> >>my son was told by his bank that they could get him a loan for a
> >>house for $245k. he makes $13.50/hr. WTF?
> >>
> >>ARe these people completely off their rocker?
[...]
> Total cost: $22,048 of which $1996 is a subsidy from the tax man.
> That's a net $2.47/hr into his pocket -- about $100/week for beer and
> chips, call it $411/mo.
>
> So I'd say they are off the rocker, but not completely batshit crazy.
> Maybe he could get a roomate for $600/mo and drink imported beer.
Assuming they are offering him some kind of reasonable package, and not one of these interest-only things that *assume* continued bubble-type growth so you can refi later, that kind of mortgage - and I'm assuming nothing down and 6K seller help to cover closing costs - would get a house like this in my neighborhood:
http://www.zillow.com/HomeDetails.htm?zprop=9771869
That is actually a really nice place. 500 sq ft bigger than mine but the lot is slightly smaller.
If he was planning on staying put for 4-5 years, it might be worth it. This is a college town, so if he had 3 other roommates going to school here, he could really make out.
I would have had to have been a lot more interested in fiscal responsibility and less interested in beer, as Jordan puts it, to make such a decision at 18.
Sure there is a nefarious side to the bank's offer in that they are after his business. But an ethical mortgage provider is no worse than an ethical landlord.
A member of my family is in this business and she often does mortgages for people in their late teens, early 20s, but they are more like $90K row homes versus $200K+ 4 BR homes in the college town.
I understand why many on this list reject home ownership because of the notion of private property ownership, but a lot of working class people seem to want to be home owners.
My lending bank is way less of an asshole to me than my landlords were. The bank's worst offense is trying to convince me I should borrow more money from them. After being told "even though it is 105 degrees and extremely humid, A/C is not considered a priority system to repair" and "someone will come within the week to exterminate the wasps that are living in the vents and coming in to your apartment each day", I'll take the bank.
I fucking hated renting. How is a mortgage any more oppressive than a lease agreement? Mine required 90 days notice of *NOT* renewing and you could only leave when a lease expired. I gave them 60 days notice I was moving out and they told me I was *NOT ALLOWED* since it wasn't 90 days and my lease wasn't expired yet.
I said "fuck you, assholes, sue me" and dropped the keys on the office manager's desk. They didn't.
Matt
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