vania-janet/multiturn-rag-retrieval-data huggingface dataset:
Sorry, this is sensationalist bullshit. Escrow payments have been around forever - they're not specific to BofA or the mortgage bubble, they've probably been common practice for decades. It's a much easier way for many people to pay their taxes and insurance, and banks don't net any profit for doing this*. Rather, it's an easy way for them to keep tabs on whether homeowners have insurance or not - if a home is uninsured by the owner the bank will have to insure it on its own.   (* banks are entitled to collect some escrow overage - I think it's 8% - in the event that taxes or insurance are higher than expected, but that is still the homeowners money, and would be cashed out in a payoff.)
Obamacare reshaped the insurance market. The ACA outlines certain minimum coverage requirements, generally referred to as ""Minimum Essential Coverage."" While employers and plans are not ""required"" to meet all of these coverage requirements there is a penalty associated with non-compliance. The single exception to this is grandfathered plans which can still sidestep a few of the requirements. The penalty is harsh enough that it's not worth the cost of offering a non-compliant plan. Whether you buy coverage through a state or federal exchange, through an insurance agent, or via your employer's COBRA program you will have ""ACA"" coverage (unless on the off chance your employer's plan doesn't check the ""Minimum Essential Coverage"" box). So generally all plans available to you will have $0 preventive coverage, pregnancy benefits, cancer treatment benefits etc. Another thing to consider is your entire family doesn't need to be on the same plan. If your family is healthy with the exception of one child, you can purchase $0 deductible coverage for the one child and higher deductible more catastrophic plan for the remainder of your family. In fact you could choose COBRA for one child and purchase individual coverage for the remainder of the family. The things to consider when you face a lay-off: I tried to mitigate my use of ""all"" and ""always"" because there are some narrow exceptions to these requirements, such as the ""Hobby Lobby"" decision allowing closely held organizations with highly religious owners the ability to remove certain contraception benefits. Understand that these exceptions are rare and not available to individual plans."
The fact that he can't get another mortgage means (a) The banks may be unwilling to allow him to be involved at all, and (b) it becomes even more critical to not commit fraud! You are effectively tricking the bank into thinking that you have the money for a down payment, and also that your brother is not involved! Now, to the actual question at hand - which I answer only for use on other transactions that do not meet the pitfalls listed above: This is an incredibly difficult question - What happens to your relationship with your brother when the value of the house goes down, and he wants to sell, but you want to stay living there? What about when the market changes and one of you feels that you're getting a raw deal? You don't know where the housing market will go. As an investment that's maybe acceptable (because risk forms some of the basis of returns). But with you getting to live there and with him taking only the risk, that risk is maybe unfairly on him. He may not think so today while he's optimistic, but what about tomorrow if the market crashes? Whatever the terms of the agreement are, get them in writing, and preferably get them looked at by a lawyer. Consider all scenarios, like what if one of you wants to sell, does the other have the right to delay, or buy you out. Or what if one if you wants to buy the other out? etc etc etc. There are too many clauses to enumerate here, which is why you need to get a lawyer."
To add to JoeTaxpayer's answer, the cost of providing (term) life insurance for one year increases with the age of the insured. Thus, if you buy a 30-year term policy with level premiums (the premium is the same for 30 years) then, during the earlier years, you pay more than the cost to the insurance company for providing the benefit. In later years, you pay somewhat less than the cost of providing the insurance. The excess premiums that the insurance company charged in earlier years and the earnings from investing that money covers the difference between the premium paid in later years and the true cost of providing the coverage. If after 20 years you decide that you no longer need the protection (children have grown up and now have jobs etc) and you cancel the policy, you will have overpaid for the protection that you got. The insurance company will not give you backsies on the overpayment. As an alternative, you might want to consider a term life insurance policy in which the premiums increase each year (or increase every 5 years) and thus better approximate the actual cost to the insurance company. One advantage is that you pay less in early life and pay more in later years (when hopefully your income will have increased and you can afford to pay more). Thus, you can get a policy with a larger face value (150K for your wife and 400K for yourself is really quite small) with annual premium of $550 now and more in later years. Also if you decide to cancel the policy after 20 years, you will not have overpaid for the level of coverage provided. Finally, in addition to a policy with larger face value, I recommend that you include the mortgage (if any) on your house in the amount that you decide is enough for your family to live on and to send the kids to college, etc., or get a separate (term life insurance) policy to cover the mortgage on your home. Many mortgage contracts have clauses to the effect that the entire principal owed becomes immediately due if either of the borrowers dies.
