In order to participate in the GunBroker Member forums, you must be logged in with your GunBroker.com account. Click the sign-in button at the top right of the forums page to get connected.
Travis Made An Offer On A House
nunn
Forums Admins, Member, Moderator Posts: 36,083 ******
I sure hope it is accepted. He found this foreclosed house that has a bargain (I think) asking price. It is cheap because it only has two bedrooms, it is on a tiny lot, and it is in a not-so-great neighborhood. The house is only a few years old, and as far as I can see, its only problems are cosmetic.
The banker in the bank where I have my mortgage kept shining him on, never giving him a firm answer, so I called a loan officer at the bank where he and I have our checking and savings accounts. No problem...only I have to apply as co-borrower. Travis has zero credit, having never borrowed a dime from anyone. He would just has soon have kept it that way, but for the chance to be a homeowner at a very reasonable cost.
Bank offered him a 10-year loan at 7%. Not great terms, but it's all in-house, and pretty good for a kid with no credit, and no job. He is only borrowing around $25,000, and he intends to pay it back in five years, not ten.
Anyhow, the financing is in place; all we have to do now is see if his offer is accepted.
The banker in the bank where I have my mortgage kept shining him on, never giving him a firm answer, so I called a loan officer at the bank where he and I have our checking and savings accounts. No problem...only I have to apply as co-borrower. Travis has zero credit, having never borrowed a dime from anyone. He would just has soon have kept it that way, but for the chance to be a homeowner at a very reasonable cost.
Bank offered him a 10-year loan at 7%. Not great terms, but it's all in-house, and pretty good for a kid with no credit, and no job. He is only borrowing around $25,000, and he intends to pay it back in five years, not ten.
Anyhow, the financing is in place; all we have to do now is see if his offer is accepted.
Comments
I live by. I don't co-sign
for anyone,family or friends.
I'll give or loan them enuff money
to satisfy the bank but I never co-sign.
If they can't buy it on their own they don't
deserve it. There are many ways to build up
credit if they choose to. Life is a journey
not a race.
Travis is your son that was/is (sorry lost track) in the Army, right?
would USAA or the VA be a better route for a lower rate?
The rate is higher than market, but it is about all he can expect, and he got it done in minutes, not months. Keep in mind, he has NO CREDIT, and NO JOB, and his co-borrower (me) filed for bankruptcy in 2004.
Also keep in mind that this is an in-house loan, not second-tier. No FHA, no VA, no Fannie Mae, no Freddie Mack. He borrows from the bank, and pays back the bank.
If he pays the loan back in five years as planned, the difference between 5% and 7% isn't enough to lose sleep over.
Back when I lacked credit you could do a "low doc" loan (low documentation)) with 20% and very little qualifying.
The first credit card I ever applied for was Texaco and they turned me down. Shell accepted me at the same time and conditions. Now I can have pretty muchy whatever credit card I want, and I have been sent dozens of pre-approved Texaco cards over the years, but I'll never have a Texaco card - they wouldn't give me a chance, I won't give them one.
Merc
quote:Originally posted by nunn
If I had $25G setting where I could get to it, I would front him the money on a handshake. Travis is that kind of man. But, my money is tied up in my retirement account, so I can't help him myself.
The rate is higher than market, but it is about all he can expect, and he got it done in minutes, not months. Keep in mind, he has NO CREDIT, and NO JOB, and his co-borrower (me) filed for bankruptcy in 2004.
Also keep in mind that this is an in-house loan, not second-tier. No FHA, no VA, no Fannie Mae, no Freddie Mack. He borrows from the bank, and pays back the bank.
If he pays the loan back in five years as planned, the difference between 5% and 7% isn't enough to lose sleep over.
He should look for a 3 BR 2 BA in a decent neighborhood. Reason being is if he decides to move in a few years the house will be much easier to sell and he won't have to sit at work and worry about his family's safety, worrying will make you old, fast. He's lucky enough to have a cosigner he's in good shape. aaaaif the best terms he can get is 10yrs at 7% take it and refinance a year or so later when he has good credit. Good idea to pay it off in half the time too, when bankers get their thieving little hands on less of your money its always a good thing.
Always get a home inspection, if a house has a good structure the rest is fixable. Houses are out there that have been forclosed on and can be had at a good price.
