Buy a GTR or a House?

birdmanx1 · 09-10-2011, 11:00 PM

Quote:

Originally Posted by b1adesofcha0s

Hmm great advice and I find this especially helpful for myself. How long after getting a new job should you wait before buying a house (which will be my first major purchase)? How much would be a year's worth of emergency funds? My situation is a little different though. You and Steve already know this, but I'm gonna be finishing school in May and hopefully will land a nice engineering job right afterwards. House is definitely the first major purchase, no questions about it. I live with my parents and they have emergency funds saved up, plus their own incomes. I will probably be paying for the house by myself with both my parents incomes being saved up for emergency funds. Appreciate the advice

Also planning to buy a GT-R after a couple years on the job and after having settled into the house

My best recommendation is to go with at least 12 months of living expenses. The best advice I can give you is to live like a college student for the next 5 years after your graduation. In that timeframe your income will double and easily triple, you will get more out of your dollar (less charges, no children, no mortgage...) If you get used to leaving not just beneath but way beneath your means anything extra should easily go towards retirement, IRA/mutual funds accounts, stock brokerage accounts, emergency funds, and other investment activities. Automation is your friend.

Don't rush to buy a house for the sake of buying one; my personal rule for the mortgage is that it should be less than 28% of your biweekly paycheck and always count your income not that your spouse/GF/parents. Don't listen to real estate sales people, they have the worst financial ethic, (trust me I know a few and the kind of interests they are paying on their own home) Living way under your means gives you piece of mind and ensures you to save for what's more important long term all the while giving you rooms for personal trips all over the world

birdmanx1 · 09-10-2011, 11:04 PM

Quote:

Originally Posted by b1adesofcha0s

Yeah that's kind of what I was planning on. Should I pay off the car first or just use that money for the down payment of house? I was also thinking about transferring the car to my name after I get full time work and I can get a loan. This way I can start building up my credit since I will be the main person on the loan. I have a better credit score than both my parents right now, but am lacking in credit history.

Well it depends, are interests earned on your own investment > than the ones you are paying on your car? Do you have credit cards debt?

Pay off credit card debt first given the typical high interest then move down the ladder with the highest interest debts. At the end of the day things are easier when you ensure that your inflows are always higher than your outflows; credit card companies, banks are NOT your friends, keep that in mind and don't hesitate to tell them to get lost when they offer you lines of credit you don't need.

b1adesofcha0s · 09-10-2011, 11:06 PM

Quote:

Originally Posted by birdmanx1

My best recommendation is to go with at least 12 months of living expenses. The best advice I can give you is to live like a college student for the next 5 years after your graduation. In that timeframe your income will double and easily triple, you will get more out of your dollar (less charges, no children, no mortgage...) If you get used to leaving not just beneath but way beneath your means anything extra should easily go towards retirement, IRA/mutual funds accounts, stock brokerage accounts, emergency funds, and other investment activities. Automation is your friend.

Don't rush to buy a house for the sake of buying one; my personal rule for the mortgage is that it should be less than 28% of your biweekly paycheck and always count your income not that your spouse/GF/parents. Don't listen to real estate sales people, they have the worst financial ethic, (trust me I know a few and the kind of interests they are paying on their own home) Living way under your means gives you piece of mind and ensures you to save for what's more important long term all the while giving you rooms for personal trips all over the world

Outside of the Z, I live a pretty conservative lifestyle (spending wise) compared to most college kids and I don't see that changing really, it's just how I am. Obviously I'd have to find out where I will be working and what my salary will before I decide. If we were to get the same house we were aiming for last year (or at least similar price), the mortagage is only a few hundred more per month than what my parents are paying for rent. That's what really annoys them most and why they want to buy a house ASAP. They can afford one, but just couldn't get approved for the loan.

b1adesofcha0s · 09-10-2011, 11:10 PM

Quote:

Originally Posted by birdmanx1

Well it depends, are interests earned on your own investment > than the ones you are paying on your car? Do you have credit cards debt?