"A home actually IS a terrible investment. It has all the traits of something you would NEVER want to plunge your hard-earned money into. The only way that buying a house makes good money sense is if you pay cash for it and get a really good deal. It should also be a house you can see yourself keeping for decades or until you're older and want something easier to take care of. Of course, nothing can replace ""sense of ownership"" or ""sense of pride"" other than owning a house. And your local realtor is banking (really, laughing all the way to the bank) on your emotions overcoming your smart money savvy. This post really goes to work listing all the reasons why a house is a horrible investment. Should be required reading for everyone about to buy a house. Why your house is a terrible investment - jlcollinsnh.com TLDR; - You must decide what is more important, the money or the feelings. But you can't have both. If you read the article linked and still want to buy a house...then you probably should."
"Outside of broadly hedging interest rate risk as I mentioned in my other answer, there may be a way that you could do what you are asking more directly: You may be able to commit to purchasing a house/condo in a pre-construction phase, where your bank may be willing to lock in a mortgage for you at today's rates. The mortgage wouldn't actually be required until you take ownership from the builder, but the rates would be set in advance. Some caveats for this approach: (1) You would need to know the house/condo you want to move into in advance, and you would be committing to that move today. (2) The bank may not be willing to commit to rates that far in advance. (3) Construction would likely take far less than 5 years, unless you are buying a condo (which is the reason I mention condos specifically). (4) You are also committing to the price you are paying for your property. This hedges you somewhat against price fluctuation in your future area, but because you currently own property, you are already somewhat hedged against property price fluctuation, meaning this is taking on additional risk. The 'savings' associated with this plan as they relate to your original question (which are really just hedging against interest rate fluctuations) are far outweighed by the external pros and cons associated with buying property in advance like this. By that I mean - if it was something else you were already considering, this might be a (small) tick in the ""Pro"" column, but otherwise is far too committal / complex to be considered for interest rate hedging on its own."
"A couple of distinctions. First, if you were to ""invest in real estate"" were you planning to buy a home to live in, or buy a home to rent out to someone else?  Buying a home as a primary residence really isn't ""investing in real estate"" per se.  It's buying a place to live rather than renting one.  Unless you rent a room out or get a multi-family unit, your primary residence won't be income-producing.  It will be income-draining, for the most part.  I speak as a homeowner. Second, if you are buying to rent out to someone else, buying a single home is quite a bit different than buying an REIT.  The home is a lot less liquid, the transaction costs are higher, and all of your eggs are in one basket.  Having said that, though, if you buy one right and do your homework it can set you on the road for a very comfortable retirement."
No. Such companies don't exist. Derivative instruments have evolved over a period and there is a market place, stock exchange with members / broker with obligations etc clearly laid out and enforceable. If I understand correctly say the house is at 300 K. You would like a option to sell it to someone for 300 K after 6 months. Lets say you are ready to pay a premium of 10K for this option. After 6 months, if the market price is 400 K you would not exercise the option and if the market price of your house is 200 K you would exercise the option and ask the option writer to buy your house for 300 K. There are quite a few challenges, i.e. who will moderate this transaction. How do we arrive that house is valued at 300K. There could be actions taken by you to damage the property and hence its reduction in value, etc. i.e. A stock exchange like market place for house is not there and it may or may not develop in future.
First, radon is common in some areas of New Jersey.  Before you back out of this house, you should consider if you can find a different place to live that does not have a radon issue.   You should be able to find someone who does radon testing specifically.  Such a company should be able to check that neither the gas nor the particulates (on walls, etc.) are present in the house after the mitigation.  Apparently checking the water is possible as well.  If such a test fails and the seller does not do more mitigation, that would be grounds for withdrawing from the contract.   Since radon is common in New Jersey, it is likely that the contingencies are written such that the seller offering to mitigate is enough to keep you in the contract.  You would have to ask a lawyer to be sure.   In general, contingencies are based on the offer you made, which is a contract.  If you wanted radon to be a deal breaker, then you should have written the offer that way.  Left to themselves, real estate agents will offer mitigation instead.  This is because they get paid a commission on the sale.  No sale; no commission.  Obviously too late for this house, but in the future, you may want to be more careful about this.   Radon mitigation is common and costs in the $1000-$3000 range.  One estimate in that link suggests that $1300 is the minimum with required fees, etc.   If your offer is not written to allow you to walk away if there is a radon issue, you will probably lose your deposit if you walk away.  You can also try to be extra picky about your contingencies.  In particular, they have to show you that they have mitigated the radon problem.  If you can find something that indicates that they have not, then you can get more mitigation.  If they either fail to respond or choose not to respond, that could allow you to withdraw from the deal without losing your deposit.   There usually aren't additional problems beyond losing your deposit from walking away.  But again, this depends on the offer contract.  This is really something that a lawyer should read.
