Is 20,000 a lot of money to owe in student loans?...?
No it is not much dept. It is just below average. The average student owes $25,000 in loans as I read in an article on Yahoo homepage not too long ago. I owed $29,000 out of college in engineering and I wanted to pay it off fast. In the past year, I spent all my money on loans spending $700/month. Now I owe just under $21,000. The average person pays off their loans after 7-10 years. 10 years is the maximum they give you. I am trying to finish it within 4 years. I will just have to wait to buy a house or a newer car. With $20,000 loan, you will probably have a minimum payment of around $220 per month.
I have $30k cash. Is it enough to buy home on loan around the Bay Area?
Surprisingly, YES! It'll be close, but it's possible with adequate income and good credit.Even though the median home price around the Bay Area is about $1M and often require $200K in downpayment, there are still plenty of good single family homes in the South Bay, and especially San Jose, that are under $600K. A few months ago, I helped a friend of mine score a deal in a similar situation. He had a good income but only $27K in savings. At that point, most real estate brokers would gently suggest saving up a lot more or push for an onerous FHA loan, but I won't stand for it. FHA loans are crazy expensive and in any case, I'm always up for a challenge.So, I found him a nice 3 bed/2 bath single family house in north San Jose and got him a deal that allowed him to buy with only 5% down. We negotiated the deal at $20K below the asking price of $600K. So, at $580K, the 5% down was $29K. Normally, most loans at 5% down would require 12 months of reserves in addition to the closing costs which include 6 months of prepaid property taxes. That was another $55K he didn't have. Plus, he was still short even for the $29K down payment. However, with this loan program, the lender allowed the Seller to pay for the closing costs and there wasn't a reserve requirement. So, we got the Seller to finance all $8K of closing costs and got the lender to approve the loan based on the anticipation that he would get another two paychecks for the remaining $2K before we closed in 33 days. Believe me, it was a hairy ride, but in the end, he got a killer deal. The home appraised for $630K. He put down $29K and had only $500 left in his bank account after closing. If his income weren't rock solid, I wouldn't have cut it that close. As it stands, he's paying the same for his mortgage and property tax as he would have paid for the rent on a 2 bedroom condo, so he's not sweating at all. Plus, he's going to get a huge tax deduction refund as a homeowner.Since he gained $50K in instant equity at the close and is riding up the market, he's on track to refinance for a conventional 20% loan with no money out of pocket in about a year. Then again, he's only paying 3.25% interest, so he's in no particular rush.
What kind of home can I afford?
It depends on what the other expenses in your life are, such as credit cards, student loans and car loans. The normal debt-to-income ratio a borrower can get approved for is 41%. That means that all of your other debt, house payment, property taxes and insurance can't exceed $1,981.67. So, let's assume you have $300 in other debt. Property taxes of $4,000 annually and insurance of $650. You only have average credit so you'll probably need FHA financing with means around $150 of mortgage insurance. $1,981.67 (41% of your monthly income) - $300 (other debt) -$333.33 (property taxes) - $54.67 (insurance) -$150 (mortgage insurance =principle and interest payment of $1,143.67 FHA 30 yr. loans are averaging around 4.75% so that would allow you a mortgage in the amount of $219,000. This is within the limit allowed by FHA for Genesee County. Requirements: 2 year work history in same line of work, 640 credit score, 3.5% down-payment. You will need to be on the new job long enough to be able to provide the lender 30 days of paycheck stubs. Contact a lender directly to review your scenario since I am assuming a lot with the numbers I provided you!
Buying my first home?
I am frankly tired of renting homes and would like to buy my first home. How much income would I need to make? How does a mortgage work & how much/often would I need to pay on it?
What is the effective cost of combined loans?
Your second loan isn't 20k. its the difference between the remaining mortgage (after 5 years) plus your 20K deposit, and the 180K cost of the house. So 133,964 + 20,000 =153,964. Then 180,000 - 153,964 = 26,036 <== try that as the second loan amount ---- Think of it this way-the cost is 180k and you already have 20k saved up. The rest of the money (160k) will come from loans. The old loan is worth $133,964 today, so you just need to borrow another $26,036. ------- sorry for the delay, i calculate manually. well i almost got the correct answer but i did it a little differently. I did a value-weighted cost of capital (thats just fancy talk). Mortgage 1 = 133964 = 83.73% x Interest rate = .0875% = 7.33% Mortgage 2 = 26036 = 16.27% x Interest rate = .12.5% = 2.034% Total loans = 160k. = 100% Effective Interest rate = 9.36% I'm not sure what's going on with you calculator, but at least the process is right. ----- Well i'm only 3 hundredths off the correct answer (9.36), it can't just be a coincidence. I realised that I can't do this question without a graphics calculator since you're finding the interest rate. That's the only thing I can't do with manual calculations. You could try using n*25 like we did at the start o get the payments of $1151 instead of 1101.38. Plus the other payment of 283.88 gives you $1434.8. Try that. Fingers crossed. Sure email or IM me, I cant' promise anything though.
A mean of $70,000 and standard deviaiton of $20,000?
For each of these, you want to convert to the Z-values (normal disrtibution with mean 0 and standard deviation 1) which are probably in the back of your book. a) P(L>80,000) = P((L-70000)/20000 > (80000 - 70000)/20000) = P(Z > .5) = .3085 (In case you want more steps, P(Z > .5) = P(Z > 0) - P(0 < Z < .5) = .5 - .1915 = .3085. The .1915 is the number for 0.5 in the Z tables) b) P(65000 < L < 80000) = P((65000-70000)/20000 < Z < (80000 - 70000)/20000) = P(-.25 < Z < .5) = P(-.25 < Z < 0) + P(0 < Z < .5) = P(0 < Z < .25) + P(0 < Z < .5) = .0987 + .1915 = .2902 c) P(65000 < L) = P(-.25 < Z) = P(-.25 < Z < 0) + P(Z > 0) = .0987 + .5 = .5987 PS The first respondent gave the right answer for $90000 or more, but the requested $80000 is only half a standard deviation above the mean.