3 People The First Time Home Buyer Needs On Their Team
Heather Dunlop asked:
Many first time home buyers are not sure where to get started. They are ready to buy their first home and want to make sure they don’t make any mistakes. So where do you go first?
There are three people that will be important to the first time home buyer. These people can walk you through the process and help you purchase your first time. You and your team have the same goal, to find you a home you can afford.
The first person you want on your team is a Realtor. You want to make sure you find a Realtor who specializes in working with first time home buyers. They will have the patience to answer all of your questions and reduce your fears. They have been through the process many times and will be able to anticipate your questions and your needs, making the process easier on you. Your Realtor can show you homes in neighborhoods that meet your needs. They will keep you focused on what you said you were looking for in a home.
Your Real Estate Agent can also help you find the other two people you need on your team. Your Realtor will already have relationships with these other people, who are also familiar with working with first time home buyers.
The second person you want on your team is a Mortgage Broker. Again, find a mortgage broker that works with first time home buyers. This mortgage broker will know about the city, state, and federal programs available to help first time home buyers purchase their dream home. They know what kind of loan you can qualify for, how much you will need for a down payment, and the lenders requirements.
Get pre-approved before you start to look at homes. Your mortgage broker will get your pre-approved so you know exactly how much house you can afford and don’t waste your time looking at houses you can’t buy. There’s nothing worse than finding the house you love then finding out you can’t afford it. Avoid this activity and you will be very excited when you find the home you can afford.
The third person you want on your team is a Home Inspector. As a first time home buyer you are not aware of what is involved in looking at the details of a home to make sure it is safe and will not require costly repairs. Your Home Inspector will go over every nook and cranny and tell you what they find. A good home inspection can save you from buying a home that needs major repairs without you knowing about the. Be present during the home inspection. You can ask the inspector questions about what they find, giving you a better understanding of the condition of the home. You can also ask the inspector any questions you may have about the house.
Build your team with people who specialize in working with first time home buyers. You’ll be glad you spent the time to find the right people to help you.
Sandra
Many first time home buyers are not sure where to get started. They are ready to buy their first home and want to make sure they don’t make any mistakes. So where do you go first?
There are three people that will be important to the first time home buyer. These people can walk you through the process and help you purchase your first time. You and your team have the same goal, to find you a home you can afford.
The first person you want on your team is a Realtor. You want to make sure you find a Realtor who specializes in working with first time home buyers. They will have the patience to answer all of your questions and reduce your fears. They have been through the process many times and will be able to anticipate your questions and your needs, making the process easier on you. Your Realtor can show you homes in neighborhoods that meet your needs. They will keep you focused on what you said you were looking for in a home.
Your Real Estate Agent can also help you find the other two people you need on your team. Your Realtor will already have relationships with these other people, who are also familiar with working with first time home buyers.
The second person you want on your team is a Mortgage Broker. Again, find a mortgage broker that works with first time home buyers. This mortgage broker will know about the city, state, and federal programs available to help first time home buyers purchase their dream home. They know what kind of loan you can qualify for, how much you will need for a down payment, and the lenders requirements.
Get pre-approved before you start to look at homes. Your mortgage broker will get your pre-approved so you know exactly how much house you can afford and don’t waste your time looking at houses you can’t buy. There’s nothing worse than finding the house you love then finding out you can’t afford it. Avoid this activity and you will be very excited when you find the home you can afford.
The third person you want on your team is a Home Inspector. As a first time home buyer you are not aware of what is involved in looking at the details of a home to make sure it is safe and will not require costly repairs. Your Home Inspector will go over every nook and cranny and tell you what they find. A good home inspection can save you from buying a home that needs major repairs without you knowing about the. Be present during the home inspection. You can ask the inspector questions about what they find, giving you a better understanding of the condition of the home. You can also ask the inspector any questions you may have about the house.
Build your team with people who specialize in working with first time home buyers. You’ll be glad you spent the time to find the right people to help you.
