First-time home buyers: how did you feel about getting a mortgage?

An option for me to buy a house has come up very suddenly and it seemed like a good idea at first - but I look at a mortgage and think "that's 15 years I'll spend paying back, at absolute minimum. Probably more like 25 years" - how can I possibly plan that far in advance?

So, how did you feel about getting a mortgage and seeing such a serious commitment stretch so far into the future? I'm mainly talking about the emotional side of things rather than financial

RBWells ,

I remembered my mom saying that by the end of the 30 year term the mortgage was her smallest housing expense, lower than the electric bill.

So yes, scary, but just remember that principal and interest part is going to seem smaller and smaller since it doesn't grow with inflation.

preppietechie ,
@preppietechie@midwest.social avatar

It’s weird. The numbers are so big and the dates are so far out there that none of it feels real. The fact that (assuming you fit their magic profile) some bank will accept your signature in return for hundreds of thousands of dollars is stranger still. I honestly wish we lived in a society where this sort of thing was NOT the norm. But if you live in the US, home ownership is one of the few mechanisms in place for us commoners to generate and/or pass on generational wealth (assuming that the whole system doesn’t collapse like the house of cards it probably is while you own the house).

Dearth ,

It's cheaper then rent. It raises my credit score. And i finally have ultimate authority on what i can do to decorate and maintain my home.

Honestly after over a decade of belonging I'd never be able to own my own place it was a huge relief to get a mortgage

brygphilomena ,

It was scary. But my mortgage itself isnt too bad. The amortization schedule was scarier, as the first several years you're almost paying just interest. And you get to see just how much it costs over the total life of the loan.

But I like my house, I feel a sense of pride and accomplishment. I can enjoy doing the fixes myself, and cry when things are so expensive to repair. There are so many things I want to do, but can't afford to at the moment.

I am really enjoying getting my yard they way I want. And it's even nicer to have a place that my girlfriend and her daughter can move in.

The house has appreciated 10% in the last two years. And as inflation keeps happening, it devalues the loan. The money I owe is worth less and less and the property I own is worth more and more. At least in general, that's how it should work.

Property taxes are pricey, but I'm happy with paying them for what I get in the city and neighborhood I'm in.

Thorny_Insight ,

It was a no-brainer for me. I've got to live somewhere in either case so instead of paying rent I could just aswell use that money to pay off my mortage (in reality I'm paying less).

In general my attitude towards loans is that if you can't pay cash then you can't afford it but house is obviously an exception as no one has that kind of money saved up.

Haven't regreted a day.

ABCDE ,

I went about it a different way: bought the land, saved up (while on cheap rent), and then built a place. Obviously this depends on where you are, but it's not impossible. The UK is notoriously difficult to get things done like this due to regulations and the slow movement of bureaucracy, I've heard NZ is the same, but... it's definitely something I'm happy I did.

empireOfLove2 ,

Alternative: you can spend that same 15-25 years paying roughly the same monthly amount in rent at various places, and have exactly zero equity or assets to show for it at the end of the period. Zero zilch nada, the money is burned and gone forever.

Frame it in that sense and it's a no brainer.

In the current market though either try to get a variable rate mortgage or be prepared to refinance it in a few years if/when interest rates cool down. the current rates suuuuuck.

13esq ,

In the UK, rent is substantially more than mortgage repayments.

Landlords will cry about their maintenance costs but I've never seen any maintenance that wasn't the cheapest fix possible by a cowboy family friend.

Nibodhika ,

That's curious, both in Ireland and Spain mortgages are much lower than rent, it's literally stupid for you to rent if you have the money to make the down payment (which unfortunately I never did, but know many people who went from >€2000 rent to ~€1400 mortgages)

ABCDE ,

That’s curious, both in Ireland and Spain mortgages are much lower than rent

You've both said the same thing in different ways; not sure if you were surprised.

Nibodhika ,

See kids? This is why you don't reply to comments before coffee

ABCDE ,

(:

ShepherdPie ,

You'll likely wind up paying significantly more in rent. When we bought our house in 2020, our mortgage was around $300 more than we were paying in rent. I think within 6 months or so, average rental prices for a similar home were significantly higher. By this point, even an apartment costs more to rent than our mortgage (PITI).

empireOfLove2 ,

You always pay more for rent- because mortgage payments aren't just lost to the void, they become equity value that you can then get back out by selling later, less cost of interest. The "real" cost of your house payment in a net-value sense is only the interest, actually.

paddirn ,

Scary at first, I hare any sort of debt, but I’m about 7 years into it now and I seemed to have gotten in at just the right time, so I’m thankful at how relatively low my mortgage is. I’ve just gotten used to having the debt now. I don’t even think about it in the long-term, to be honest. As long as I can hit my rent every month, that’s all I’m worried about. Paying it off will happen eventually, right before I die I’d guess.

