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Discussion Starter · #1 ·
Ok i'm a long time reader, but hadn't been posting... though whats the point of that! LOL so anyways... me and my dh have sold our land/home it's an acre of land with a moblie home on it, nice but with three active kids in school we wanted closer to town...

We have a nice chunck of $$ for a down payment on something but wondered if we should pay off our car loans first then we would have less on our credit report ? and have a much less of a down payment or use the whole down payment on the house since we will get a better credit rate doing this and the home loan will be 30 years vs the only 2 years and 5 years left on our car loans...

Also we have the option of either looking and looking and looking for a home that we will love for the rest of our lives... or our inlaws have a nice 3 acre lot right on the edge of town said they would give us some of thier land we could then add the land to our down payment and get a modular or manufactured home that we could then get exactly what we are looking for... We don't really have a set time of getting out of our trailor we are in now since it's my grandparents buying it from us for our dad... but we want to start looking and are homing to be in a new home by christmas or right after the new year...

Thanks so much for the help!!!
 

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Unless you are really close to a lender's limits on debt/income ratios, I think it's unlikely that paying off your car loans will affect your credit score very much. What a lender will do is add up your total monthly debt payments and compare it to your monthly income. From when we last did this I remember they wanted your mortgage to be no more than 28% of your net income and your total debt to be no more than 40%. Some lenders are more conservative.

You can get the best rates and avoid PMI (private mortgage interest) added to your monthly payments by having at least 20% down. Anywhere between 5-15% down doesn't seem to matter one way or another. Like you can get as good a rate with 5% down as 15%. We got a loan where we put only 15% but we didn't have to pay PMI (I'm not sure why not?).

The point I am trying to make is, for deciding whether to pay off your car loans or not I would look at how it affects the amount of down payment you can make. If it takes you from being able to comfortably make a 20% down payment to only being able to make 10%, it might not be worth it. But if it is only going to take you from say 10% to 5%, and make your monthly cashflow a lot better, it might be worth it after all.

Good luck!
 

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Discussion Starter · #3 ·
The down payment we have now is about 25% of the home price range we are looking at, if we payed off our cars it woudl only be about a 15% down... so i guess it will be better to use it all for a down payment that is what we though but just thinking about all options.
 

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"or our inlaws have a nice 3 acre lot right on the edge of town said they would give us some of thier land we could then add the land to our down payment and get a modular or manufactured home that we could then get exactly what we are looking for..."

Thats a great option! My dad had deeded us 4 acres of his land for free, and we would have been able to use the ful value (About $25,000.00) as down payment equity. One snag is that some lenders like you to have the land for a year (They call it seasoning), but we found several who would full value it in 6 months!

That could allow you to put less actual $$ down, but still get the house you want! (We were going to go modular also and custom designed our dream house)

Good luck! How great to be able to take your time and find exactly what you want!
 

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Discussion Starter · #5 ·
Quote:

Originally Posted by caeden&connersmom

Thats a great option! My dad had deeded us 4 acres of his land for free, and we would have been able to use the ful value (About $25,000.00) as down payment equity. One snag is that some lenders like you to have the land for a year (They call it seasoning), but we found several who would full value it in 6 months!
I didn't relize this... we got the land we used as a down payment on the trailor and it was farm land 1 acre with NOTHING on it and were able to use it as a down payment... guess it's something eles to check into. If we had the land (i have no clue what the value would be... about 3/4 of an acre w/ trees, ect) and the 25-30% cash down payment i bet we could get just about ANYTHING we wanted... w/ in reason... i mean we have 3 kids so wanted a 4 bedroom home w/ livingroom/dinning room/eat in kitchen/ oh we have to go looking soon... just thinking about it makes me so happy!!
 

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Personally, I would stick with having at least 20% down plus several thousand over that for the misc. costs associated with closing (e.g. about $5000).

Lenders will typically look at your total debt payments per month (e.g. house note, car loans, credit cards) and will want your total payments to be less than 33-40% of your income. I can't recall the title of the particluar book I used, but there are a lot of very good books out there on home buying which might be worth checking out.
 

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Discussion Starter · #7 ·
our car payments and doulbe our house payment now is still less then 40% our income... so i think we will be ok... plus our inlaws think they might want to buy our car that has 2 years left on the loan and just take over payments, so it will still be on my dh's credit history but not mine and he's the co signer on the car not the signer if that matters his dad is the co signer b/c he bought that car before i was 18 when i was pregnant with our second child and his dad helped him with a car loan now we have an suv that we owe 5 years one that is in my name and dh's name...
But we really don't need 2 cars b/c with dh's new job a car and gas are paid for... so we really need to get rid of a car anyways... you guys have been such great help!!! thanks again!!! keep suggestions coming!
 

