should be doable in short time frame. unless you are planning to do the reno prior to actually moving in then i'd say do whatever to make that happen to avoid disruption while living there.
Posted on 9/6/24 at 12:57 pm to FlappingPierre
quote:You sure about that? I would say it's closer to $250 on a 450k mortgage.
Pmi I think is $70 a month so nothing really
Posted on 9/6/24 at 5:10 pm to The Mick
We paid 636 and put 100 down (financed 536) and our pmi is 80. Pmi is dropping off in October this year.
I have no clue how pmi is determined.
To the OP, personally I'm a fan of earning an upgrade to the kitchen. Put the 100 down and like someone else said save it up over the next 6 months to a year. It's personal preference though. It'll just help your equity situation down the road if you can put the 100 down. I'd be curious if a $30k renovation adds $30k in appraisal value.
I have no clue how pmi is determined.
To the OP, personally I'm a fan of earning an upgrade to the kitchen. Put the 100 down and like someone else said save it up over the next 6 months to a year. It's personal preference though. It'll just help your equity situation down the road if you can put the 100 down. I'd be curious if a $30k renovation adds $30k in appraisal value.
Posted on 9/6/24 at 5:14 pm to ks_nola
Yea the kitchen is functional but my plan is to maybe do reno prior to moving in
Posted on 9/6/24 at 5:27 pm to FlappingPierre
quote:
maybe do reno prior to moving in
Couple points on this. First, expect to pay 2x whatever you think it should cost. Second, expect it to take 2x longer than you think it should take. Third, doing a kitchen reno while you live in the house is a giant pain in the arse.
Posted on 9/7/24 at 7:26 am to WhiskeyThrottle
Ok that’s great…. PMI rates must have come down over the years.
Posted on 9/7/24 at 7:50 am to Rize
quote:
Yeah I think mine was Wells Fargo and it was $150 to $200 month. No way to drop it no matter what. I was so pissed when I found that out.
FHA loans with under 10% down have MI for the duration of the loan. Only way to drop is to refi.
Posted on 9/7/24 at 7:51 am to The Mick
quote:
Ok that’s great…. PMI rates must have come down over the years.
PMI is private (the P) and for conventional loans. It’s a different rate schedule than MI which is for FHA loans, for example.
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