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More Expensive Home or Expensive Repairs?
Mr. Buyer: “I want to purchase the home that is $20,000 cheaper than that other home! Sure, I’ll have to replace the carpets and the windows need updating, and of course, the kitchen needs a bit of work, but it’s certainly the better deal!”
Is it really? Let me clue you in on the difference between the cash money on the out of pocket expenses and mortgage money… There is a huge difference between mortgage money and cash money. Just let me explain and you can view this from a whole new perspective.
Yes, you may want to buy a house that’s $20,000 cheaper, sure, who doesn’t love getting a great deal on a home? What you aren’t really thinking about, however, is that it’s probably going to cost you $10,000 to $15,000 to fix that house to bring it up to the standard of a house that costs $20,000 more. It will cost you about the same amount to update and repair a home. So, what would you rather do? Would you rather finance an extra $20,000 over a thirty-year loan at a smaller interest rate (which would equate to a minimal amount of money, I mean, $20,000 divided ... more
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