[urbanrealtor]

I would have to agree that the rental price represents a minimum price floor. In the really depressed areas the purchase option can be significantly cheaper even with a minimal amount brought as cash (think subprime parts of El Cajon or really any part of Chula Vista). However nicer areas seem to put that floor higher. That means you are break-even with rent at 10 or 20 or 30 percent cash.

I will use an urban example here. A 2-bedroom condo property in Hillcrest will sell for about $300k or so. It will rent for 1800-2000/mth. That means at 25% down, this will cash flow about evenly (depending on HOA fees). A property in Normal Heights of a similar character will sell for 220,000K and rent for $1600/mth. In other words it breaks even at almost nothing down. In this case you pay a value premium for the desirable location.

Boiling it down: What this means is you need to figure out what you have for a down and how close to rent you can bring your monthly payments. If you can find a place you like where you can buy and pay about as much in mortgage as you would in rent, then for christ sake’s, buy it.

Note: You will need a good loan officer (who is recommended and honest). Also, you will maximize your benefit by buying between September and February. That is when sellers are most stressed and likely to accept lower offers.

[urbanrealtor]

I would have to agree that the rental price represents a minimum price floor. In the really depressed areas the purchase option can be significantly cheaper even with a minimal amount brought as cash (think subprime parts of El Cajon or really any part of Chula Vista). However nicer areas seem to put that floor higher. That means you are break-even with rent at 10 or 20 or 30 percent cash.

I will use an urban example here. A 2-bedroom condo property in Hillcrest will sell for about $300k or so. It will rent for 1800-2000/mth. That means at 25% down, this will cash flow about evenly (depending on HOA fees). A property in Normal Heights of a similar character will sell for 220,000K and rent for $1600/mth. In other words it breaks even at almost nothing down. In this case you pay a value premium for the desirable location.

Boiling it down: What this means is you need to figure out what you have for a down and how close to rent you can bring your monthly payments. If you can find a place you like where you can buy and pay about as much in mortgage as you would in rent, then for christ sake’s, buy it.

Note: You will need a good loan officer (who is recommended and honest). Also, you will maximize your benefit by buying between September and February. That is when sellers are most stressed and likely to accept lower offers.

[urbanrealtor]

I really have to agree with HLS here.
Banks are not governed as tightly as brokers.
I have seen drama on virtually every loan handled by a bank.
I have also seen a crapload (technical term) of dishonest brokers.
Best example, there is a firm offering a “no closing cost” mortgage. The rate is about half a point above market. This is not what gets quoted when you walk into the branch. The loan officer is a salaried employee who handles dozens of loans a week. While this is good because he definitely knows his lending products, it also means he does not really care if a particular loan lives or dies. I recently had a conversation where one such employee complained that the loan he was handling was the smallest one he had handled that month and he implied he would sabotage the loan if my client needed too much hand-holding. Real nice. I have only ever dealt with one loan officer who has never given me issues ever. His name is Dave Espinosa. He is certified mortgage planner. (dave (at) sailwithdave (dot) com. He is not always the cheapest or the most salesy. However, he is consistently the most skilled and honest. And yes, he occasionally does interest only when the dollar amounts financial planning make sense.

[urbanrealtor]

I really have to agree with HLS here.
Banks are not governed as tightly as brokers.
I have seen drama on virtually every loan handled by a bank.
I have also seen a crapload (technical term) of dishonest brokers.
Best example, there is a firm offering a “no closing cost” mortgage. The rate is about half a point above market. This is not what gets quoted when you walk into the branch. The loan officer is a salaried employee who handles dozens of loans a week. While this is good because he definitely knows his lending products, it also means he does not really care if a particular loan lives or dies. I recently had a conversation where one such employee complained that the loan he was handling was the smallest one he had handled that month and he implied he would sabotage the loan if my client needed too much hand-holding. Real nice. I have only ever dealt with one loan officer who has never given me issues ever. His name is Dave Espinosa. He is certified mortgage planner. (dave (at) sailwithdave (dot) com. He is not always the cheapest or the most salesy. However, he is consistently the most skilled and honest. And yes, he occasionally does interest only when the dollar amounts financial planning make sense.

[urbanrealtor]

I really have to agree with HLS here.
Banks are not governed as tightly as brokers.
I have seen drama on virtually every loan handled by a bank.
I have also seen a crapload (technical term) of dishonest brokers.
Best example, there is a firm offering a “no closing cost” mortgage. The rate is about half a point above market. This is not what gets quoted when you walk into the branch. The loan officer is a salaried employee who handles dozens of loans a week. While this is good because he definitely knows his lending products, it also means he does not really care if a particular loan lives or dies. I recently had a conversation where one such employee complained that the loan he was handling was the smallest one he had handled that month and he implied he would sabotage the loan if my client needed too much hand-holding. Real nice. I have only ever dealt with one loan officer who has never given me issues ever. His name is Dave Espinosa. He is certified mortgage planner. (dave (at) sailwithdave (dot) com. He is not always the cheapest or the most salesy. However, he is consistently the most skilled and honest. And yes, he occasionally does interest only when the dollar amounts financial planning make sense.

[urbanrealtor]

I really have to agree with HLS here.
Banks are not governed as tightly as brokers.
I have seen drama on virtually every loan handled by a bank.
I have also seen a crapload (technical term) of dishonest brokers.
Best example, there is a firm offering a “no closing cost” mortgage. The rate is about half a point above market. This is not what gets quoted when you walk into the branch. The loan officer is a salaried employee who handles dozens of loans a week. While this is good because he definitely knows his lending products, it also means he does not really care if a particular loan lives or dies. I recently had a conversation where one such employee complained that the loan he was handling was the smallest one he had handled that month and he implied he would sabotage the loan if my client needed too much hand-holding. Real nice. I have only ever dealt with one loan officer who has never given me issues ever. His name is Dave Espinosa. He is certified mortgage planner. (dave (at) sailwithdave (dot) com. He is not always the cheapest or the most salesy. However, he is consistently the most skilled and honest. And yes, he occasionally does interest only when the dollar amounts financial planning make sense.

[urbanrealtor]

I really have to agree with HLS here.
Banks are not governed as tightly as brokers.
I have seen drama on virtually every loan handled by a bank.
I have also seen a crapload (technical term) of dishonest brokers.
Best example, there is a firm offering a “no closing cost” mortgage. The rate is about half a point above market. This is not what gets quoted when you walk into the branch. The loan officer is a salaried employee who handles dozens of loans a week. While this is good because he definitely knows his lending products, it also means he does not really care if a particular loan lives or dies. I recently had a conversation where one such employee complained that the loan he was handling was the smallest one he had handled that month and he implied he would sabotage the loan if my client needed too much hand-holding. Real nice. I have only ever dealt with one loan officer who has never given me issues ever. His name is Dave Espinosa. He is certified mortgage planner. (dave (at) sailwithdave (dot) com. He is not always the cheapest or the most salesy. However, he is consistently the most skilled and honest. And yes, he occasionally does interest only when the dollar amounts financial planning make sense.

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