Getting gifted a decent amount of money, can I afford a house?

[cheyennebrown]

@snervel You lost me at “girlfriend’s parents”. Not sure what a house costs (too much to read), but it doesn’t seem you have a lot of assets outside of this gift (I think you have $13k).

Owning a home is expensive; property tax, insurance, maintenance, etc. A new roof, furniture, broken pipe, etc. can easily blow through your $13k.

I understand the feeling of paying rent towards your own home. But, there is more to it than rent vs. mortgage. Buying a home now, especially before you GF even has a job, getting married, etc. will be a financial disaster in the making.

 

[snervel]

@cheyennebrown Even though you didn’t read the whole post this is very helpful feedback! 13k is my 401k though so couldn’t even touch that, I do have 20k in saving though.

Wonder what feedback you have on townhouses and paying an HOA?

 

[cheyennebrown]

@snervel $20k isn’t much more. But, really depends on housing market you are in. When we bought our fixer upper in Los Angeles, we spent ~$25k for new windows, roof, and electrical panel (not rewire). This was over ten years ago, so it’s only gotten more expensive!

Not a fan of HOA’s. If you hate rent, HOA’s are a similar equivalent that generally goes up over time. But I’m also a DIY’er so yard work, painting, etc. is a hobby to me.

 

[snervel]

@cheyennebrown 20k was a lot for little ole me (kidding kinda). Based off her responds from her job applications more than likely Forest City Iowa, Detroit Michigan, and Jacksonville Illinois are the markets we would look at. All have median homes prices of under 200,000k

 

[cheyennebrown]

@snervel Practice patience in your purchase. I’d suggest renting for a few years to really determine the area or neighborhood you want to settle. A 30 mortgage is a commitment and if you blindly buy in a relatively unknown area, unwinding a purchase could prove expensive.

You both are very much young and have plenty of time. Don’t rush just to keep up with where you think you should be.

 

[tparkinson012]

@snervel Do not buy a house with someone you are not married to. Ever. She has a small down payment gift, and cannot afford a home because she needs a job after graduation and you don’t have enough to afford a house on your own, so therefore no house. You don’t seem to understand the true costs of owning a home, a mortgage being the least amount of money you will ever pay vs renting and I don't feel you have enough money to afford one. You want a car, a second car, a wedding. Lawyer costs for immigration a run into the five figures. Put the money away, wait until you are married and settled and your then wife has a job and then start looking. The housing market will still be there when you both are more settled. Don't jump into something that may be wrong, you can’t afford or might not fit your life in a few years just because housing prices are rising. They always have. It’s not an impulse purchase.

 

[snervel]

@tparkinson012 Though I agree and appreciate the feedback I’d disagree on the small down payment. Most people in my area use half or less then half of what we have the opportunity to do. A friend I know used 11k as a down payment for a brand new build!

The rest i will take the feedback into consideration really helpful feedback! Thank you

 

[tparkinson012]

@snervel Forgive me, sometimes I am clouded by the VHCOL areas, I did want to add even before your comment, You and your gf should be extremely proud of a generous gift that is well deserved (studying for her master), and proud at 24 to have saved $20,000 from hard work. You both have bright futures. That is extremely admirable and I’m very happy for you because most people your age are in debt or don’t have the financial sense to save anything. But as an elder millennial who has bought three homes now, it’s a lot. No matter where the home is. A water heater, roof leak, so many things even a great inspection can’t account for could wipe out all that hard earned money. You both obviously will be married and doing well. Enjoy renting for a bit while you settle. While I love owning a home, I do miss those times I could call a super in the building for any problem I had instead of it coming from my pocket I wish you both the best of luck.

 

[snervel]

@tparkinson012 Really appreciate the comment! Yes it seems like a lot of people are saying a lot of the same things about the cost of owning a home not being all about the monthly payment for it! Def something we are considering, I think the only way we will buy a home is if she ends up getting a job in the current area we live in. Since we know and love this are and would want to stay for as long as we are able. Thank you!

 

[lidzia]

@snervel I can’t believe parents actually gift this amount of money. Good for you!

 

[snervel]

@lidzia You and me both! My dad was never around and my mom mad 12k a year until she passed away while I was in school. Very fortunate to have met these people! They arnt even wealthy, (while I guess now they are) housing prices just went so high and they bought a remote home in the middle of no where for retirement using cash, so when they sold in there area their ROI was insane.

 

[cherylkiwi]

@snervel You are making this way too complicated ….. Get married first … Then look for a house together and put in both of your names

 

[snervel]

@cherylkiwi Like the comment, short and simple (unlike me) Any reason to put in both of our names? Since her family is putting down a pretty much the whole down payment I actually don’t mind the idea of it being “her home”. If we end up splitting year in the future I’d simple just need to find a new location (which is a hassle, but I always plan for catastrophic events such as this). I might be missing more details though and love the any information you have!

 

[cherylkiwi]

@snervel Once you are married all assets are combined. There is no more mine or hers. Regardless of where the down payment came from. The quicker you learn this the quicker you two will become extremely wealthy together.

 

[tanga]

@snervel I personally say go for it, depending on your housing market. I’m a 23M in my first year post college, making roughly the same amount as you, and I just pulled the trigger by myself on a 183k home (LCOL city). Made sense to me as my mortgage payment is exactly same as my previous apartment’s rent+utilities. It all just depends on if the numbers fit your budgets.

 

[snervel]

@tanga Thanks for the feedback! A lot of my friends around my age, younger, making less or the same as me pulled trigger and they seem a lot more happier. They just stopped going out as much and started having people over instead (which is awesome). I do think the monthly payment will be fine, I do worry abt the fixing, and Maintene of the home though.

Would you say you have had a lot of Maintenance expenses?

 

[kickthichphattiren689]

@snervel In regards to maintenance costs, every home is different. If you buy a newer home you’ll have much less maintenance to be done compared to a 25-30 year old house. I bought a 3 year old house and really the only major thing was the AC leaked out and that was like $3,500. But if you need a new AC or roof on an older house that will be a bunch of money.

 

[joannemaree]

@snervel I would get your girl friend’s immigration status settled before buying a house. Don’t go the DIY route - get an immigration attorney.

 

[snervel]

@joannemaree She has a visa cause of school and gets another year on top of that (paper work should be finished next month). Not sure how long our green card will take though once we go to the court house. We won’t be DIYing the papers, a friend of mines father owns his own immigration law firm. Hoping to have this all settled before actually buying/closing

 

[rosie99]

@snervel I would wait for her to be fully employed and married and a citizen. You need stability via employment via settled marital status and via national citizen ship.

I would advocate for a new build, new everything and under warranty. I’ve had many friends struck by foundation, old HVAC, and even squirrels destroying the attic/roof in a 1988 and a 1960s build houses. The couple in the 1960s need to still drop 10gs for new windows but didn’t have the funds after paying for HVAC and foundation repair.

It’s a risk, but if you have cash or access to cash then you can solve problems.