add adjacent vacant land to existing home

[nextwife]

Yes...the RESPONSIBLE use of an A.R.M. is fine! Obviously you are one of the few that understands it and are responsible about it. A 1% cap per yr. is GREAT too. Typically only F.H.A. has this (a 1% annual cap).
The a.r.m. problems of today are not your RESPONSIBLE type nor the F.H.A. a.r.m.s it is the 2 yr. and the 3 yr. fixed with a 6% cap that CAN actually go up the entire 6% when they do adjust.

Which makes the problem not the concept of an arm, but the choice or arm based upon the situation. And the unwillingness of many buyers to move through the "starter to intermediate" home steps and accumulate equity before moving up. I saw too many buyers who had to jump right into the whole big shebang, rather than building up equity and buying up eventually. And using their homes as ATMs, rather than working toward pay down their debt.

I still maintain that arms themselves are NOT evil. And I still recommend that people talk to local, vested-in-the-community brick-and-mortar lenders. The apparently "cheapest deal" is not necessarilly the best deal. I keep my loan partially because of the ability to walk into a local bank branch, make my payment (along with that extra principal payment I always make) and walk out with my new balance receipt in hand.

 

[Grandma's house]

Amen! Words to live by.

Unfortunately most people don't think about (or prepare for) what may happen (worst case scenario) 5 or 10 years down the road. As our current economy and mortgage forclosure rates are showing us.

I am STILL picking my jaw up from the floor over that hud. lol
You and Nextwife need to talk...I don't care HOW good that arm is...if you can share with Nextwife where you got that loan...she/he (have never figured that one out, sorry N.W.) really ought to consider it. In today's market and very low rates you cannot go wrong.

 

[Grandma's house]

Which makes the problem not the concept of an arm, but the choice or arm based upon the situation. And the unwillingness of many buyers to move through the "starter to intermediate" home steps and accumulate equity before moving up. I saw too many buyers who had to jump right into the whole big shebang, rather than building up equity and buying up eventually. And using their homes as ATMs, rather than working toward pay down their debt.

I still maintain that arms themselves are NOT evil. And I still recommend that people talk to local, vested-in-the-community brick-and-mortar lenders. The apparently "cheapest deal" is not necessarilly the best deal. I keep my loan partially because of the ability to walk into a local bank branch, make my payment (along with that extra principal payment I always make) and walk out with my new balance receipt in hand.

quote: And using their homes as ATMs, rather than working toward pay down their debt

Good one...because that is exactly what people have done.

you wouldn't by chance have one of those "home accelerated mtg. programs" do you? The mortgage IS actually tied to your checking. You actually pay down the bal. with EVERY deposit? Pay bills off of it as usual? It's new to US as a lender but are going into training on it soon. It began in Europe and is getting pretty big here.

I am always very leary of these NEW loans we get trained in. Such as the pay option arms that are a paymt. based at 1% These are nearly ALL in foreclosure.

Personally, I WOULD really like to see us all get back to OLD school regarding mtgs. and credit cards. Remember when using a credit card was for an emergency? When trying to pay your house OFF was the GOAL in life? What in the heck happened to America?

*******Here it is...I found what I was talking about. This IS the new wave coming down amongst us lenders. These NEW loans scare the you know what out of me. The last time it was the Neg. Am's that were suppose to be so good.
Here is where I will be in FL. training on. www.homeownershipaccelerator.com This is suppose to BE the very best loan EVER. We will see. (sigh)

Happy Easter all.

 

[nextwife]

My accelerated amortization consists of nothing more than kicking in extra money toward the principal each month. Pretty simple.

 

[jpathfynder]

The only mistake I think you made was paying off that car of 14k. While it may feel GOOD now...lower payment and all...that car will be LONG gone within 30 yrs. and you will still be paying on it. In fact the avg. car is kept 5 yrs. you will be thru 5 more cars and still be paying on this one. However with the deal you just got on your mtg....WHO CARES.

Good Job.

I debated the car for over a week I never even thought of it until they brought it up. I know it wasn't the smartest move, but in my defense it lowered my total payments from $1,050.00 to $549.00. I already have an auto-payment setup for $650 (extra 100 bucks a month off principal) and will be paying $2,000 off the balance this Wednesday (I'm in my 3 day RoR until then).