Sandra
3 Ways your First Time Home Buyer can come up with the Down Payment
Heather Dunlop asked:
I love the house, but I don’t have a down payment”
How many times have you thought that? Many buyers are looking at houses and they think they don’t have a down payment. Don’t walk away from the house. There are ways you can come up with the down payment.
Here are 3 ways you can come up with the down payment.
1. Use money from an IRA (it doesn’t have to be their own IRA)
The IRS allows a first time homebuyer to withdraw up to $10,000 from an IRA penalty free and tax free.
If your are married, each spouse can each withdraw $10,000 penalty free, giving you $20,000 to put down on the home.
What if you don’t have an IRA? You can ask someone in your family if they have an IRA. Family members are allowed to give you money from their IRA to use toward the down payment of a home for a first time home buyer. The IRS will allow the first time home buyer, their spouse, a child, a grandchild, a parent or other ancestor, to withdraw $10,000 from their IRA penalty free and apply it to the purchase of the home.
For the withdrawal, the IRS defines a first time home buyer as “you are a first-time homebuyer if you had no present interest in a main home during the 2-year period ending on the date of acquisition of the home which the distribution is being used to buy, build, or rebuild. If you are married, your spouse must also meet this no-ownership requirement.” (http://www.irs.gov/publications/p590/ch01.html#en_US_publink10006447)
Before you withdraw funds from an IRA, make sure you check with your accountant.
2. Use the First Time Home Buyer Tax credit
Some states allow the tax credit to be used as the down payment for the home of a first time home buyer. That’s great if you are in one of these states.
If you are buying a house that is not in a state that allows the first time home buyer tax credit to be used as the down payment, there are some other ways to accomplish the same thing.
That is why it is critical that you speak with an accountant before taking the loan out of your 401K.
You could borrow money from a relative or family member and pay back that loan when you receive the first time home buyer tax credit. The advantage here is that you can repay the loan in full when you receive the tax credit, instead of making monthly payments. You should first check with your accountant to see how much of the tax credit you will qualify for.
3. Borrow from family
Many family members want to see you in their first home. You can ask family if they will lend you the money for the down payment. To entice them to lend you the money, you need to offer them something in return. You should offer to pay them interest and set the amount of time it will take to pay back the loan, and how much you will pay them each month/quarter/year.
This loan can also be secured by the house as a second mortgage. There is no rule that states the 2nd mortgage has to come from a bank. As long as the bank is secured in 1st position at an LTV that is acceptable to them, and they know where the down payment is coming from, they should be OK with making the original loan. The family member that is loaning money to you is in a secure position because their loan is secured by the house.
These three items should help you get you into your first home.
Marlene
I love the house, but I don’t have a down payment”
How many times have you thought that? Many buyers are looking at houses and they think they don’t have a down payment. Don’t walk away from the house. There are ways you can come up with the down payment.
Here are 3 ways you can come up with the down payment.
1. Use money from an IRA (it doesn’t have to be their own IRA)
The IRS allows a first time homebuyer to withdraw up to $10,000 from an IRA penalty free and tax free.
If your are married, each spouse can each withdraw $10,000 penalty free, giving you $20,000 to put down on the home.
What if you don’t have an IRA? You can ask someone in your family if they have an IRA. Family members are allowed to give you money from their IRA to use toward the down payment of a home for a first time home buyer. The IRS will allow the first time home buyer, their spouse, a child, a grandchild, a parent or other ancestor, to withdraw $10,000 from their IRA penalty free and apply it to the purchase of the home.
For the withdrawal, the IRS defines a first time home buyer as “you are a first-time homebuyer if you had no present interest in a main home during the 2-year period ending on the date of acquisition of the home which the distribution is being used to buy, build, or rebuild. If you are married, your spouse must also meet this no-ownership requirement.” (http://www.irs.gov/publications/p590/ch01.html#en_US_publink10006447)
Before you withdraw funds from an IRA, make sure you check with your accountant.
2. Use the First Time Home Buyer Tax credit
Some states allow the tax credit to be used as the down payment for the home of a first time home buyer. That’s great if you are in one of these states.