It’s a pain having to constantly maintain stuff, but it’s been an education learning how to fix shit up around the place, one youtube video at a time. So many helpful people out there recording themselves fixing every random-ass thing possible.

rimu ,
@rimu@piefed.social avatar

It's not a 15 (or 25) year commitment - you can sell the house any time and use the money to pay off the mortgage.

DieguiTux8623 ,
@DieguiTux8623@feddit.it avatar

But the price of the property can decrease, so it's better considering an asset with a stable value over time (given the area, energetic efficiency, etc.).

ABCDE ,

Property is one of the most stable assets; even if there's a crash you can still live there until it recovers.

jordanlund ,
@jordanlund@lemmy.world avatar

30 year mortgage at 52 and 1 heart attack... "The mortgage will outlive me!"

OTOH... locked in $2,000/mo. housing payment for 30 years... It's already paying off as the rent on our old place is $2,300/mo. now.

ABCDE ,

Even if it was the same amount or a bit higher (or perhaps even a lot!), it would be better as you aren't throwing the money away. Good job though, despite the health.

Cruxifux ,

I was stoked. No more land lord, and instead of paying your landlords retirement you’re paying into yours.

crawancon ,

keep building that equity!

DontMakeMoreBabies ,

My rent was about $200 bucks cheaper each month but I can sell this and my payments go towards something I own rather than something the landlord owns.

Plus I can upgrade something I own in ways I'm not going to do as a renter.

LibertyLizard ,
@LibertyLizard@slrpnk.net avatar

I was a bit nervous at the time but looking back it was absolutely the right decision. If you’ve always been a renter, you can’t know the sense of peace that comes with knowing your home belongs to you and you can’t be evicted by someone else’s whim. I wasn’t aware of how it was weighing on me until I was free of it. Yes, I have to pay a mortgage but only a few years later it is much cheaper than local rents that I’d otherwise be paying. Overall it’s a much better way to live as long as it lines up financially for you.

partial_accumen ,

but I look at a mortgage and think “that’s 15 years I’ll spend paying back, at absolute minimum. Probably more like 25 years”

Yes! Probably more like 25 (or even 30 years)....at the same glorious fixed payment for that entire time! How many dozen times has your prior housing payment, rent, gone up? Now, it doesn't. The bank will never ask more from you on principal and interest in the future than it does on that very first mortgage statement.

When I bought my first house I was paying $800/month in rent at an apartment and the mortgage payment was $1000/month. I sold that house 17 years later with the last mortgage payment still being only $1000/month. I checked back on my old apartment to see what the rent was: $1400 for the same apartment I used to pay only $800/month for.

Also, you're not forced to keep that house you're buying for 25 or 30 years, but when you leave, its YOUR choice not the landlord's. When I sold my house I pocketed over $135k in profit because the housing value had gone up in that 17 years.

Glorious I tell ya!

gramie ,

Note that this is an American experience. In Canada, every time you renew your mortgage the interest rates are set at the current rate. So people renewing their mortgages now are paying around 7% interest, whereas 5 years ago they might have been paying 2%.

One of my co-workers had his mortgage payment jump from about $2,500 to $3,500/month a couple of years ago.

partial_accumen ,

Note that this is an American experience. In Canada, every time you renew your mortgage the interest rates are set at the current rate.

Thats very true. Isn't the longest mortgage rate in Canada something as short as 5 years or so? I have no idea how you guys can manage that. This is especially true with hot housing markets the Vancouver or the GTA where the price of homes already is insanely high.

brap ,

This is the same in the UK too. Still cheaper than renting though.

Delphia ,

Property generally increases in value while you pay it down.

My wife and I bought a $400k 3 bedroom flat near the university 8 years ago and we were both scared as fuck. paid $100k off it and just sold it for $600k

That $300k cheque we just used for the downpayment on building a "how do people afford these houses!?!" Thats going to cost $800k. But really our mortgage is only going to go up 20%

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