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Published on 11/21/08
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HOUSE HUNTERS
TRICIA HENDRICKS AND JUSTIN BITNER
Buying a home seems like a natural step for Hendricks and Bitner, both 27, who are getting married in May. “Having the investment is important to us,” Bitner says, and Hendricks adds that renting has been frustrating. “We were kicked out of our last apartment because the building went condo and now we have the worst landlord we’ve ever dealt with.”
A two-bedroom condo in Roscoe Village would be ideal, but they expect their budget will direct them to Humboldt Park or Logan Square, two less-expensive neighborhoods on their list.
Hendricks pines for a place with some visual appeal and an in-unit washer/dryer. Bitner wants a yard, and as avid cooks, they both dream of a nice kitchen. “While I’d love to have a completely rehabbed place with stainless-steel appliances, I realize you have to give up some things in order to afford it,” he says.
Hendricks makes between $40,000 and $50,000 a year as a fund-raiser for social justice work and she knows her credit score is excellent. Bitner makes between $45,000 and $55,000 as associate director of marketing at Robert Morris College and his credit score is good. They each owe more than $25,000 in student loans, and Bitner has $7,000 in credit-card debt. The couple has saved $10,000.
Expert opinions
Chaz Walters
“It’s definitely doable.” Walters recommends they explore neighborhoods between Ashland and Western Avenues. “I look for areas that haven’t had much activity and all of a sudden, [tons of buildings are] under construction or being rehabbed. That’s generally a good sign that the area is on a boom.”
Gisella Tomasio
“It’s possible, but this couple…may be better off using their savings to pay off the debt first.”
Judge Mathis
“They should get familiar with all the costs associated with mortgages and buying a home for the first time, but I definitely feel they are in the position to afford a new home.”
VERDICT:
Alex
Mon, Mar 24, at 10:44am
I'm a Realtor and find myself embarrassed by Chaz's advice. Low income? Buy. Huge debt? Buy. No savings? Buy. Seriously, Chaz, step away from the kool aid.
jswede
Fri, Mar 21, at 12:31pm
hey about telling the whole story Chaz? "With 100% financing he/she could afford a $_____ house. Of course, he/she would also a have to pay huge sums in yearly property taxes, monthly assessments, take on market risk that may bottom out down another 10-15% from here, leaving the buyer in $25-100k of debt should they be forced to sell. Which they likely will have to, because they have no savings. It's all good though, because I got paid a commission." ****ing sick slimeball
jswede
Fri, Mar 21, at 10:45am
Lastly, in case anyone else was still listening to these idiots: Let's look at a 30yr amortizing loan. Which is what most people will get into (after this interest-only debacle anyway): lets say a 30yr 6% loan for $500k. You'll pay $3k monthly. $36k a year. After 5 years, you've paid about $180k. Of that $180, ~85% has been interest. You've paid off only about $30k of the house. Great way to become a home "owner", huh?
jswede
Fri, Mar 21, at 10:37am
and Gisella -- as an advisor -- how about levelling with people? Why not tell them the difference between renting and "buying" (with no/little money down using a mortgage)? It's about as simple as this: when you rent, you pay someone for the use of their property; when you "buy" with a mortgage, you pay some one for the use of their money. You're not an "owner" with no money down. Not even with 20% down. Oh, and also, when you buy you take market risk and pay huge taxes/assessments
jswede
Thu, Mar 20, at 09:09pm
Chaz says: "With 100% financing, he/she could afford a $______ house"
jswede
Thu, Mar 20, at 09:03pm
let's see.... "no money down" is a recommendation - with no disclaimer - just as long as Chaz gets paid. if your subjects take that advice there's a chance each of them will not get out of debt for decades.
jswede
Thu, Mar 20, at 08:59pm
It's nice to see that TimeOut has learned nothing in the last few years. (and that Chaz from the billboards is as big of a slime-ball as I always thought he'd be)
benjamin
Thu, Mar 20, at 12:00pm
Great - ask a real estate agent (who makes something like 5% of the purchase price) if someone should buy or rent - no chance of a bias there!