If you are buying a house that is not in a state that allows the first time home buyer tax credit to be used as the down payment, there are some other ways to accomplish the same thing.
That is why it is critical that you speak with an accountant before taking the loan out of your 401K.
You could borrow money from a relative or family member and pay back that loan when you receive the first time home buyer tax credit. The advantage here is that you can repay the loan in full when you receive the tax credit, instead of making monthly payments. You should first check with your accountant to see how much of the tax credit you will qualify for.
3. Borrow from family
Many family members want to see you in their first home. You can ask family if they will lend you the money for the down payment. To entice them to lend you the money, you need to offer them something in return. You should offer to pay them interest and set the amount of time it will take to pay back the loan, and how much you will pay them each month/quarter/year.
This loan can also be secured by the house as a second mortgage. There is no rule that states the 2nd mortgage has to come from a bank. As long as the bank is secured in 1st position at an LTV that is acceptable to them, and they know where the down payment is coming from, they should be OK with making the original loan. The family member that is loaning money to you is in a secure position because their loan is secured by the house.
These three items should help you get you into your first home.
Marlene
What you need to know about First Time Home Buyer Credit
Lokesh asked:
The federal government has taken a number of steps to revive the interest in the housing sector. In its attempt to promote the housing sector and to stabilize the falling prices in the housing sector, the government provides a number of monetary incentives to buy or build their own houses. At the forefront of these incentives is the amendment to the Homeownership, and Business Assistance Act in 2009. The revisions have been made keeping the interest of the first time home buyers. In accordance with the latest modifications to the act, house purchased by first time home buyers from January 01, 2009 to April 30, 2010 shall be eligible for claiming a buyer credit from the government. This credit shall be in the form of reduced payment of tax by the buyer. The extent of tax benefit would be a maximum of 10% of the property value and limited to a maximum amount of USD Eight thousand. The maximum buying price of the house you can purchase to be rewarded under the home buyer credit is USD 800,000.
It is important however to understand the taxman’s definition of a first time home buyer. As per IRS, a person who has not bought a house during the last three years shall be considered as a first time home buyer. There are a few other eligibility conditions that an individual needs to fulfill besides being a first time home buyer. An individual’s income cannot exceed USD 125,000 in case of single ownership properties and USD 250,000 for properties with joint ownership of the couple. The income relaxation is allowed for all house purchase transactions finalized during the period November 06 2009 to April 30, 2010. You must ensure that all your sale agreement papers are in place by April 30, 2010 and the sale process is closed by June 30, 2010 to be a beneficiary under this arrangement. You may even construct your own house by utilizing the services of a contractor to avail this tax incentive.
The government has even gone ahead and simplified the process of filing a claim towards home buyer credit. An individual needs to submit two forms to stake his claim which are called the HUD-1 settlement form and the IRS from 5405. There are a plenty of online resources which give complete and easy to understand details of the first time home buyer credit. The one that would be particularly interest the prospective first time home buyers would be the on-line resource managed by the National Association of Home builders. The IRS website is another resource providing detailed information about the scheme. The scheme has had a tremendous response from the consumers as indicated by recent data pertaining to purchases made by first time home buyers. This is also helping the housing industry to regain its lost glory and fortunes. It’s time to act now for the first tome home buyers as the deadline of April 30, 2010 is fast approaching. You can have your cake and eat it too by making use of this consumer friendly initiative.
Jon
The federal government has taken a number of steps to revive the interest in the housing sector. In its attempt to promote the housing sector and to stabilize the falling prices in the housing sector, the government provides a number of monetary incentives to buy or build their own houses. At the forefront of these incentives is the amendment to the Homeownership, and Business Assistance Act in 2009. The revisions have been made keeping the interest of the first time home buyers. In accordance with the latest modifications to the act, house purchased by first time home buyers from January 01, 2009 to April 30, 2010 shall be eligible for claiming a buyer credit from the government. This credit shall be in the form of reduced payment of tax by the buyer. The extent of tax benefit would be a maximum of 10% of the property value and limited to a maximum amount of USD Eight thousand. The maximum buying price of the house you can purchase to be rewarded under the home buyer credit is USD 800,000.
