Comments on: Daily Links: Money Problems and Buying a Home

By: allen

allen — Wed, 30 Jan 2008 00:13:53 +0000

JD: Why not submit to the interview yourownself? You’ve made a huge come-back, and could really sell the story, I am sure.

That being said: Home Warrenties. I know alot of people hate them, but even with my recnet PROBLEM with them, i am still ahead, i feel. Find out about the deductible, what is covered, &c. Even though it only covers big things, and with those deductibles, it will often cost that much just to get someone out there in the first place to look at it. I’m in my first home, and I am currently planning on renewing my home warrenty… but then again my place is like 50 years old!

By: Baker

Baker — Tue, 29 Jan 2008 22:46:51 +0000

I just talked to Lauren also. Very nice person. We’ll see if I hear back or not.

By: J.D. Fournier

J.D. Fournier — Tue, 29 Jan 2008 16:57:00 +0000

I had a home warranty too, but there was a deductible of $100, so only major repairs make sense, and you always still owe that $100 per repair. Second it only covers appliances. I doubt a $250 per year warranty is with no deductible also, if you have newer appliances you shouldn’t have problems with them every year.

By: Curtis

Curtis — Tue, 29 Jan 2008 16:56:36 +0000

I sent Lauren (at CNBC) a note yesterday and just got off the phone with her. She took some notes to share our story with her producer and said she’d get back with me if they wanted to do an actual interview!

By: Sandy

Sandy — Tue, 29 Jan 2008 16:19:07 +0000

Just a suggestion re the expense of home repairs. My realtor bought me a $250 home warranty pkg. when I bought my house, and it was wonderful. I used it to have my dishwasher repaired successfully, and my garage door. She has a rental property and has a home warranty pkg. for it. She said it’s wonderful. The tenants called her last week because the refrigerator went out, and the home warranty pkg. covered the expense to repair it. Why don’t we as homeowners look into having a home warranty pkg. for ourselves every year? Something to consider.

By: Ben

Ben — Tue, 29 Jan 2008 09:35:55 +0000

kc- that’s an interesting point! we bought our first home in Sept ‘06 for 160k. In the first 12 months we spent $2,100 in repairs (3 major repairs) and I felt like I got screwed by the previous homeowner fot not taking care of things as they came up. At least your point eases my mind a little. I still hate spending money though! ;(

By: RB

RB — Tue, 29 Jan 2008 05:57:22 +0000

I’m taking a look at the series in a moment. While we’re on the topic of home-ownership, the way I see it, there are two schools of thought:

1. Leverage your mortgage by financing it to the hilt, invest in a side-fund earning a higher rate of return than your current mortgage rate… All principles taught in “Missed Fortunate 101″ (the condensed version) and “Missed Fortunate”

2. Pay off your equity as soon as possible.

The first requires discipline. If you’re going to leverage your mortgage, it’s my humble opinion that you should be doing something constructive with it. I think everyone here will agree.

The second… Making accelerated payments towards your mortgage isn’t necessarily a bad thing. In fact, in light of today’s current market, it’s probably the wisest thing anyone can do. Property values haven’t appreciated at the fast rates we’ve enjoyed in prior years and they have deflated in many a market. Most people today can’t refinance due to a lack of equity (many homeowners are upside down). So you can see the benefit to sending accelerated mortgage payments; you have equity to benefit from a refinance IF necessary.

I’ll agree a lot of people might not have the luxury of sending additional payments towards their mortgage but all in all, we have to exercise more frugal spending habits.

By: KC

KC — Tue, 29 Jan 2008 03:41:54 +0000

Another tip I learned (financially) about buying a house is you should expect to spend about 2% of the cost of the home on annual repairs. In other words if you own a $100,000 home you’ll spend on average $2,000/year for repairs and such. I’ve found this to be pretty accurate - and my home costs more than $100k, sigh… So don’t forget about future repairs (as well as taxes and insurance) when you are figuring how much you can afford.

I also learned that the less you buy the easier it is financially, for more than just the obvious reasons. Sure it’d be nicer to have more closet space or another bedroom or bathroom. But by buying a smaller, less expensive home we have more money to use for other things. Also by having less house and less yard, not only does it costs less to mortgage, but it is less for me to clean, mow, rake, etc. If I had a bigger house or yard I’d probably have to hire either a maid or a lawn service.

By: RacerX

RacerX — Tue, 29 Jan 2008 03:10:27 +0000

It is so important to take responsibility for your own actions, it is the first step to overcoming!

By: Mrs. Micah

Mrs. Micah — Tue, 29 Jan 2008 03:06:18 +0000

Jaimie’s post was probably the best thing I’ve read all month.

By: paidtwice

paidtwice — Tue, 29 Jan 2008 02:14:30 +0000

Thanks so much for highlighting my post! Good luck figuring out what you want to do re: home ownership.