Home purchase 101

[TheAbacus]

My wife was asking some questions, and I realized I know much less about this process than I thought I did!

There have been plenty of debates at home about saving up and buying with cash vs getting a mortgage. We are debt averse, but don't want to be financially naive either. Any recommendations for a good introductory read to buying your first home, particularly pertinent to the above discussion?

[jfoxcpacfp]

The Flawless Home Purchase - WCI guest post by Josh Mettle 3/19/2014

Buying a Home the Right Way - WCI post from ACEP 12/6/2015

10 Reasons to Buy Your Home - WCI guest post from Mikki Ramey 3/16/2016 (be sure to read the comments by readers)

Also, note the additional linked posts at the end of each article.

I included a section on rent v. buy and buying a home in my Financial Guide for New Attendings.

 

[DMFA]

...are you sure you want/need to buy a home in the first place?

[Zaphod]

I wouldnt even be comfortable with having 100% liability for my house at this stage of my life. Im glad insurance and the banks have an interest as well. Anything could happen. Though I guess you still have insurance even when paid off.

[TheAbacus]

Thank you for those links Johanna!

@DMFA - The plan is to buy in 2-3 years, subject to both my wife and I liking our jobs enough to stay on for that period.

Mathematically, it is possible (in certain markets) to keep renting for life, and invest the difference in a long term, buy and hold strategy, and you'd probably come out ahead as compared to if you had bought a house. However, there is certainly an emotional component to the purchase of a home which I cannot deny. As long as emotions are not the sole reason for the decision, I don't think it is unwise to proceed. What do you think?

[jhwkr542]

Sounds reasonable. Money shouldn't be the only reason you decide things in life. I enjoy owning because I can change and tailor the house however I want. Want a nicer fridge? Buy a new one. Want a bigger deck? Just add on. Not that it's always the best financial decision but it's one of those things my wife and I have decided to spend money on. Living in a nice home and neighborhood makes us happy. Having an extra million in 20 years isn't worth it if we're less happy along the way.

[jfoxcpacfp]

jhwkr542 wrote:

Living in a nice home and neighborhood makes us happy.

Click to expand...

I agree. Not only that, but the stability of being able to raise your children in "the family home" is priceless compared to the uncertainty of a long-term rental. Of course, that's not possible for everyone, but at some point, I think that sense of permanence is important for your family (just maybe not as a new attending with $300k in student loans).