It is important however to understand the taxman’s definition of a first time home buyer. As per IRS, a person who has not bought a house during the last three years shall be considered as a first time home buyer. There are a few other eligibility conditions that an individual needs to fulfill besides being a first time home buyer. An individual’s income cannot exceed USD 125,000 in case of single ownership properties and USD 250,000 for properties with joint ownership of the couple. The income relaxation is allowed for all house purchase transactions finalized during the period November 06 2009 to April 30, 2010. You must ensure that all your sale agreement papers are in place by April 30, 2010 and the sale process is closed by June 30, 2010 to be a beneficiary under this arrangement. You may even construct your own house by utilizing the services of a contractor to avail this tax incentive.
The government has even gone ahead and simplified the process of filing a claim towards home buyer credit. An individual needs to submit two forms to stake his claim which are called the HUD-1 settlement form and the IRS from 5405. There are a plenty of online resources which give complete and easy to understand details of the first time home buyer credit. The one that would be particularly interest the prospective first time home buyers would be the on-line resource managed by the National Association of Home builders. The IRS website is another resource providing detailed information about the scheme. The scheme has had a tremendous response from the consumers as indicated by recent data pertaining to purchases made by first time home buyers. This is also helping the housing industry to regain its lost glory and fortunes. It’s time to act now for the first tome home buyers as the deadline of April 30, 2010 is fast approaching. You can have your cake and eat it too by making use of this consumer friendly initiative.
Jon
Macomb County Realtors Advice: Tax Credit for First-Time Home Buyers
Mark Goedert asked:
First-time home buyers purchasing a home are eligible for the tax credit. The purchase must occur between 1/1/09 and 12/1/10. The law defines a first-time home buyer as one who has not owned a principal residence during the three-year period of time prior to the purchase. With married couples, both spouses must meet the 3-year requirement to qualify for this credit.
The credit is a refundable income tax credit. This means that if the amount of credit you claim on your 2009 income tax return is more than your tax liability, the difference is paid to you in your income tax refund.
The tax credit is equal to 10% of the purchase price of the home up to a maximum credit of $8,000. There are modified gross income requirements to be eligible for the credit; single tax payers’ limit is $75,000 and married tax payers’ limit is $150,000. The credit is reduced for tax payers whose income is higher and the phase out range is $20,000; therefore, reducing the credit to zero for those with income of $95,000 if single and $170,000 if married.
The tax credit is claimed by filling out the IRS tax Form 5405. The IRS.gov website will have details and instructions for completing this form.
Revisions to Tax Credit for 2009
There were several modifications made to the First-Time Homebuyer Tax Credit for 2009.
Amount of maximum credit increased to $8,000 Purchasers utilizing revenue bond financing are eligible for the tax credit No repayment requirements on purchases from 1/1/09 – 12/1/09. Recapture provision states if your home is sold within 3 years of purchase, the entire amount of credit is recaptured on the sale (this applies only to homes purchased in 2009) The termination date is 12/1/09 and the effective date for all revisions is 1/1/09.
Other provisions of the Stimulus Plan include:
FHA, Fannie Mae and Freddie Mac Loan Limits
Neighborhood Stabilization
Commercial Real Estate
Rural Housing Services
Low Income Housing Grants
Tax Exempt Housing Bonds
Energy Efficient Housing Tax Credits and Grants
Transportation Investments
Broadband Deployment
Maureen
First-time home buyers purchasing a home are eligible for the tax credit. The purchase must occur between 1/1/09 and 12/1/10. The law defines a first-time home buyer as one who has not owned a principal residence during the three-year period of time prior to the purchase. With married couples, both spouses must meet the 3-year requirement to qualify for this credit.
The credit is a refundable income tax credit. This means that if the amount of credit you claim on your 2009 income tax return is more than your tax liability, the difference is paid to you in your income tax refund.
