Trying to buy my first house.

[Doug]

I brought up the subject a while ago. I have lived in an apartment for my entire life, and my aunt, who was my moms best friend offered us a house a while ago but changed her mind for some reason. Now she wants us to move in and live there rent free, and to save the money we would pay on rent for a downpayment. I am not sure how long of a timetable we were to stay there, but friends are telling us that now is the time to purchase a house. here in California the interest rates are pretty low. It is possible to get a decent house for $150k in a decent neighborhood, but a good distance from work, maybe 45 minutes each way.

I need advice/prayers on this. My parents were upset with themselves because they had opportunities to purchase houses/properties back in the day when things were cheap but they didn't jump on them. I think that time has come around again, I don't want to commit the same mistakes my parents did. I could just wait till I graduate and get a good job but something like this might not happen again, or my life situation might change for some unknown reason. I have the downpayment and the credit to do it, we could get a decent house with my brother, but he has issues saving and doesn't see it as a good opportunity like I see it.

[bonnie]

Buy a little less than you can afford.From your first payment add 25.00 a month to your house payment EVERY month.You will pay a lot less,by many thousands in interest and pay for your home years ahead of time.

If you have to skimp on other area's,make sure that 25.00 is added every month.

A relatively painless way to shave years off your mortgage

[bonnie]

DOUG

I think the government has a deal for 1st time buyers

you might want to check in to that

dgrimm60

I think that came to an end April 30th

[Woody]

Doug. I think this is a great time to buy. And it is wise to do it early in your life as long as you anticipate that you want to live in the area for awhile.

[Liz]

My only advice, is to get everything in writing. Whether that is living rent free in your aunt's house, or buying that house or another one. Just make sure it is all in writing, so that everyone is on the same page, and knows what is to be expected.

Oh, I guess I do have another piece of advice. Do whatever it is, for you and you alone. Your brother may end up living with you, but I wouldn't go into a contract with him. You don't want to entertwine your credit with someone else's, unless you are married; it is just way to hard to get it all untangled.

[Gordon1]

Hi Doug,

Yes prayers and spiritual guidance are certainly needed. Borrowing money usually entails being yoked to another. At this late hour of earth's history, once can only yoke to another if prepared to walk away from it completely - to lose it all on the turn of a dime.

The signs of the times haunt us daily, even preceding the Gulf oil spill. Wise SDAs have been given advance knowledge. The only safe home investment is deep in the country. EGW dwelt upon this theme at length. If you pursue the light on this topic you'll be on safer ground.

Job security is weak all over. California may have one of the most fragile economies on the continent. Real estate investment as speculation is warned against in EGW's work, but she has plenty to share on the virtues of country living.

Useful resources include:

'Country Living' (1946) a posthumous compilation by EGW, and another entitled 'Rural Economy' by Ken LeBrun.

There's also a fellow named Dave Westbrook of 'Back to Enoch' ministries who provides rural living advice and seminars.

[Jeannieb43]

"I could just wait till I graduate and get a good job then..." makes me worry that you're really too young to take on such a big commitment. Also, when you graduate [from college? from high school? from grad school?] you may find the perfect job in another location. You should not try to own property which is located farther than 30 min. drive from where you live; and you should not try to live more than 30 min. drive from your place of employment.

In other words, even with today's low interest rates, buying something just to be buying it could prove to be an albatross around your neck if later you find yourself needing to live elsewhere because of your career. If you're thinking you'd just rent out the property later on, you need to take a second or third look at the situation; because being a landlord of a property which is several miles distant from your home is usually a difficult situation for management purposes.

And I agree: don't buy property with somebody else whose financial style is different from yours.

I'd say there are too many red flags here, my friend. There will be other opportunities later on, when you're established in your career.

[GreatLakesGramma]

Plus, renting out a house with a mortgage on it is not only not profitable, in all probability it will cost you much more than you will take in from it. Insurance on rental property is much more expensive than homeowners insurance, because tenants do not generally take care of the place, and far more often they actually trash it. Property taxes are higher for rental property too, because it's considered income property.

Low interest rates is not a good reason to buy a house unless all other factors are such as would cause you to buy it even if rates were high.