Pay off credit card debt first given the typical high interest then move down the ladder with the highest interest debts. At the end of the day things are easier when you ensure that your inflows are always higher than your outflows; credit card companies, banks are NOT your friends, keep that in mind and don't hesitate to tell them to get lost when they offer you lines of credit you don't need.

No credit card debt now and never will be, I'm smart enough to keep it that way. Car payments are very low ($185/month) and interest isn't too bad either. Don't know what those will be like if I get it under my name though. Just want to know if I should have the car completely paid off by the time I apply for a home loan or if that money would be better spent towards the house's down payment. Only have $10k left on my car loan.

birdmanx1 · 09-10-2011, 11:19 PM

If you are trying to build credit, having a payment history helps. To be realistic, you won't have built enough credit a year or even 1.5 year away from now for banks to give you a loan on your own. Car loan won't be a negative if debt/asset ratio is low. Applying for a credit card with low limit now would be a good start and paying it monthly would help establish credit history. For a loan, banks don't only rely on your actual credit score, your FICO score often takes highest precedence in their decision. I'll give you all the beans when I talk to you/see you. I'm out baller

b1adesofcha0s · 09-10-2011, 11:20 PM

Quote:

Originally Posted by birdmanx1

If you are trying to build credit, having a payment history helps. To be realistic, you won't have built enough credit a year or even 1.5 year away from now for banks to give you a loan on your own. Car loan won't be a negative if debt/asset ratio is low. Applying for a credit card with low limit now would be a good start and paying it monthly would help establish credit history. For a loan, banks don't only rely on your actual credit score, your FICO score often takes highest precedence in their decision. I'll give you all the beans when I talk to you/see you. I'm out baller

Thanks bro, appreciate it! Repped for all the help, you to Steve.

Lemers · 09-11-2011, 03:37 AM

I've Been in my career for 11 yrs on and still haven't bought a house. Of course the first 7 were overseas and another one deployed (Iraq). I wanted to buy here but decided against. I planned on staying just 2 yrs it looks like it will be 2.5 yrs and my next station only a year. Then I want to go overseas again ( Europe, figures crossed). My problem is I don't stick around long enough to build equity.

ZCarMan · 09-11-2011, 06:42 AM

In this economic downturn we are in, only in a very few places such as D.C. do you see some homes actually appreciating and that is mostly in the city itself. With all the foreclosures on the market and those set to go into foreclosure, combined with the fact banks are not lending to anyone but to those with the best credit, for many it may not be a good time to purchase a home. If I were going to purchase anything in real estate it would be a duplex or condo to rent out. More and more are forced to rent today which for a lot of folks isn't a bad thing. My rule of thumb, "If it isn't bringing cash flow in, it's sending cash out". Couple of books worth looking at, "Rich Dad, Poor Dad" and "The Millionaire Next Door".

Isamu · 09-11-2011, 01:28 PM

Quote:

Originally Posted by b1adesofcha0s

No credit card debt now and never will be, I'm smart enough to keep it that way. Car payments are very low ($185/month) and interest isn't too bad either. Don't know what those will be like if I get it under my name though. Just want to know if I should have the car completely paid off by the time I apply for a home loan or if that money would be better spent towards the house's down payment. Only have $10k left on my car loan.

having a credit card isn't a bad thing, its actually GOOD to have one one your credit report.. I have a "really good" credit score. and part of that is due to a credit card..

but as everyone has said. Buying a house is an investment. ESPECIALLY in todays market. here in ND, sadly it's a sellers market... so prices are high, like big city prices. and my city has 30k people... lol
with that said, 250k now will net positive returns in a few years.

