Comments on: Test Drive Your Home Ownership Experience

By: Personal Finance: The Week in Review # 4 - MoneyRemix

Personal Finance: The Week in Review # 4 - MoneyRemix — Sat, 28 Jun 2008 13:05:58 +0000

[...] Test Drive Your Home Ownership Experience A terrific idea if you’re contemplating the purchase of a home but aren’t quite sure if [...]

By: Joseph

Joseph — Thu, 26 Jun 2008 19:07:23 +0000

This is a fantastic idea! I can’t believe I’ve never thought of it before. I’ll actually be bringing this up to my wife… we’re looking at purchasing a home in about a year. It’d be good for us to know for sure if we can do it. I’ll let you know what happens with this!

By: skeptictank

skeptictank — Thu, 26 Jun 2008 00:15:59 +0000

If you’re going to buy a house I’d suggest a separate house emergency fund. I’ve started putting $150/week into my house emergency fund. The goal is have enough money in there for a large emergency like needing to replace a roof or needing to replace plumbing (lots of homes built in earlier times have galvanized pipes and there are cases where most all of the pipes need to be replaced at once – happened to a neighbor a few years back) – I’m aiming to have $15K in the house emergency fund. Again, this is separate from the 6-months-of-living-expenses emergency fund. You don’t want to find yourself in a situation where your roof needs to be replaced immediately and then have to put the $12K cost on the credit card.

As someone who has lived in the same house for 17 years now I can tell you that maintenance will be higher than you expect. Don’t get yourself into a situation where you can barely afford the monthly payments + insurance + property taxes. You need to be able to set aside money for maintenance as well. The rule of thumb that I’ve heard is 2% of your house’s value every year.

By: Kevin@ReturnToManliness

Kevin@ReturnToManliness — Wed, 25 Jun 2008 07:47:52 +0000

What a great idea on test driving whether or not you want to become a homeowner. In today’s crazy real estate market, there are so many people that will be renters for a long time.

The future homeowner really doesn’t know what they are getting into when they decide to buy a home until usually after they do it. This is huge mistake as it could ruin your credit for a long time if you make a bad decision up front.

By: Writer's Wallet

Writer's Wallet — Wed, 25 Jun 2008 00:58:31 +0000

Great way to get an idea of whether or not you’ll be able to handle it. Very conservative too. Me likey.

By: Pinyo

Pinyo — Tue, 24 Jun 2008 14:21:16 +0000

@Thrifty Femme — Good point about adjusting it for your local condition. For my house, the property tax is relatively cheap at about $3,000 for a $600k property. I know out in Long Island, taxes are about 3-4 times higher for the same $600k property.

@Sara — Thank you. And don’t forget emergency fund. As a homeowner, you can’t miss a mortgage payment so having an EF is more important than ever. I have 3 months worth of mortgage payment saved in a separate account just in case.

@Mr. Cheap — No problem.

@WealthBoy — Thanks!

By: WealthBoy

WealthBoy — Tue, 24 Jun 2008 12:09:42 +0000

Very good info Pinyo. I love articles that provide simple rule-of-thumb advice. It makes it very easy to follow and implement.

By: Mr. Cheap

Mr. Cheap — Tue, 24 Jun 2008 07:03:24 +0000

Great post and suggestion! Thanks for the link.

By: Sara

Sara — Tue, 24 Jun 2008 00:59:30 +0000

I’m impressed. This is a simple solution that makes sense (provided long-term job viability is there). Plus, you can use the money saved up to pay down closing costs, invest in new home costs like landscaping and blinds, or put down more on the down payment.

By: Personal Finance Buzz

Personal Finance Buzz — Mon, 23 Jun 2008 18:21:03 +0000

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