The tax credit is equal to 10% of the purchase price of the home up to a maximum credit of $8,000. There are modified gross income requirements to be eligible for the credit; single tax payers’ limit is $75,000 and married tax payers’ limit is $150,000. The credit is reduced for tax payers whose income is higher and the phase out range is $20,000; therefore, reducing the credit to zero for those with income of $95,000 if single and $170,000 if married.
The tax credit is claimed by filling out the IRS tax Form 5405. The IRS.gov website will have details and instructions for completing this form.
Revisions to Tax Credit for 2009
There were several modifications made to the First-Time Homebuyer Tax Credit for 2009.
Amount of maximum credit increased to $8,000 Purchasers utilizing revenue bond financing are eligible for the tax credit No repayment requirements on purchases from 1/1/09 – 12/1/09. Recapture provision states if your home is sold within 3 years of purchase, the entire amount of credit is recaptured on the sale (this applies only to homes purchased in 2009) The termination date is 12/1/09 and the effective date for all revisions is 1/1/09.
Other provisions of the Stimulus Plan include:
FHA, Fannie Mae and Freddie Mac Loan Limits
Neighborhood Stabilization
Commercial Real Estate
Rural Housing Services
Low Income Housing Grants
Tax Exempt Housing Bonds
Energy Efficient Housing Tax Credits and Grants
Transportation Investments
Broadband Deployment
Maureen
First Time Home Buyer Tips: Finding a Home
Mark Goedert asked:
There really is no great secret to finding a home. Though there are countless theories and techniques, finding a house comes down to perseverance and luck. You must be willing to work at putting yourself in the right place at the right time to find your dream home.
Consider your needs and your desired criteria for a home; number of bedrooms, basement or crawl, garage or shed, lot size, neighborhood, etc… Just look; do not call the number listed in the ad! When you are ready to see homes you will want to work with a real estate agent who will represent you to see that you are getting the best deal possible.
There are several reasons you should work with a realtor, including saving time and having a professional handle the paperwork. An agent who is familiar with the area you are looking in will be most helpful in finding a home that meets your desired criteria and fits your budget.
Some people feel that the most cost-effective method is to do it themselves. There are data bases containing real estate listings with public records data, area information, interactive maps and other details. Most of these data bases require a license and a membership fee to access the listings. Some are available to the public for no charge, but you must supply your personal contact information and email address for access.
There are specialized services to accommodate the do-it-yourself home buyer, but this is only recommended for experienced buyers. A first-time home buyer should work with a realtor.
Ella
There really is no great secret to finding a home. Though there are countless theories and techniques, finding a house comes down to perseverance and luck. You must be willing to work at putting yourself in the right place at the right time to find your dream home.
Consider your needs and your desired criteria for a home; number of bedrooms, basement or crawl, garage or shed, lot size, neighborhood, etc… Just look; do not call the number listed in the ad! When you are ready to see homes you will want to work with a real estate agent who will represent you to see that you are getting the best deal possible.
There are several reasons you should work with a realtor, including saving time and having a professional handle the paperwork. An agent who is familiar with the area you are looking in will be most helpful in finding a home that meets your desired criteria and fits your budget.
Some people feel that the most cost-effective method is to do it themselves. There are data bases containing real estate listings with public records data, area information, interactive maps and other details. Most of these data bases require a license and a membership fee to access the listings. Some are available to the public for no charge, but you must supply your personal contact information and email address for access.
There are specialized services to accommodate the do-it-yourself home buyer, but this is only recommended for experienced buyers. A first-time home buyer should work with a realtor.
Ella
3 People the First Time Home Buyer needs on their Team
Heather Dunlop asked:
Many first time home buyers are not sure where to get started. They are ready to buy their first home and want to make sure they don’t make any mistakes. So where do you go first?
There are three people that will be important to the first time home buyer. These people can walk you through the process and help you purchase your first time.
