Future Planning, the Home and Kids edition

Posted by Jim on Mar 12th, 2008
Mar 12

Nissa and I are still in the midst of purchasing our first home, dealing with mortgage brokers.  While looking at some financial information today, I found myself researching college savings plans.  We don’t even have plans for having children yet, but it already looks like we’re off to a great start for our future children’s college savings.  Maine is one of the best states to live in when it comes to saving for college.  State tax laws allow for a state tax deduction of up to $250 per beneficiary, no matter which state’s program we decide to use.  Plus, we aren’t limited to using just one state’s plan.   So, we could begin investing in Maryland’s College Investment Plan and take advantage of their low fees, low minimum contributions, and great funds managed by T. Rowe Price and count $250 per year towards our Maine state taxes.  At the same time, we can take advantage of Maine’s NextGen College Fund and reap the benefits of being an in-state resident by getting grants and matching contributions.  That’s like free money!  Take that Matthew Lesko!

There is a lot more great information out there about college savings.  Check out How Stuff Works’ guide to 529 Plans for a good overview.  Then use the wisdom of the folks at Kiplinger to find the best 529 Plan for your needs.

In other news, we met with a loan officer from Nissa’s credit union (Navy Federal) on Monday.  They offered us a great deal based on our current financial situation situation.  We don’t have enough money on hand to make a 20% down payment on they kind of house we want, but Navy Federal has some great 100% financing programs.  The money we had saved for a smaller down payment can now be used to pay some origination fees and points on the loan to get us a great interest rate (lower than my parents’ rate, I’ve discovered).  Plus, since Navy Federal is so large, they don’t require mortgage insurance!  That’s a savings of $135 a month right there.  If we were to get a loan for $180,000, we’d have a monthly mortgage payment (including taxes and home insurance) that is slightly higher than our current rent yet still within our budget.  That would get us a nice house that we’d actually own!  No more lying in bed grumbling that the heat isn’t on, we’d control it.  It would be ours.  We’re hoping to meet with a realtor Nissa knows sometime next week to begin searching for our home.

The Road Home

Posted by Jim on Feb 27th, 2008
Feb 27

Nissa and I have been discussing buying a home for a long time. We’re now going ahead and hope to have a place of our own by the summer. In the first two weeks of February we attended a first-time home buyers course offered through hoMEworks. This past Saturday we met with a representative from my credit union, who referred us to a local mortgage company that they arrange their home loans though. We have an appointment with the lender on Friday morning. Since it is wise to shop around for the best deal (which isn’t necessarily the lowest interest rate), we also have an appointment with a lender from Nissa’s credit union on Saturday morning. We are hoping to get a loan that will cover the kind of house we can both be happy with. Each of us has good credit, but also a bit of debt in the form of auto and student loans. I think we are being reasonable with our home buying expectations. We certainly aren’t going to look for who will loan us the most money and then buy as much as we possibly can. We’ve determined how much money we’d like to spend each month on the house (the mortgage, home insurance, heat and taxes) and we’ll find a home that fits that budget. I’m quite confident that the amount we will qualify for will more than cover the amount we are willing to spend on a house.

Being a first time home buyer isn’t easy, but luckily there is a lot of great information out there. The home buyers course I linked to above offered a wealth of information, as well as some contacts in the banking/real estate/title law fields. The Maine State Housing Authority page has a lot of information for first time home buyers as well. I’ve begun to read the Get Rich Slowly blog for economic advice that goes beyond the home buying process. There is also good advice available the The Motley Fool. Lastly, we’ve had some fun looking at what homes are available through Realtor.com and Zillow.com.