Advice for a potential first-time home buyer

While we are on the subject, I bought my house on a 30-year fixed rate and had it paid off in about 17 years. I knew I probably wasn't going anywhere and the monthly payments were pretty cheap, so I threw a lot of extra toward the principal each month. My question to the experts here, though, is this: the house is about 60 years old and I worry about stuff like the wiring. It's never been an issue, but it's obviously not up to today's code, either. Should I get it inspected, and when they tell me I need to get it rewired A. Do I bid it out?; B. How do I know who to trust doing the job? C. How expensive is it? D. Should I even be worried since we've had no problems?

 

I lived in a house that was 60 years old, and it still had fuse boxes instead of breakers. And then after an inspection resulted in the whole place being rewired, the guys who ripped out the old wires said it was a miracle that the place didn't burn to the ground at some point.

Not trying to worry you needlessly, but you probably should get your wiring checked.

 

Do everything possible to NOT NOT NOT throw money away on mortgage insurance. Even if it means waiting many months until you can come up with a bigger down payment. As of 2010 you can't even deduct it on your taxes. It's just money thrown into the toilet.

 

Did you mean "homeowners' insurance" instead of "mortgage insurance?" Because they are two different things.

Homeowners' insurance is to insure you in case of a fire, or disaster, or someone gets hurt, etc. Mortgage insurance is for the bank to charge you extra if you have less than, usually, a 20 percent down payment. As BTE said, mortgage insurance is just a waste of money. Homeowners insurance is necessary, and most lenders require it.

 

What do you mean, Sunshine, not like the subprime market caused any great bubbles or anything.

 

We were required to pay mortgage insurance because we only put 12 percent down. However, it was a one-time charge and was included in the closing costs. If I recall correctly, it was less than $300.

Paying it monthly sounds like a scam to me.

 

I would disagree here. If you don't have money in the bank to cover installation of a new hot water heater or a leaky roof, perhaps you can't afford a house. Self-insure yourself for the small stuff. Plan for the big stuff. Don't give all your money to a warranty company.

 

I guarantee you I'm paying $0 a month on mortgage insurance. It was a one-time payment at closing.

Monthly payments may not be a scam, but it's definitely NOT how I paid it.

 

Yes. I posted twice that it was a one-time payment made at closing.