Who the heck said anything about a family? That's a ways down the road, after he has this place paid for, and rented out.
if his income is steady and adequate, i dont see how thats not employment; and if its not steady, then i dont see how he(or you) thinks its a good idea to be on the hook for a mortgage.
then again, this one wont cost me a penny either way, so i guess go for it.
i do find it ironic that you're the forums pimp for dave ramesy and now you're both advocating and cosigning for a mortgage.
Even in this market, he is not going to find a 4-year-old, 3 bedroom, 2 bath home in nice neighborhood for $35,000.
Who the heck said anything about a family? That's a ways down the road, after he has this place paid for, and rented out.
Oh OK if thats a plan, other than the headache of renting to other "people" he should be fine.
Dave Ramsey does caution against co-signing a note, but that's the only way the bank would do the note. I wouldn't consider it, except I know Travis will pay the note, and I know the house will be a good investment. Once Travis pays on it for a year or so, he can re-finance it all by himself. Dave does not have a problem with a person taking out a mortgage, for no more than 15 years, with payments no more than 25% of his take-home pay.
I don't do everything Dave says. For instance, I do use gasoline credit cards, and I do have one Mastercard that I use only for on-line and phone purchases. On no card will I maintain a balance; everything is paid off when the bill comes.
I do not have a car note, and I will not.
Everyone has their own individual situation. While I'd never co-sign anything for anyone, you're in your own situation and know your son better than a banker or any of us.
I came on a little strong.
You and I are different people.
I've seen in my lifetime
even in good times so many
people left holding the "bag"
for whatever reasons.I re-read
my post and it sounds like I'm
slighting Travis. Far from it.
I'm sure all will be fine.
Ronny
nunn -
Travis is your son that was/is (sorry lost track) in the Army, right?
would USAA or the VA be a better route for a lower rate?
+1!
I say go for it. Good way to start off in life with a house paid off in a few years.
If I had $25G setting where I could get to it, I would front him the money on a handshake. Travis is that kind of man. But, my money is tied up in my retirement account, so I can't help him myself.
The rate is higher than market, but it is about all he can expect, and he got it done in minutes, not months. Keep in mind, he has NO CREDIT, and NO JOB, and his co-borrower (me) filed for bankruptcy in 2004.
Also keep in mind that this is an in-house loan, not second-tier. No FHA, no VA, no Fannie Mae, no Freddie Mack. He borrows from the bank, and pays back the bank.
If he pays the loan back in five years as planned, the difference between 5% and 7% isn't enough to lose sleep over.
If the math adds up do it. Small note with quick pay off and he will have a place to stay on the cheap and some equity to use in the future. He will payout less in interest than he would in rent.
I wish him the best with it.
We have found a 3/2 on 1 acre with a in ground pool for $30k, good deals out there just got to check the banks lists.
why not wait until he can afford a nicer one, have more cash in hand, and not live in a ghetto?
Former Member U.S. Navy Shooting Team
Former NSSA All American
Navy Distinguished Pistol Shot
MO, CT, VA.
Doesn't sound too bad if the deal is fixed at 7% for 10. Probably cheaper in closing costs as well. The mortgage game is a volume one and the people who borrow more money get a better deal than the small ones.
I would also recommend being a co-owner as well as a co-borrower like forgemonkey. Good luck to you and your son, this sounds like a good start.
KC
According to the loan officer, I will have to be a co-owner. I didn't want to be, but so be it. More incentive for him to make good on his obligation.
BTW, he called today and his offer was accepted.
... and it is in a not-so-great neighborhood....
... pretty good for a kid with no credit, and no job. He is only borrowing around $25,000, and he intends to pay it back in five years, not ten.
I threw up the red flags that caught my attention.
If the neighborhood is not so great now. What will it be like in 5 or 10 years. You see 99 neighborhoods get worse and more rundown each year to 1 that is improving.
No job.. Look at the Job market now. What guarantee does he have at getting a job that will allow him to pay all of his bills plus a house payment for the next 5 years?
Get a job first. Save some money to put down on a house then go to the next step.
Not knocking your son in no way, form or fashion.
It just seems like he is setting himself up to fail by wanting to become a homeowner to quickly.
So when you gonna get the boy hired on with the PD department?
Seem his military experience would help.
Ought to be something he could do around there to get a foot in the door.
also, congratulations to him. always makes me happy to see somebody doing well for themselves.