Quote:

Originally Posted by ZCarMan

In this economic downturn we are in, only in a very few places such as D.C. do you see some homes actually appreciating and that is mostly in the city itself. With all the foreclosures on the market and those set to go into foreclosure, combined with the fact banks are not lending to anyone but to those with the best credit, for many it may not be a good time to purchase a home. If I were going to purchase anything in real estate it would be a duplex or condo to rent out. More and more are forced to rent today which for a lot of folks isn't a bad thing. My rule of thumb, "If it isn't bringing cash flow in, it's sending cash out". Couple of books worth looking at, "Rich Dad, Poor Dad" and "The Millionaire Next Door".

this is mostly true, however, home values and land values are still going up, it just happens that in a lot of areas people aren't buying because they can't get the loans.. so people are selling cheaper then what their homes are "worth" which is an awesome thing IF you are a buyer

Isamu · 09-11-2011, 01:33 PM

Quote:

Originally Posted by Lemers

I've Been in my career for 11 yrs on and still haven't bought a house. Of course the first 7 were overseas and another one deployed (Iraq). I wanted to buy here but decided against. I planned on staying just 2 yrs it looks like it will be 2.5 yrs and my next station only a year. Then I want to go overseas again ( Europe, figures crossed). My problem is I don't stick around long enough to build equity.

ok, I know you won't be around, but buy, and then rent to a family who works in your "company" then you can build equity, and still own a home, and eventually = profit

tjlazer · 09-11-2011, 02:00 PM

Quote:

Originally Posted by bacalhau16

Kinda a weird question, but thats where Im at. I got a pretty good job, but have only been there for about 3 months and its going well. Im not in love with it, but pay is good, sooo.....
The house is a foreclosure with a few unknowns. But its dirt cheap at $126k. Pretty large, 4 bedroom, 2.5 bath that needs a little cosmetic work. Some new flooring and paint and things of that nature.
So, I love cars and have always wanted that serious premier sports car, but realize that at my age, 27, perhaps I should be thinking of the future. But man the present is too fun to think far ahead.
So, what would you do?

A house is the smart answer. You already have a 370Z so it's not like you don't have a nice car, and you don't own a house so get the house.

Maybe later on you can get a used 2009 GT-R for cheap. An $80,000+ GT-R is just not worth it unless you are filthy rich. And if you can get a house for a little more than the car, the house is a much better choice. And like it was pointed out you could sell the house a lot easier without losing a lot of money than a used GT-R. And hopefully make a profit when the housing market bounces back up (lets just hope it does and fast...)

JZ370Z · 09-11-2011, 03:33 PM

My first thought is too hold off on any purchase until you are comfortable in your job. Once you are settled, BUY THE HOUSE! Now is a great time to buy a home. You can always buy the car when you are settled and feel you can afford it.

tjlazer · 09-11-2011, 06:48 PM

well the thing of it is, it's not like he is going out to spend big money and splurging on unneccessary things while only being on the job for 3 months. He is getting a home. If he doesn't buy it he has to pay rent, so the not buying anything because he is only on the job for 3 months mentality isn't really valid. On a GT-R? Yes it is--big time. Like was said, now is a great time to buy! In 6 months or a year the prices and interest rates go go much higher. (hope they do I need my equity to go up!)

tjlazer · 09-11-2011, 06:53 PM

Quote:

Originally Posted by birdmanx1

Don't rush to buy a house for the sake of buying one; my personal rule for the mortgage is that it should be less than 28% of your biweekly paycheck and always count your income not that your spouse/GF/parents. Don't listen to real estate sales people, they have the worst financial ethic, (trust me I know a few and the kind of interests they are paying on their own home) Living way under your means gives you piece of mind and ensures you to save for what's more important long term all the while giving you rooms for personal trips all over the world

Sounds nice and all, but damn who actualy makes that much to keep their mortgage under 28% of their BIMONTHY income! (That's what you meant right? Never heard of getting paid twice a week unless... lol) Hell, if you can keep your mortgage with tax and insurance under your BIMONTHY pay check you are doing good!!!

Rui Z · 09-11-2011, 07:03 PM

Screw the house. You don't need something that big. I'm assuming you are single. Get a GT-R and a 1 bedroom condo (with a garage) instead.

