Re: Buying House information
4) pitfalls you should look out for
a) interst only loans. These are somewhat doable IF (and only if) the housing market you are in has homes increasing in value. But you shouldn't trust this. If you can't afford the house and also can't afford to rent (I know California is extremely high right now), plan to pay extra on your mortgage every chance you get - if you get money for a bonus or gift, send it in. It's the only way your principle will ever decrease.
b) negative amortization loans. These are a bad idea always. This is when your loan payment isn't even enough to cover your interest payment. With this sort of loan, even if you send in extra, it will be applied to back interest first.
c) buying a home where the seller says they won't accept your offer if you want an inspection. Insist on an inspection. Don't expect the inspection to find everything, but they should crawl under the house (if possible or necessary), check all the outlets, check out the attic space, check the plumbing, etc.
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