The first person you want on your team is a Realtor. You want to make sure you find a Realtor who specializes in working with first time home buyers. They will have the patience to answer all of your questions and reduce your fears. They have been through the process many times and will be able to anticipate your questions and your needs, making the process easier on the first time home buyer.
Your Realtor can also help you find the other two people you need on your team. Your Realtor will already have relationships with these other people, who are also familiar with working with first time home buyers.
The second person you want on your team is a Mortgage Broker. Again, find a mortgage broker that works with first time home buyers. This mortgage broker will know about the city, state, and federal programs available to help first time home buyers purchase their dream home. They know what kind of loan you can qualify for, how much you will need for a down payment, and the lenders requirements. Your mortgage broker will get your pre-approved so you know exactly how much house you can afford and don’t waste your time looking at houses you can’t buy.
The third person you want on your team is a Home Inspector. As a first time home buyer you are not aware of what is involved in looking at the details of a home to make sure it is safe and will not require costly repairs. Your Home Inspector will go over every nook and cranny and tell you what they find. A good home inspection can save you from buying a home that needs major repairs without you knowing about the. Be at the house with the Home Inspector so you can ask them questions about what they find, giving you a better understanding of the condition of the home.
Build your team with people who specialize in working with first time home buyers. You’ll be glad you spent the time to find the right people to help you.
Beverly
Many first time home buyers are not sure where to get started. They are ready to buy their first home and want to make sure they don’t make any mistakes. So where do you go first?
There are three people that will be important to the first time home buyer. These people can walk you through the process and help you purchase your first time.
The first person you want on your team is a Realtor. You want to make sure you find a Realtor who specializes in working with first time home buyers. They will have the patience to answer all of your questions and reduce your fears. They have been through the process many times and will be able to anticipate your questions and your needs, making the process easier on the first time home buyer.
Your Realtor can also help you find the other two people you need on your team. Your Realtor will already have relationships with these other people, who are also familiar with working with first time home buyers.
The second person you want on your team is a Mortgage Broker. Again, find a mortgage broker that works with first time home buyers. This mortgage broker will know about the city, state, and federal programs available to help first time home buyers purchase their dream home. They know what kind of loan you can qualify for, how much you will need for a down payment, and the lenders requirements. Your mortgage broker will get your pre-approved so you know exactly how much house you can afford and don’t waste your time looking at houses you can’t buy.
The third person you want on your team is a Home Inspector. As a first time home buyer you are not aware of what is involved in looking at the details of a home to make sure it is safe and will not require costly repairs. Your Home Inspector will go over every nook and cranny and tell you what they find. A good home inspection can save you from buying a home that needs major repairs without you knowing about the. Be at the house with the Home Inspector so you can ask them questions about what they find, giving you a better understanding of the condition of the home.
Build your team with people who specialize in working with first time home buyers. You’ll be glad you spent the time to find the right people to help you.
Beverly
Important Facts for First-Time Home Buyers
Anubha Shyam asked:
There are so many things that you have to take into consideration while buying your first home; from location, neighborhood, nearby amenities to price, construction plan and available space. Without proper planning and knowledge of some crucial home-buying facts, you would end up buying something that is highly priced and also no where close to your dream home. For your help, we have compiled a list of essentials that every first-time home buyer should know.
