Jon
I am looking to buy a home in NJ. I have about 100k liquid to use on a down payment. I am either looking to buy a multi family for under 250k and rent out the one unit.
Or buy a small 2 bedroom 1 bath condo for under 75k and pay it straight no mortgage.
Which will cost me the least amount of money out of pocket in the long run? I am looking in neighborhoods around Princeton NJ...East Windsor, Plainsboro, Kingston, Hamilton etc...
About me: I am a 23 y/o single male with no children (and want to keep it that way for at least 3 more years), The girlfriend will most likely move in with me shortly after the purchase...I make around 50k a year. I have some experience in home repair but not that much.
Answer
Your ultimate goals would determine the type unit you would eventually purchase.
If you are looking for long term wealth then you would lean toward the investment property or multifamily place where tenants would assist in the purchase of the property. This is a difficult job as there are normally continued tenant and property problems with being a landlord.
Tome a condo would not be high on the list to purchase. The value of condo's do not appreciate as a house would. There is the condo associations as well as CC&R, by-laws and rules of the condo. If you decide to rent the unit and purchase another place, you might encounter problems. If there are more than 10% of the condo presently rented when you decide to rent you would not be able to rent your condo. This is a rule set up by HUD to keep a minimum of 90% of the condo with the owners residing there and not turning the condo complex into a rental complex.
You might consider a FHA mortgage loan, This would require you to apply for and borrow a sufficient amount to purchase your potential multifamily property. The interest rate and terms would be the same as if you purchased a house for you to stay in as long as you reside in one of the units. the down payment for a FHA mortgage loan is 3.5%.
By borrowing the funds to pay for your property there are a few benefits. You are able to get your points and fees and most of your closing cost returned to you when you file your income tax. The borrowed money is free to you as you are also able to currently deduct any interest you paid on the borrowed money.
Your funds would remain in your account continuing to earn interest. Your net worth would increase as what you currently have in your bank account and other financial instruments plus the property would increase your net worth, by at least $250,000 if you purchase the property you hope to purchase. Of course your mortgage payment would be considered a liability.
In the situation you would want to purchase your property you would be considered equity reich but cash poor and your net worth would be what you purchased the house for and the remaining funds in your sabings account.
You would need to contact a mortgage lender that is authorized to do FHA mortgage loans to see what amount of mortgage you would be approved for.
There are several internet mortgage calculators available for you use to throw a few number around so you are able to make an intelligent decision about you current financial situation as well as to determine if paying all cash for a property or obtaining a mortgage loan would benefit you financially.
I hope this has been of some benefit to you, good luck.
"FIGHT ON"
Your ultimate goals would determine the type unit you would eventually purchase.
If you are looking for long term wealth then you would lean toward the investment property or multifamily place where tenants would assist in the purchase of the property. This is a difficult job as there are normally continued tenant and property problems with being a landlord.
Tome a condo would not be high on the list to purchase. The value of condo's do not appreciate as a house would. There is the condo associations as well as CC&R, by-laws and rules of the condo. If you decide to rent the unit and purchase another place, you might encounter problems. If there are more than 10% of the condo presently rented when you decide to rent you would not be able to rent your condo. This is a rule set up by HUD to keep a minimum of 90% of the condo with the owners residing there and not turning the condo complex into a rental complex.
You might consider a FHA mortgage loan, This would require you to apply for and borrow a sufficient amount to purchase your potential multifamily property. The interest rate and terms would be the same as if you purchased a house for you to stay in as long as you reside in one of the units. the down payment for a FHA mortgage loan is 3.5%.
By borrowing the funds to pay for your property there are a few benefits. You are able to get your points and fees and most of your closing cost returned to you when you file your income tax. The borrowed money is free to you as you are also able to currently deduct any interest you paid on the borrowed money.
Your funds would remain in your account continuing to earn interest. Your net worth would increase as what you currently have in your bank account and other financial instruments plus the property would increase your net worth, by at least $250,000 if you purchase the property you hope to purchase. Of course your mortgage payment would be considered a liability.
In the situation you would want to purchase your property you would be considered equity reich but cash poor and your net worth would be what you purchased the house for and the remaining funds in your sabings account.
You would need to contact a mortgage lender that is authorized to do FHA mortgage loans to see what amount of mortgage you would be approved for.
There are several internet mortgage calculators available for you use to throw a few number around so you are able to make an intelligent decision about you current financial situation as well as to determine if paying all cash for a property or obtaining a mortgage loan would benefit you financially.
I hope this has been of some benefit to you, good luck.
"FIGHT ON"
Is it legal to rent out a room in your single family home to a roommate to save on monthly expenses? NJ?
Shadella
I recently made an offer on a home and would prefer if I could rent out one of my spare bedrooms to someone who will split the monthly expenses. The living areas will be completely shared and the house will not be set up as if it were a separate unit. Anyone, possibly a real estate lawyer or someone who currently does this, please only answer if you have facts since i am unable to find a solid answer that this is indeed legal.
Answer
The best answer will come from the code enforcement officer for your town. Some cities have restrictions on the number of unrelated persons allowed in one unit/house/apartment. Since these usually become a concern with 4+ college students renting a large home, you shouldn't have a problem with only one person. The CEO cn give you the quickest and most important answer.
Good luck
The best answer will come from the code enforcement officer for your town. Some cities have restrictions on the number of unrelated persons allowed in one unit/house/apartment. Since these usually become a concern with 4+ college students renting a large home, you shouldn't have a problem with only one person. The CEO cn give you the quickest and most important answer.
Good luck
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