Toni House’s Blog

Are you an LSU Parent looking for a housing near the campus?

As LSU grows, so does the demand for better student housing. We are doing our best to keep abreast of the best areas for students to live. This involves a safe location, reasonably quiet areas, access to the LSU Bus stops, and pricing, but still gives the student the “good college experience”.

A buyer also needs to be aware of the possible increase or decrease of their investment in an area over time. That has a lot to do with the location of the housing you choose now and how long you decide to keep it.

These are all things real estate professionals are trained to do. It is in our best interest to look after our clients today, and hopefully, they will return to us over time to help when they are ready to sell. Some may continue to build a healthy a portfolio of rental property, whether it be for student housing or just in the Baton Rouge area.

Attached is the list of lenders that I have worked with the most over my 13 years as a Realtor in the Baton Rouge market. I hope you will enjoy working with them as much as our clients have in the past. Please feel free to call several of them to answer any questions you may have.

Below are some financing options available to you and an explanation of how much money at you may be required to bring to the closing once you have chosen the property.

FHA Loans
If you purchase a town home or home priced under $283,000.00, the minimum down payment of 3.5% is required. On a $125,000 purchase, that’s $4,375.00. The closing cost and prepaid items will run around $5,000.00. You can expect to bring at least $10,000.00 to the closing.
Your closing cost are your lender fees such as original fee, appraisal, and attorney cost to prepare the documents for closing, and reviewing the title at probate court, plus the cost of the property insurance/homeowners insurance.

My job as a buyer’s agent, is to work for you by asking the seller pay some, if not all of your closing cost and prepaid items. This is why we recommend you do not call the agent’s name on the sign in front of each property. Those listing agents represent the sellers and have their interest top of mind. You need to make sure your needs are meet and therefore hiring good buyer’s agent is in your best interest. A buyer’s agent would also ask the seller to pay for your termite inspection, your home warranty and repairs if needed.

In order to qualify as a parent on a FHA loan, the student will have to have to be on the loan as a buyer/co-owner. The student can also claim homestead exemption. This will deduct the first $75,000.00 of the property’s value from the total value when your property taxes are accessed and could be a saving of about $500.00 per year or more.

FHA Approved Condos
There are three such properties, out of the 22 in the city, that are located near the LSU Campus: Leigh’s Cove, Lake Beau Pre, and The Jefferson Condos. Again the student’s name would have to be on the loan as a buyer to qualify for FHA Funding.

Condos
All other condos require a minimum down payment of 5-20% depending on the investor the lender chooses when considering your interest rate and credit scores. Again, please remember to add the additional $5000.00 or so, in closing cost and pre-paid items. A good rule of thumb is in figuring cost is about 3.5% of the purchase price. Again, a good buyer’s agent will work to keep your closing costs and pre-paid items down by asking the seller’s to pay this for you. But we cannot control the down payment that is required by a lender.

Condo purchase with Credit Union
Using a Credit Union as your lender, for a college student’s/parent’s purchase, requires only 10% down. Some of our other lenders can also offer this option as well. Teachers Federal Credit Union in Baton Rouge also has a 7 year ARM for 4.5% with only 10% down. They are the only lender we have found that can do this and allow you to hold your own escrows. Most lenders will require a fee to “not escrow” your taxes and insurance.

Fidelity Homestead will do the same type loan, but will hold your escrows, even if you choose to pay separately for them. But, again, this is a ARM and you can only hold it for up to 7 years without an increase or adjustment being expected by the mortgage. Just remember, before the seventh year you should sell it or refinance.

ARM’s
Most lenders are now offering a 3.75% loan with 20% down with a 5 year ARM. This is an only for those parents or students who will sell the property in four years!! The rate will increase after the 5th year. But, again it is an option to consider.

Cash
Some of our buyers choose take out a line of credit on their personal home, or transfer money from a savings account. This will allow them to make a cash offer and is very attractive to the sellers. They are guaranteed that a lender will not have the ability to reject the loan or worry about appraisals if not included in the purchase agreement as a condition of the sale. However, I highly recommend all buyers make the appraisal a condition of the sale, even when paying cash.
If you want to keep most of your money in savings, I strongly recommend purchasing a home or town home and financing with a FHA loan. You may want to choose a home close to the campus; so future rental income would be available to you, should you chose to keep it. Also, the neighborhood needs to one that has proven to be profitable to past owners and a “keeper”, in regards to maintenance, and if the house has already had some upgrades such as new bathrooms and kitchen. While your children are living there, you may want to have the improvements done as they will be there to meet contractors when needed, or they can possibly learn to do some work themselves such as re-tiling and painting.

As far as homes and neighborhoods we recommend, Highland Creek, Plantation Trace and Sharlo have been the most popular neighborhoods for students at LSU and newly married students.

If you make the decision to keep a house for many years as an investment property, it’s best to purchase a brick or hardy plank exterior over a home with a wood siding. The painting and maintenance is very costly with wood exteriors. Wood rot, caulking, and mildew area a constant problem with the high humidly and amount of rain we experience in our area.

Another good neighborhood for students and a good for investment for parents with regard to resale, is Village St. George. It’s about 20 minutes south of the LSU campus and surprisingly parents and students purchase these because of the pricing and location. This neighborhood is more of a family neighborhood, but it is quiet and is near the Mall of Louisiana, Perkins Rowe, shopping and restaurants. Students can get quickly into campus by traveling Burbank into the South Gates of Louisiana.

See condos near LSU