I ran the numbers a while back, that 2k down up front and that 100 bucks/mo will payoff the car and have my balance as if I never did the car in less than 7 years I think. Not optimal but I also have an extra $400.00 bucks a month to play with

 

[Grandma's house]

Well...if you ARE in your 3 day R.O.R. and since you are still kicking yourself for this...
Call your guy tomorrow. Get the rate and payment of a 15 yr. mtg. 1.) the rate will be lower, he CAN use the same lock date he used for the 30 yr. term 2.) you are already use to paying out X amt. per mo. with the car RIGHT??? 3.) STILL payoff the car of course...but get the numbers on the 15 yr. fixed. Then do the bi-weekly to pay IT down even quicker.
You may be very surprised that there is not that much differential in the paymt. AND think of your retirement age and getting it paid off. If you have a 5.25% 30 yr. fixed then the rate should be 4.75% on a 15 yr. Close enough. ALL the lender has to do is get it back into underwriting a few hours at worst a couple of days.

 

[jpathfynder]

Ok I ran 2 separate loans.

Mortgage 1 (my loan)
30yr, 5.25%, $99,250, P&I $548.00

Mortgage 2 (my loan without the car -$14k)
30yr, 5.25%, $85,250, P&I $470.75

Paying $2,000 down, and $650.00/mo on mortgage 1 vs. $470.75 on Mortgage 2, the balances are equal in Feb 2015. (6 years and 11 months) Mortgage 2 also gets paid off 9 years 7 months early, so it's basically a 20 year loan.

Well...if you ARE in your 3 day R.O.R.

You'll notice the date on that HUD (at the bottom) is 3/21/08 Friday. I believe I have until next Tuesday at midnight. Hell I even tried to waive my R.O.R and they wouldn't let me.

Call your guy tomorrow. Get the rate and payment of a 15 yr. mtg.

Well.. another important aspect of a 30 year obligation is peace of mind. I live in Michigan which has a tanking economy due to the auto industry and loss of manufacturing jobs as well as being in the top 10 list for most forclosures. I like having the option of those low payments if times happen to get tough. I'm trying to balance common sense, financial sense and security.

 

[justalayman]

Ok I ran 2 separate loans.

.

You also hijacked drewkobi's thread with your own situation.

 

[jpathfynder]

My accelerated amortization consists of nothing more than kicking in extra money toward the principal each month. Pretty simple.

Pretty simple and Pretty smart. I do it too. It gives you the option in an emergency to go to the minumum payment amount.

you wouldn't by chance have one of those "home accelerated mtg. programs" do you? The mortgage IS actually tied to your checking. You actually pay down the bal. with EVERY deposit? Pay bills off of it as usual? It's new to US as a lender but are going into training on it soon. It began in Europe and is getting pretty big here.

They're starting those here as well. They call them zero balance mortgages, atleast the advertisment I hear. They tie a checking account into your mortgage, everyday at midnight they sweep the balance of your checking onto your mortgage, reducing the principal balance, thus reducing your interest. When you write a check that amount is added back onto your mortgage balance. They claim 70% of all mortgages in Europe are done this way. I don't see these working in the U.S., we're credit idiots... but, then again 20 or so years ago I didn't think rap music would catch on either, so who knows!

 

[Ozark_Sophist]

Did you have to combine the 2 parcel #'s into #1 parcel #? This would have taken a complete re-surveying, stakes and everything to do. You should not have had to do this at all. Later down the road, you may want to sell that parcel and or build on it, a separate residence. However you would have to pay down the mtg. for the percentage the appraiser gave to that portion of the land value to get them to release it VS. doing a complete refi. This can be approved by the lender at time of the buyers approval and all be done at one closing so no out of pocket to do this from you. (so remember this)
Also that appraisal merely included both parcel numbers correct?

Two parcels = One loan.

Survey required regardlessly as the land we bought was from a larger parcel.

 

[Grandma's house]

Absolutely, I have seen as many as #4 parcels and the appraiser coming back missing one and had to make him go back and redo it. lol

Title work too, I've picked up where there was 3 parcels on the appraisal, yet the title work was missing one.
Gotta get all the ducks to match.