Southern Oaks SUV

Prior to Offer 

• Emily & Matt do a private showing and/or attend any hope house​

• Conduct market analysis to determine value (Scott)

• Procure Real Estate Agent with experience & expertise as offer may have to be from anonymous buyer

Offer

• Timing: Give house at least a month on the market​

• Anonymous buyer

• insist on inspection

• Inclusions

  • All current window coverings​

  • All appliances to include washer & dryer

  • TV wall mounts

Financing house ($430k purchase price portrayed - 30 yr loan)​

• 2 Options​

  • Option A: 20% down payment to eliminate PMI (Private Mortage insurance (approx. $300/month)​

    • $86k Down Payment​

    • $17k Closing Costs
      • ​Monthly Payment​ ($2,971)

        • $2,178 Principal & Interest​

        • $626 Real Estate Taxes

        • $167 Homeowners Insurance

  • Option B: 5% down payment​​​​​​​

    • $21k Down Payment​

    • $17k Closing Costs

      • Monthly Payment ($3,680) ​

        • $2,587 Principal & Interest​

        • $626 Real Estate Taxes

        • $167 Homeowners Insurance

        • $300 PMI

• Down payment & closing costs (Option A portrayed below):​​​​​​

  • $103k Total (down payment & closing costs)​

    • $82,400 (80%) Scott & Noreen​

    • $20,600 (20%) Matt & Emily

Ownership​​​​​ 

• Joint Tenancy with right of survivorship - last man (or woman) standing gets the house​

• Each couple is a 50% owner, that never changes regardless of the equity structure
• No individual can sell their individual share. The house belongs to all of us equally ​

Equity Structure​​

• What is an Equity Structure and how does it come into play?

  • What is equity? Proceeds received if house is sold. Proceeds are amounts left over after closing costs

  • Equity structure determines the % of each couple has of the equity in the house. ​

• Equity Structure Definition - The % of the home's equity each person/couple has at any given time. Note: Equity Structure is not ownership. Ownership never changes; Equity Structure is constantly changing based on capital/equity contribution to the house. ​

• What is an Equity/Capital Contribution:

  • Down Payment​

  • Upgrades

  • Principal paid

  • Major Repairs (roof, windows, driveway repave, etc.)

• How does Equity structure work?​

  • % of the Equity or Capital contributed (see examples)​

    • Scott & Noreen contribute $80k of the $100k down payment. Emily & Matt contribute $20k​

      • Equity Structure ​

        • 80% Scott & Noreen​

        • 20% Emily & Matt

      • Then, Scott & Noreen add a $10k Generator to house.​

        • Equity Structure changes to:​

          • 82% Scott & Noreen​ ($90k)

          • 18% Matt & Emily ($20k)

      • Emily & Matt (through monthly payments) pay $15k of principal, Scott & Noreen pay $5k of the principal balance.​​

        • Equity Structure changes to:​

          • 73% Scott & Noreen ($95k contributed)​

          • 27% Emily & Matt ($35k contributed)

      • Equity $$ Amounts grow by 5.5%/annually from the time they are paid/contributed. This should keep up with rate of home's value increasing. ​​

Monthly Payment​​​​​​ ($2,971)

• Split Taxes & Insurance equally (50/50)​

• Split Principal & Interest 60%/40% 

  • Emily & Matt start at 60% and increase by +5%/year starting in 2027, caps at 75% after 2029

  • Scott & Noreen start at 40%, decrease by 5%/year starting in 2027, end at 25%.

  • 30-year Mortgage, 20% down payment​

    • Emily & Matt ($1,700/month)​

      • $1,303 principle/Interest​

      • $313 Real Estate Taxes

      • $84 Homeowners Insurance

    • Scott & Noreen ($1,368/month)​

      • $871 principal/interest​

      • $313 Real Estate Taxes

      • $84 Homeowners Insurance