A good credit report will make a difference- All mortgage lenders evaluate the credit report before approving the loan application. A flawless credit report can get you more loan at a better rate of interest. For this reason, spare no effort to make your credit report as faultless as possible. Pay all your bills on time, and get errors and inconsistencies removed from your report. The importance of saving money- You should have adequate amount of money to be able to make the down payment. You can request your mortgage lender to do this. However, if you use your own hard-earned money for the down payment, the lender would get an assurance that he will also get back his money as you won’t step back after investing so much. The need to prepare a financial plan- It is very important to draw a financial plan before even going out to look for a house. With this plan you will get to know two things viz. one, your budget, and two, the kind of home you can actually afford to buy. It will also stop you from over-spending. A proficient real estate agent- The job of a real estate agent is not only to find a house according to your requirements, but also to help you negotiate the price, and detect the imperfections of the house. Home market trends- It is very important to know the current market trends prior to buying your first home. With the knowledge, you will be able to ascertain the true value of the property, and you will also be able to do a comparative study and thereafter choose the best house. Know your desires and requirements- It is very important to ascertain whether your first home is fulfilling all your desires and requirements or not. It is unusually difficult to buy a home, and for most of us, the first home is usually the last one. Hence, do not overlook your needs and desires. A pre-qualification letter makes a difference- A pre-qualification letter proves that you are a genuine buyer and a mortgage lender is ready to help you in your home-buying endeavor. It also provides you the power to negotiate assertively with the seller. Finding the right home- Of course, your real estate agent will help you in your home search, but you can do it on your own too. The internet is a good resource of idyllic properties. You can find your dream home quickly here. Getting the home inspected- The next important thing is to get your home inspected to uncover all the defects, blemishes and imperfections. You can negotiate with the seller persuasively on the basis of the home inspection report. Buying the home- Once, you are fully satisfied with all the aspects of the new home, submit the offer, negotiate and close the deal.
Vincent
There are so many things that you have to take into consideration while buying your first home; from location, neighborhood, nearby amenities to price, construction plan and available space. Without proper planning and knowledge of some crucial home-buying facts, you would end up buying something that is highly priced and also no where close to your dream home. For your help, we have compiled a list of essentials that every first-time home buyer should know.
A good credit report will make a difference- All mortgage lenders evaluate the credit report before approving the loan application. A flawless credit report can get you more loan at a better rate of interest. For this reason, spare no effort to make your credit report as faultless as possible. Pay all your bills on time, and get errors and inconsistencies removed from your report. The importance of saving money- You should have adequate amount of money to be able to make the down payment. You can request your mortgage lender to do this. However, if you use your own hard-earned money for the down payment, the lender would get an assurance that he will also get back his money as you won’t step back after investing so much. The need to prepare a financial plan- It is very important to draw a financial plan before even going out to look for a house. With this plan you will get to know two things viz. one, your budget, and two, the kind of home you can actually afford to buy. It will also stop you from over-spending. A proficient real estate agent- The job of a real estate agent is not only to find a house according to your requirements, but also to help you negotiate the price, and detect the imperfections of the house. Home market trends- It is very important to know the current market trends prior to buying your first home. With the knowledge, you will be able to ascertain the true value of the property, and you will also be able to do a comparative study and thereafter choose the best house. Know your desires and requirements- It is very important to ascertain whether your first home is fulfilling all your desires and requirements or not. It is unusually difficult to buy a home, and for most of us, the first home is usually the last one. Hence, do not overlook your needs and desires. A pre-qualification letter makes a difference- A pre-qualification letter proves that you are a genuine buyer and a mortgage lender is ready to help you in your home-buying endeavor. It also provides you the power to negotiate assertively with the seller. Finding the right home- Of course, your real estate agent will help you in your home search, but you can do it on your own too. The internet is a good resource of idyllic properties. You can find your dream home quickly here. Getting the home inspected- The next important thing is to get your home inspected to uncover all the defects, blemishes and imperfections. You can negotiate with the seller persuasively on the basis of the home inspection report. Buying the home- Once, you are fully satisfied with all the aspects of the new home, submit the offer, negotiate and close the deal.
Vincent
Facts for First Time Home Buyers
Sonia asked:
Are you out for the first time hunting for a house? Finding a home is more complicated than it appears to first-time home buyers. There are a lot of things to be considered. Purchasing a home for the first time is a huge financial step for anyone. In this time of financial crisis, be true to yourself. Your financial capacity and readiness to buy a home are the two biggest problems that can pop up in your mind. Here are some helpful facts for first-time home buyers that can help you make a wise investment.