"I have bought and sold 18 homes. Yes it sounds like a lot some were flips, some turned to rentals and we have moved many many times. I have had home warranties when the seller offered them. In my experience the warranty company does as little as possible.  For example, hot water heaters; you call the warranty company because the hot water heater is making ticking noises, and its running the gas all the time and you still can't take a 5 minute shower with out running out of hot water. These are all signs that the water heater is full of slide and its gong to blow and flood where ever it happens to be. Will you get a new hot water heater? No, you will pay the $75 for the service call the warranty company will not replace it because ""it still works"". Now after it has flooded you basement or garage, front hall or where ever then they will replace it but not pay for any damage that has occurred.  Same for other things. You can pay that service fee over and over for some slap stick repair that after all the fees and hassle of missing work to wait on the repair person well it would have been cheaper to just pay for a replacement."
Considering your question, I have been in the market for a house to buy. There is a house that I   like and I wanted to know if I could afford it. You state your Assets: Awesome! Current Income:  Great job putting $1000/month into your 401k!  That is $12,000/year saved for retirement. Excellent! Current expenses: Why do you want to buy a house for more than 4x your gross income, and 3x median house price (U.S.)?  Are you planning on living in the house for at least 5-7 years?  There is a risk that interest rates will rise, and that will affect your ability to sell the house. Expected expenses: Adding your other essentials, You are considering increasing your expenses by $1000-1200/month. Looking at the amounts you quoted for direct housing expenses, you will have committed $2600/month to a mortgage payment.  Adding your other estimated essentials, you will spend over $3700/month (leaving $2200/month for everything else). You may have higher utilities for a house than an apartment, you are doing well with your food budget, and your cellphone is lower than many.  You anticipate $650/month ($7800/year) tax savings (be careful, congress is looking for ways to increase tax revenue). You want to keep your essential expenses under 50% (much more than 50% is difficult, and I am trying to get to 40%).  You may live in an area where housing costs are an out-sized expense.  But an option would be to save more, and a larger down payment could lower the monthly expenses below that 50% mark.
The biggest issue I can see is that in order to have your parents protected properly, they'll have to register an interest in the property (ie, the 25%). I can't see the mortgage lender being too happy to have a second lienholder on the house for a total of 100% of the purchase price. Usually their conditions state that they'll need to be informed of other debts secured on the house and might actually have a say in that. Another way of accomplishing this is putting your parents on the house's deeds but that might also complicate matters with the lender and cause additional problems when it comes to selling the property. Not to mention that if anything bad happens to your parents, their stake in your property would be counted as one of their assets and you might find yourself in the situation where you have to come up with 25% of the property value right now or you might find that you have to sell the property to the first bidder simply because you do need the money as quickly as possible. Personally I wouldn't do it (especially without legal advice), the legal structure can be a nightmare and you'll just end up painted into a corner.
Typical costs to buy might include: One piece of advice if you've never bought, fixing problems with a house always seems to cost more than the discount in price due to the problems. Say the house needs a 15K new kitchen it seems like it will be just 7K cheaper than a house with a good kitchen, that kind of thing. Careful with the fixer uppers.  Costs to sell include: Doing your own cleaning, repairs, moving, etc. can save a lot.  You can also choose to work without an agent but I don't know how wise it is, especially for a first time buyer. In my town there are some agents that are buyers only, never seller's agents, which helps keep them unconflicted.  Agent commissions may be lower in some areas or negotiable anywhere. Real estate transfer taxes may be owed by buyer or seller depending on location: http://en.wikipedia.org/wiki/Real_estate_transfer_tax
You've already hit on the big difference. If you buy a property, you've made a big commitment, for better or worse.  If you bought wisely, you'll be very happy.  If not, you could go bankrupt. An REIT spreads out the risk, but the reward isn't as great. There's less barrier to entry in buying shares of an REIT than there is in buying an investment property:  money, time, maintenance. The answer for you depends on what level of effort you want to put into your investment.  If you are all ready to pick up an investment property, make the down payment, get appraisal and inspection, clean up the house, and fill it with tenants, then go for it.  Otherwise, research some REITs and buy some shares. (Disclaimer:  I have a rental property that's doing pretty well now.)
I think that mbhunter hit the nail on the head regarding your question. I just want to add that having a policy that isn't sponsored by your employer is a good idea... employer policies are regulated by the federal government via ERISA. Independent policies are state regulated, and usually have better protections. Also, look for a policy that allows you to increase your coverage later without medical qualification so you don't need to overbuy insurance initially.
