[audio-pals] Re: Older Houses

  • From: Thomas McMahan <thomas.mcmahan@xxxxxxx>
  • To: audio-pals@xxxxxxxxxxxxx
  • Date: Thu, 12 Mar 2015 07:37:33 -0500

That’s fine, keep a couple of hundred around in your first year though in case 
you get a surprise when the actual tax bill comes around and you should be 
okay, just in case it’s a little higher than what they first tell you it will 
be.  That us usually the most common surprise in the first year of a house is 
the tax bill.  Some people have had some rather rude surprises in fact 
depending on how the previous owners handled or didn’t handle their tax 
situation because at least in Illinois in your first year you are paying the 
previous year’s taxes.  So in May we will get our tax bill for 2014, then there 
will be a schedule for when to pay if we want to pay in full as one amount, or 
to pay it in two amounts which is what we usually do, one in June and the other 
around First of September, but we have paid the one lump payment in July 
before, of course different Counties and Cities do it different and at 
different times of the year, It’s just that they become due in Ford County in 
July unless a person opts to do the split payment method which plenty of people 
do.  Also if it was a rental unit your first year’s taxes will be higher too, 
then they drop off the following year so check on that too.  Well that’s the 
way it works here.  Yes our’s was rented, but we had been warned about that so 
not a surprise, just a larger tax bill in that first year.  

I would figure you both would have done this budgeting idea you tend to be 
fairly careful about stuff, but never hurts to say.  Home ownership does have 
it’s little surprises sometimes.  But it sure is nice when it’s all your’s too 
*lol*.  Surprises or not, but by that time you will be used to the routine of 
things braking down and being landlord and fixing them *lol*.  