09-10-2011, 11:19 PM	#20 (permalink)
birdmanx1 A True Z Fanatic Join Date: Jun 2010 Location: Baltimore, MD Age: 95 Posts: 3,175 Drives: 370z Nismo Rep Power: 24	If you are trying to build credit, having a payment history helps. To be realistic, you won't have built enough credit a year or even 1.5 year away from now for banks to give you a loan on your own. Car loan won't be a negative if debt/asset ratio is low. Applying for a credit card with low limit now would be a good start and paying it monthly would help establish credit history. For a loan, banks don't only rely on your actual credit score, your FICO score often takes highest precedence in their decision. I'll give you all the beans when I talk to you/see you. I'm out baller __________________ 370Z NISMO #0462 \| ClearBra \| 3M tint \| Head/Taillights \| Dynamat \| Black Roof \| Tommy Kaira HB \| CF Parts \| Berk HFCs \| FI SS \| NST Pulleys \| Takeda aFe \| K&N \| H&R Spacers \| Swift Spec R \| SPC F&R \| Zuperman M370 Nismo Vid \| Nismo Journal \| Nismo Rumble

09-11-2011, 03:37 AM	#22 (permalink)
Lemers A True Z Fanatic Join Date: Mar 2010 Location: Izmir, Turkey Posts: 15,371 Drives: 2012 Traverse LTZ Rep Power: 52	I've Been in my career for 11 yrs on and still haven't bought a house. Of course the first 7 were overseas and another one deployed (Iraq). I wanted to buy here but decided against. I planned on staying just 2 yrs it looks like it will be 2.5 yrs and my next station only a year. Then I want to go overseas again ( Europe, figures crossed). My problem is I don't stick around long enough to build equity. __________________ 2010 Black Cherry Touring/Sport/Nav Now - 2012 Travese LTZ until I leave for Turkey

09-11-2011, 06:42 AM	#23 (permalink)
ZCarMan A True Z Fanatic Join Date: Jun 2009 Location: MD Posts: 4,488 Drives: 09 Z34, 13 F-150 Rep Power: 26	In this economic downturn we are in, only in a very few places such as D.C. do you see some homes actually appreciating and that is mostly in the city itself. With all the foreclosures on the market and those set to go into foreclosure, combined with the fact banks are not lending to anyone but to those with the best credit, for many it may not be a good time to purchase a home. If I were going to purchase anything in real estate it would be a duplex or condo to rent out. More and more are forced to rent today which for a lot of folks isn't a bad thing. My rule of thumb, "If it isn't bringing cash flow in, it's sending cash out". Couple of books worth looking at, "Rich Dad, Poor Dad" and "The Millionaire Next Door". __________________ Jon Swift \| SPC \| Stillen \| Motordyne \| AAM \| Cobb \| Hawk \| Volk Racing \| Bridgestone Green Demon Eyes

09-11-2011, 06:48 PM	#28 (permalink)
tjlazer A True Z Fanatic Join Date: Dec 2009 Location: Tacoma Age: 53 Posts: 2,496 Drives: Z34, R35 Rep Power: 20	well the thing of it is, it's not like he is going out to spend big money and splurging on unneccessary things while only being on the job for 3 months. He is getting a home. If he doesn't buy it he has to pay rent, so the not buying anything because he is only on the job for 3 months mentality isn't really valid. On a GT-R? Yes it is--big time. Like was said, now is a great time to buy! In 6 months or a year the prices and interest rates go go much higher. (hope they do I need my equity to go up!) __________________ 2009 370Z Monterey Blue,Nismo Conversion,RE-11's, K&N Typhoon intakes,Blue Kickplates,Homelink,FI 18" CBE,ERZ HFCs,Hotchkis sways, Swift Spec-R, EVO-R Highwing, UPREV

09-11-2011, 07:03 PM	#30 (permalink)
Rui Z Track Member Join Date: Feb 2010 Location: (.)(.) Posts: 931 Drives: 8====D Rep Power: 16	Screw the house. You don't need something that big. I'm assuming you are single. Get a GT-R and a 1 bedroom condo (with a garage) instead. __________________

09-11-2011, 03:33 PM	#27 (permalink)
JZ370Z Base Member Join Date: Sep 2011 Location: Ohio Posts: 9 Drives: 2011 370Z M6 Rep Power: 14	My first thought is too hold off on any purchase until you are comfortable in your job. Once you are settled, BUY THE HOUSE! Now is a great time to buy a home. You can always buy the car when you are settled and feel you can afford it.

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