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You can generally avoid PMI with at least 10% down by doing an 80/10/10 - 10% down, 80% first mortgage, 10% second mortgage (equity line of credit). My lender explained it to me this way - you can do a 95/15/5 (5% down) but the lenders see that as you not having enough money and hike the rate on the HELOC - but with 10% down, you get a much nicer rate on the HELOC but still avoid PMI. I prefer to put 20% down though, HELOCs have a higher interest rate than regular mortgages and probably higher than your car loan.

Keep in mind that PMI will apply until you own at least 20% of your house. However if the house goes up in value you can get it re-assessed and the PMI removed. So, although it may seem like putting down less than 20% is the same as putitng 5% down its not - you will not be paying PMI for as long if you put more down, though you will still be required to pay it. Does that make sense? Really, PMI is expensive, you should avoid it if you can. It would not make sense to pay PMI to be able to pay off a car loan unless maybe if it was a very expensive or high interested one.
 

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I thought we were going to do that 80/10/10 thing you described, mightymoo, but somehow it turned out to be 85% loan/15% down...which meant at the last minute we were kind of scraping because it took every last penny we had to make that 15% (plus the closing costs etc). We literally had about 37 cents in the bank until I got my next paycheck
. But we also don't pay PMI and I still don't know why not.
 

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Quote:

Originally Posted by moms3kids
our inlaws think they might want to buy our car that has 2 years left on the loan and just take over payments
That sounds pretty good....you will have better cashflow without reducing your available down payment.
 

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Discussion Starter · #11 ·
Thanks again so much for all the help me and dh are going to take the kidos over to my sil's when ds get out of his first day of school then we are going to go look at modulars and manufactured homes... any know the differance, i'm sure the house place can tell us just wondering others opinions!
 

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To answer your question about manufactured homes. Most modular/manufactured homes seem like a great deal -- lots of square footage for a lower price than a traditionally built home.

But, the biggest issue I have with them is that the majority of them depreciate in value. Try and find a manufactured home for resale that costs more than it did originally (don't include the land value). And, most of the ones I've seen have quality issues over time. They don't last near as long as they should for the price you pay.

The types of modular homes that I'm interested in that are built in the factory, disassembled, transported to your land and then reassembled on a foundation cost more than traditionally built homes. These are the ones that will appreciate in value and I'm just waiting for the day when the cost to purchase a new one is more in line with a new traditionally built home.

HTH.
 

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This site explains the difference between mobile/manufactured/modular. In short, a "manufactured" home is the type where pretty much the entire structure is assembled in a factory and then delivered to the land. These tend to look like a "mobile home" or "trailer" even if they are not actually in any sense mobile (i.e. they've been placed on a permanent foundation).

A modular home OTOH is a structure where various portions were assembled in a factory, transported to the property site, and then assembled into the final structure. Ryan Homes is probably the most well-known builder of modular homes and if you take a look at that site you will see the homes look nothing at all like mobile homes. They can actually be quite upscale.

I don't know much of anything about the resale value, but there is apparently some stigma regarding modular homes as not being the same quality as what is called a "site-built" home. A very good friend of mine works for a modular home builder and says that stigma is entirely unfounded. She says that the quality control in a factory setting is higher than out on a building site. Also that framing of walls and doors etc have to be built to more exacting standards because the panels are ultimately to be shipped anywhere in the country, so they have to be built to the toughest building standards that are in effect anywhere, not just to whatever codes may be in effect in one particular locale.

ETA: I didn't know that modular homes cost more than site-built...I thought the main selling point was that they cost less...but I admit I don't actually know one way or the other.
 

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True! A manufactured house is a mobile home. Think trailer or double wide. Typically built with 2x4 and paneling inside instead of drywall. Depriciate quickly adn to almost no value. Typically not on a foundation, just a slab and "tied down"

A modular home is built with 2x6, same as a site built, drywall, etc etc. A lot of modulars are actually built better because they are built in a factory under climate controlled conditions and the materials are not exposed (Think when you drive by a house being built and its framed and raining! All that plywood, wood etc is getting wet!) A modular has to be built to cover all building codes, so someone was right, they build them to exceed most.