> On Mar 12, 2015, at 5:40 AM, Josh <lawdog911@xxxxxxxxxxx> wrote:
> Well, before we decide that any house is the house we want, we make sure that 
> we can afford it with the rest of our bills. As far as escroe goes we have 
> not discussed that so that is something that we will have to discuss as the 
> time draws near. As I read on down through your email it appears that we have 
> discussed the whole escroe aspect. We definitely have had each payment 
> considered with tax and insurance in mind with the payment.
> From: audio-pals-bounce@xxxxxxxxxxxxx 
> <mailto:audio-pals-bounce@xxxxxxxxxxxxx> 
> [mailto:audio-pals-bounce@xxxxxxxxxxxxx 
> <mailto:audio-pals-bounce@xxxxxxxxxxxxx>] On Behalf Of Thomas McMahan
> Sent: Thursday, March 12, 2015 4:58 AM
> To: audio-pals@xxxxxxxxxxxxx <mailto:audio-pals@xxxxxxxxxxxxx>
> Subject: [audio-pals] Re: Older Houses
> I accidentally hit the send before cleaning up that mail darn it.  
> Here’s another little exercise to work on.  Lets say you guys decide to go 
> for this house.  You should have a ballpark of the monthly payment.  Sit down 
> and plot out a budget around it on one paper, as well as a list of possible 
> repairs to do on another list and their costs.  Yes a house payment can be 
> cheaper than rent, but their are other realities such as the taxes, and 
> insurance.  Are you going to escrow your insuranc and tax payments into your 
> house payment?  Most people do that and it usually works out well until they 
> assess your house taxes up and then you have to make up the short fall.  Of 
> course if they assess them downward you get a chunk of money back in the mail 
> like my sister-in-law has done the past two years.  I didn’t escro my other 
> payments.  I deal with insurance as I would any other utility, and we would 
> do our taxes on our own.  Because of that I now pay my insurance once a year 
> and it’s cheaper, and once the house was paid for there was less entanglement 
> with the bank.  I even removed the automatic withdraw for house payment 
> because they double dipped us a couple of different months, and didn’t have a 
> very good explanation as to why.  So it put us into over draw land, which 
> isn’t a place you want to be.  They did the same to my sis-in-law too and she 
> went in and practically threw a fit because she wasn’t working at the time 
> and didn’t have income yet.  They refunded her money on that one, but as she 
> asked them, “now how am I supposed to pay the rest of my bills?  You think 
> you guys are my only bill to pay?”  Banks and their computers can be sloppy 
> sometimes.  
> Now when you do your budget here’s another game to play which may be 
> beneficial.  Can you run your whole budget on one income?  Everybody that 
> lives as a couple should do this whether renting or paying for a house.  Most 
> of us find we can’t, but it is a nice goal.  The guy we had going along with 
> us to check out houses etc and sort of pointed and guided us along through 
> the process gave us that little bit of wisdom.  As he said, what happens if 
> Pat loses her job and can’t get one very fast?  Can you live on just your 
> income alone, because if you can get to that point, then you can start paying 
> extra against your house on it’s principle and have more paid off faster 
> which is good for the credit rating, but if you decide to move in 20 years 
> you are carrying less of a load thus will get more money back to leverage 
> against your next place should you decide to do that.  Or you can both pay 
> some extra on house and car, then put the rest in the bank against major 
> repairs which are going to come even if you buy a house that was built today, 
> in 30 years you will have to had to replace things, they just don’t build 
> stuff that good anymore and sometimes that includes homes btw.  
> Lots of decisions, but at least it looks like you guys aren’t just jumping 
> right and grabbing what shines in front of you which is good.  
> Btw, I don’t think our budget is currently within the lowest income level of 
> the house here at this time which would be Patti’s income, although it’s not 
> way above that amount.  It is a good goal to work for actually, so we will be 
> able to start seriously working on this place.  Get a lot of little stuff 
> done over time, then do a loan down the road and fix the major stuff such as 
> re doing the roof etc.  I don’t think I am going to lift the house and work 
> on foundation, but it would be nice to do actually.  
> But it’s a good exercise to do.  I would run it on your income Josh because 
> it is likely to always be there and Amanda’s income is the variable one, it 
> can be lower if she’s out of work, but can also be a lot higher should land a 
> great paying job.  Drop in everything, credit cards the whole deal, then 
> figure out once you get to where you’re going which angles to cover and get 
> paid off in the budget.  
> I am guessing you guys have done some of this already though in preparing for 
> checking out the housing market and talking to lenders because they are going 
> to do roughly the same thing when checking your credit etc.  Especially if 
> it’s a conservative bank.  
> Now I think I’ve completed all I was going to say.  Took two e-mails, but if 
> I had been able to clean up the other one first it would have fitted into one 
> probably *lol*.  
> Instead you get two.  
>> On Mar 12, 2015, at 3:34 AM, Thomas McMahan <shadowmonstrosity@xxxxxxx 
>> <mailto:shadowmonstrosity@xxxxxxx>> wrote:
>> Wouldn’t worry about a house on market for 5 months.  Most around here are 
>> on a year or so.  To many deals fall through each time that happens that 
>> just adds more time that the house is sitting there.  Age, is only a problem 
>> if the house hasn’t been kept up and modernized over the years.  There are 
>> people who prefer older houses simply because they are more solid.  The 
>> house I live in was placed here in 1922.  Yes it came from somewhere else.  
>> The house next door is older and was also brought in here from another place 
>> too.  Fairly common in a town that springs up by a railroad.  I wouldn’t 
>> worry so much about that as apposed to how it’s fundamentally built, there 
>> are a lot of newer places that are likely to give you just as much trouble 
>> if not more.  
>> Any house is going to have ongoing mantainence of some kind.  Sided house 
>> are nice but siding fades over the years for example and eventually would 
>> need replacing.  Wooden houses have their things that have to be done, and 