There are bullion dealers who will buy gold no matter its form. You won't get the spot price as it's probably being bought same as junk jewelry or any other gold needing to be melted and recast. If this is your concern, you should buy a fireproof safe, the kind people use to store their important documents, and add the gold value to home insurance policy. Do not get a safe deposit box at the bank, see mbhunter's comment and link.
The first question is low long will you wish to stray there? It costs of lot in legal changes other   changes plus taxes to buy and sell, so   if you are not going to wish to live   somewhere for at least 5 years, then I   would say that renting was better. Do you wish to be able to make changes? When you rent, you can’t change   anything without getting permission   that can be a pain. Can you cope with unexpected building bills? If you own a home, you have to get it   fixed when it breaks, but you don’t   know when it will break or how much it   will cost to get fixed. Would you rather do a bit of DIY instead of phone up a agent many times to get a small problem fixed? When you rent, it can often take many   phone calls to get the agent /   landlord to sort out a problem, if own   your home, out can do yourself. Then there are the questions of money that other people have covered.
There are probably thousands of houses that you could buy. If you want to buy a house, it is very unlikely that the one you are renting right now is the best possible buy.  Usually people living in the houses they own are more interested in the quality of their property and the quality of their neigborhood than people who are renting, so I'd say that you are generally better off finding a home to buy in an area where the majority own their homes.
"One reason I have heard (beside to keep you paying rent) is the cost of maintenance and improvements.  If you hire someone else to do all the work for you, then it may very well be the case, though it is not as bad as a car. Many factors come into play:   If you are lucky, you may end up with a lot that is worth more than the house on it in a few decades' time. Personally, I feel that renting is sometimes better than owning depending on the local market.  That said, when you own a home, it is yours.  You do have to weigh in such factors as being tied down to a certain location to some extent.  However, only the police can barge in -- under certain circumstances -- where as a landlord can come in whenever they feel like, given proper notice or an ""emergency.""  Not to mention that if someone slams a door so hard that it reverberates through the entire place, you can actually deal with it. The point of this last bit is the question of home ownership vs renting is rather subjective.  Objectively, the costs associated with home ownership are the drags that may make it a bad investment.  However, it is not like car ownership, which is quite honestly rarely an invesment."
Altough this may vary a lot depending on where you live and your actual finance, here what convinced me buying a home instead of renting : Other benefits :
Another reason, and to me the main reason not to buy a house if you're in your early 20s (regardless of your income), is mobility. If you rent, you can move pretty much whenever you want after the first year of your rental lease is up, even before then in some cases. If your fiancee finishes school and gets a great job offer in another city or state, you can move there pretty quickly. When you own a house, that is much harder to do. Your having two kids makes it harder in either case, but at this point in your lives you really don't know where your future will take you, geographically speaking, and renting gives you the option of moving easily if you have to.
They are two different animals. When you rent you are purchasing a service.  The landlord, as your service provider, has to make a profit, pay employees to do maintenance, and buy materials. The price of these things will increase with inflation, and that rolls into your rent price. Taxes also are passed to the tenant, and those tend to only go upward. Market forces of supply/demand will drive fluctuation of prices as well, as other posts have described. When you buy, you are purchasing just the asset - the home. This price will also be driven by supply/demand in the market, but don't try to compare it to buying a service. Cheers!
There is a way that I recommend figuring out if it is likely bad financial decision to buy, and that's by looking at a financial comparison of renting versus buying. In some cases even with the bursting of the bubble it is still a bad deal to buy. DC went from renting being more cost effective to buying, but San Francisco is one area where buying is still not necessarily the best choice. To figure out what the case is for your area, look at the New York Times rent versus buy calculator. Find a home for rent on craigslist similar to what you'd look to buy. Find a home for sale on one of the MLS aggregator sites that represents something you think you'd like. Plug in the numbers. Figure out how many years you'd have to stay in your purchase for it to be a good deal. In the likely event that the calculator says buy, start saving if that's what you really want. You're never going to be able to absolutely guarantee that you won't be upside down. What you can control is getting as much principal in that house as you can. The more you have, the less likely you will be upside down. Build a down payment now, reap the rewards later.
If I were planning to move every few years, I'd seriously consider renting, rather than purchasing. And remember - a home isn't an investment, it's a living expense.
Colloquially, there's no difference except for the level of risk (which is an estimate anyway). Classically, investment is creating wealth through improvement or production.  Purchasing a house with the intent to renovate and sell it for a profit would be an investment, as the house is worth more when you sell than when you bought it. Speculation, on the other hand, is when you hope to make a profit through changes in the market itself.  Purchasing a house, letting it sit for 6 months, and selling it for a profit would be speculation.