In our area, it *is* cheaper to buy modular as construction costs are through the roof right now. The biggest price saver on a modular is to go with a stock plan and not make changes. I designed our house and had them price it out as a modular and even that came in under what it would cost to build! (Complete with cathedral ceilings, hardwood floors and custom lights and cabinets)

Another thing to consider is who you buy it from. Some places add on $40,000 or $50,000 for things that are not covered, oil tank, septic, well, electric meter, etc. The place we were going to deal with covered everything in their price, including front steps (Can you believe most modular dealers DONT include that!)

Anyway, shop around!!! If a modular looks too good to be true, ASK what is extra!!!!
 

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Discussion Starter · #15 ·
Well we went and looked last night and talked with my grandparents who looked before we started looking but ended up just buying a home from a 'for sale buy owner' and they talked to a very very good friend of thiers is a ( on the name totally spliped my mom mind) lady that comes in and tells you what your home is worth... the value... i can't think of it... anyways she said that a modular NOT manufacutred home is worth resale as much as a stick built home... There is NO way we can aforid to build, prices aren't pretty around here!!! We do care that we get the most and just what we want for our $$ but we really aren't the worried about resale, we do plan to live in this home at the very very least till our children are very grown with thier own kids!


we have about 3-4 models that we LOVE!!! now it's just to get the ball rolling to see if we can get into something before chirstmas!! Lots to do and so little time! lol Again thanks to everyone that has helped me with some of these issues, ideas!
 

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Discussion Starter · #17 ·
Quote:

Originally Posted by wednesday
A home appraiser

Thanks, i don't know why it sliped my mind but it did! LOL

Ok so have some ?'s about floor plans... Any suggestions... we have three that we are debating the place we looked is in IL and is said to be the largest manufactured/modular home dealer in the mid west (not only by them selfs but many many other have said that as well). So anyone what to help look at the plans and help me think of anything that is not so good abou the lay out???

#1 http://www.rileyhomes.com/redman/redman-XT3280.htm this is the outside picutres. http://www.rileyhomes.com/pdf/redman-XT3280-01.pdf and here's the floor plan!!!

#2 http://www.rileyhomes.com/dutch/dutch-DT3280.htm outside http://www.rileyhomes.com/pdf/dutch-DT328003and04.pdf this is the floor plan but it would have the 'ultimate kitchen' that is shown of page 2 of the floor plan

#3 http://www.rileyhomes.com/dutch/dutch-DT3280-11.htm outside http://www.rileyhomes.com/pdf/dutch-DT328011.pdf and floor plan
 

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I only looked at the floor plans and I am a little green with envy. We bought our first home a little over a year ago and have learned a lot since then about how we'd like our floor plan to be vs what we have.

I liked the 1st and 3rd floor plans best, because if you're staying a long time then the separation of the master bedroom from the others will be, imo, useful for privacy when everyone is older. The only downside in the first floorplan (vs. the 3rd) is that I couldn't picture a quiet place for one kiddo to study if people in the living/family room were watching a movie, or playing music, etc. In the 3rd floor plan, having that sunken activity room on the other side of the bedrooms means that activities can be more separated from the dining/living room area.

Anyhow, good luck and congrats!
 

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#3 is nice cause you can have an adult area of the home (The left side) and a childrens area (The right) The huge family room would be a plus in my book! You could carve out a nice niche in there to set up a homework area.

#2 - I LOVE the master bedroom retreat! I think every adult needs a room to escape to!

#1 - Least favorite. Doesnt seem like a good floorplan, everything is too "separate" and boxy, IMO.

If I HAD to choose one, it would be #3.

Good luck and have fun picking out a new house!!!
 

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Discussion Starter · #20 ·
Ok maybe i should add my opinions also!!!

#1 is much less onsale ($20K) the the others as it's onsale and the bedroom and quite large enough to accomidate all the kids stuff in thier own rooms... down is there isn't much seprating the livingroom and family room...

#2 LOVE the large open kitchen with lots of room and able to see in most of the home from there. there are three bathrooms but not an easily ecessible one for the guests we might have over with out walking through a bedroom or utillity room.

#3 like it, bedroom are alittle small but the activity room could be a partcial play room. Bad thing is the kitchen (were i seem to spend 4 or so hours a day is far away from where i think the kids would spend most of their time (activity room). I do really like the activie room a lot as much of our family time woudl be spent there and the mess of kids kept there and a nice formal livingroom for when people stop by.

My family is me(23), Dh (27), ds (6), dd (4), dd (2). DD 2 still sleeps with us but that's only for a few years... the others stay in thier own beds almost all night eveyr night.
 
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