>> so would brick, but brick is the best option as far as I’m concerned accept 
>> maybe when a big earthquake comes, then I would favor a wooden house, but 
>> what are the chances of that huh?  
>> I don’t know the market down there anymore so don’t know if that is a low 
>> ball figure on that house or not, but I can tell you it is larger than mine 
>> is and mine is two stories, but so is it’s price too.  
>> Go through it with a fine tooth comb with the idea of what has to be fixed 
>> now, and then in the next 5 years and what would be ongoing over the years, 
>> I don’t think for the long term ongoing it will be much different than a 10 
>> year old house verses the 60 year old house, but agin it is a matter of what 
>> would immediately have to be worked on.  When was the house last occupied 
>> too?  A house that hasn’t been occupied for a good while can have problems 
>> such as drainage because they haven’t been flushed etc.  It sounds like you 
>> already have someone with you who knows how to examine a foundation well and 
>> give you an idea of what would have to be done and when which is good.  Same 
>> with tuck pointing brick etc.  
>> It may be sitting on market because folks think it’s to high also, but you 
>> are going to drop in a price and they will take it or leave it, or you both 
>> the buyer and seller will eventually come up with something in the middle, 
>> or the seller is going to have an empty house on their hands. 
>> What heating and cooling does it have, and when was it installed too that is 
>> a factor, a 30 year old furnace is getting kind of old in this part of the 
>> world, but most of our furnaces are gas and they do have to work pretty hard 
>> for a good part of the year.  Does it have any chimnies, and where do they 
>> run through the house.  Ones that run through centers of houses on the 
>> surface are nice, but when they have to be worked on they are a lot more 
>> work.  Of course where you live a lot of homes are electric heat and 
>> electric water heat, which is another thing to add to your check list, how 
>> old is the water heater and when will you be replacing that.  A brand new 
>> house obviously you would get to wait a while before doing that, but chances 
>> are you would have to do it eventually, or have your price knocked down when 
>> you are selling it, or when your descendants are selling it.  But that goes 
>> with any house again.  
>> What neighborhood is it in?  How accessible is it to you.  Pretend Amanda 
>> had to leave town for a Month and start your math, what is easy to get to 
>> via walking etc.  Maybe that isn’t a problem for you at this moment, but 
>> life can always hand you changes, and well, next thing you know, you are 
>> walking to the grocery store if you know what I mean.  
>> Find out what their highest bills were for each utility in the last year it 
>> was occupied if you can, you need that in planning a general budget.  I 
>> don’t know your property tax situation anymore, but here they just give an 
>> estimate from the seller, but the problem is, that if the sell lived in the 
>> house for a long time you might get a little surprise when the annual taxes 
>> come.  Our’s wasn’t a surprise because the previous owner hadn’t lived or 
>> owned the house for to long.
>> So it becomes also a matter of do you get a house that you won’t have to do 
>> any work or as little work as possible on, verses one that may have to have 
>> some work done, or one that is a fixer upper.  We bought a fixer upper, but 
>> when we bought it was a seller’s market, it definitely isn’t that nowadays, 
>> so we went for a house we knew we could likely get.  Well the trade off is 
>> that it’s needed work done on it and still does actually, but likely we 
>> would at least get some money back when we sell it.  Maybe not a lot but 
>> probably some when all is said and done, and of course the sell of this 
>> place could be the lverage to getting a better place.  It’s probably what 
>> you parents did, if not them then your grand parents did, that is more the 
>> normal thing in history.  Well up until recently where you have people who 
>> expect to buy a brand new house that is larger than what their parents owned 
>> as their first house.  Well if it can be swung, go for it, but to me it’s a 
>> little unrealistic, well to my income level it is *lol*.  
>> What appliances are already there, and how quickly do you think you will be 
>> having to replace say: stove, washer, or more of a bear dishwasher?  What 
>> about cabinetry etc, is Amanda happy with that, having that done can also be 
>> expensive unless you have someone who works with you to give you a break.  
>> How much stuff will you guys do on your own for modifications verses having 
>> to hire outsiders.  So yes the advantage of a new place is that you won’t 
>> have to do that, but I guarantee you will pay up front for that, but that is 
>> why newer houses don’t stay on market long.  
>> So then it falls back to degree of work and mantainence that has to be done. 
>>> On Mar 11, 2015, at 9:41 PM, Josh <lawdog911@xxxxxxxxxxx 
>>> <mailto:lawdog911@xxxxxxxxxxx>> wrote:
>>> Hello,
>>>   We are finding tons of older houses that we absolutely love. When I say 
>>> older I am talking 1950’s. I am struggling with this a bit though because I 
>>> am looking ahead, past when I am living there. Or rather to the point that 
>>> I am ready to not live there anymore. So, when I get to the point of not 
>>> wanting to live there anymore it could be 10, 20, 30 or more years down the 
>>> road, but I am sure there will come a time that I am ready to move on. If 
>>> this is not the case and I stay there until I die then it is not a concern, 
>>> However, a 1950 house that I live in for 20 years will then be 85 years 
>>> old. I know the specific house that we are looking at has been on the 
>>> market for right about 5 months. So, what do you all think, do you think I 
>>> would have trouble selling an 85 year old home? It is on the market for 5 
>>> months at the age of 65 years old. It is right about 112,000.00 right now 
>>> without negotiating a lower price. Do you think I would be able to get my 
>>> money back? If it is not a major concern, the age of the house, then I will 
>>> not let it sway my decision, but taking into consideration that it is an 
>>> all brick rancher with over 1700 sq. ft. and it is almost 100,000.00 and 
>>> still on the market concerns me regardless how beautiful the house seems 
>>> right now.         

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