UnThreaded | Threaded | Whole Thread (96) | Ignore Thread Prev | Next
Author: Rayvt Big gold star, 5000 posts Top Favorite Fools Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 127262  
Subject: Re: question: down payment on my first home Date: 5/14/2013 3:11 PM
Post New | Post Reply | Reply Later | Create Poll . Report this Post | Recommend it!
Recommendations: 3
I am about to purchase my first house. ...
I want to rent it and maybe move in there in a few years.


Ho boy!!
Where are you getting your advice from?

This is your very first home purchase -- and you intend to rent it out -- and you don't currently live in the area (I'm guessing on this last bit)?

Unless you are very very very very lucky, you are going to be getting an expensive education. I suspect that there are a whole lotta things that you don't know--and you don't know that you don't know them.

First, as others have said, the terms for an investor loan are not as good as owner-occupied. Higher down payment, higher rate, higher fees.

In many areas (don't know about Miami) property taxes are higher for a rental house. Insurance is higher, too. It's no longer "homeowner's insurance" it's "fire insurance". I suspect that this is MUCH higher in Miami, what with hurricane losses, etc.

Then the rent amount. You claim $1700 to $1950. That's such a wide range that it leads me to believe that you don't really know what it can rent for -- you are just guessing or relying on a realtor. Hint: realtors lie about how much rent you can get, and how easy it will be to rent.

It doesn't seem like you have taken into account vacancies and maintenance. A clogged up toilet isn't going to fix itself. The tenant will be calling YOU to fix it. If you will have to call a plumber, how much will they charge you?
Post New | Post Reply | Reply Later | Create Poll . Report this Post | Recommend it!
Print the post  
UnThreaded | Threaded | Whole Thread (96) | Ignore Thread Prev | Next

Announcements

Useful Resources
Our Home Center has all you need to make buying and owning a home a great experience. Get or refinance a mortgage and much more!
Buying/Selling a Home FAQ

Mortgage Professor
Offsite resource for mortgage questions.
Post of the Day:
Macro Economics

2.1: The Labor Pool Problem
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and "#1 Media Company to Work For" (BusinessInsider 2011)! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.
Advertisement