Throw me a bone. So, after doing more research (we're still buying a house... or planning to), I've realized some things aren't as good as they seem. Matt and I qualify for more home than we want to purchase, so no problems there. Since we're first time home buyers, we also qualify for as low as 5% down on a 30-year fixed conventional mortgage. However, if you put less than 20% down, you're required to have mortgage insurance (PMI). No big deal... it's now tax deductible, so it's not a big deal to me. Alternatively, you can do an FHA loan, but the max loan amount is $346,000 and it's more expensive money (read: higher interest rate and up front cost), but you don't have to pay PMI. Here's the kicker and the thing you don't hear about... although any lender is willing to give us a 95% LTV (loan to value) mortgage, mortgage insurance companies will not insure anything over 90% LTV and some won't insure over 85% LTV (this is specific to Atlanta and any other markets that are considered declining or oversupplied, so basically anywhere in the sunbelt). The MI companies are just flat out of capital due to all of the foreclosures. I had no idea, and I work in real estate (albeit, commercial, but still). Also, we may not qualify for the $8,000 tax credit afterall. I never thought I'd complain about making too much money. We'd qualify if they go by your 2008 tax return, but I'm assuming they'll use the 2009 return, and of course Matt gets his project bonus for the last 2.5 years this year (most likely), and I'm earning more than I did last year. Again, I'm very happy we are both doing well in our careers, but I didn't realize there was a cutoff earnings amount for the tax credit. Doesn't the government know we're trying to buy a house in intown Atlanta and it's freaking expensive?!? We need that $8K! :)
So, anyway, that's my rant for the day. Maybe I educated someone on what's going on in the market. Thankfully, we're still okay having to put 10% down, and we may still do FHA depending on the difference between a low rate plus PMI and a higher rate with no PMI. If we have to put 15% down, we're going to have to start looking at a lower price point or liquidate an investment or two (hey, do realized losses factor into AGI... hmmmmm...). :)
P.S. I just want to add that Matt and I are very smart with our money... we have no debt except my student loan at an extremely low interest rate, which is why we don't just pay it off. We're not trying to get into more house than we can afford, and I don't advise anyone buying something with monthly payments more than 25-30% of your net earnings. We just wanted to conserve as much of our savings as possible, which is why we were looking at 5% down since money is so cheap right now. Our payments would have hit our target range. Just wanted to clarify that! :)
The awesome spread and my pretty presents. A lot of the servingware was courtesy of Jenny, but I did all the food and drinks and flower arranging.
Jenny's adorable clothesline onesie idea.
Momma J. (See the diaper cake we made on the mantle? hahahaha).
Oh, these petit fours were some trouble, but I made them work! M for Madelyn... NOT "M"s. Yeah, that's what Publix put on them, because I wrote on the direction that I wanted script "M"s on each petit four. I asked the guy if he understood what I meant, and he said yes. Clearly the lady making them did not. Really, who would put "M"s on them, I ask!?
It was also my b-day that day, so I had to have mimosas and bloody marys!
After all the hard work!