1. Your Finances. Unless you have all the money to buy a home, you have to go select a mortgage lender to help you financially. A mortgage lender will go through all the details with regards to your finances and you too should do the same assessment of the kind of mortgage lender to choose from. As a first-time home buyer, choose one that offers a fixed rate. A fixed rate maintains the same interest rate throughout the term of your loan. Be realistic of what you have and what you can afford. Never allow your mortgage lender to get you to agree on a term that is definitely heavy on your pocket.
2. Find the best real-estate agent for you. An agent must be someone who will listen to you, easy to get along with and has the necessary skills toaddress your needs. As a first-time home buyer, you should consider a referral from you familya nd friends. They know you better than anyone else and knows what you need.
3. Select a neighborhood. Do not rush into purchasing a home without considering the environment you are about to join to. What kind of neighborhood would you want your kids to grow up into? Your lifestyle?. Is the neighborhood accessible? This means convenient time commuting to and from work. Do consider also the educational side of it. It is convenient to send your kids to a school that is close by, not having them travel all the way across town and create unnecessary stress to both you and your children. Market and hospital accesibilty should also be considered. Most of all, your neighborhood has a great influence on your kids; choose one that provides healthy and good influence on your children.
4. Do a home inspection. Before you decide to buy, do a home inspection first. As a first-time home buyer, it is a must to check out and note on these things. The attic plays a vary major role in your inspection. Most buyers often disregard t the attic. However, the attic can give you clues to a house including the past things that has occurred there. Any roof or trusses damage are not visible as you view the roof but you can see it in the attic. If the rafters have a different color other than its natural wood, it means the house was on fire before. You can also inspect any water damage and be sure to check out leaks and damage in the plumbing throughout the house.
These are just some of the many practical things to note as a first-time home buyer. There are several details you have to undergo in your buying a home for the first time. Buying a home is not only to provide your family a better dwelling than the usual stiffling apartment, but is also your investment of a lifetime. Be practical and wise. Happy house hunting!
Monica
Are you out for the first time hunting for a house? Finding a home is more complicated than it appears to first-time home buyers. There are a lot of things to be considered. Purchasing a home for the first time is a huge financial step for anyone. In this time of financial crisis, be true to yourself. Your financial capacity and readiness to buy a home are the two biggest problems that can pop up in your mind. Here are some helpful facts for first-time home buyers that can help you make a wise investment.
1. Your Finances. Unless you have all the money to buy a home, you have to go select a mortgage lender to help you financially. A mortgage lender will go through all the details with regards to your finances and you too should do the same assessment of the kind of mortgage lender to choose from. As a first-time home buyer, choose one that offers a fixed rate. A fixed rate maintains the same interest rate throughout the term of your loan. Be realistic of what you have and what you can afford. Never allow your mortgage lender to get you to agree on a term that is definitely heavy on your pocket.
2. Find the best real-estate agent for you. An agent must be someone who will listen to you, easy to get along with and has the necessary skills toaddress your needs. As a first-time home buyer, you should consider a referral from you familya nd friends. They know you better than anyone else and knows what you need.
3. Select a neighborhood. Do not rush into purchasing a home without considering the environment you are about to join to. What kind of neighborhood would you want your kids to grow up into? Your lifestyle?. Is the neighborhood accessible? This means convenient time commuting to and from work. Do consider also the educational side of it. It is convenient to send your kids to a school that is close by, not having them travel all the way across town and create unnecessary stress to both you and your children. Market and hospital accesibilty should also be considered. Most of all, your neighborhood has a great influence on your kids; choose one that provides healthy and good influence on your children.
4. Do a home inspection. Before you decide to buy, do a home inspection first. As a first-time home buyer, it is a must to check out and note on these things. The attic plays a vary major role in your inspection. Most buyers often disregard t the attic. However, the attic can give you clues to a house including the past things that has occurred there. Any roof or trusses damage are not visible as you view the roof but you can see it in the attic. If the rafters have a different color other than its natural wood, it means the house was on fire before. You can also inspect any water damage and be sure to check out leaks and damage in the plumbing throughout the house.
These are just some of the many practical things to note as a first-time home buyer. There are several details you have to undergo in your buying a home for the first time. Buying a home is not only to provide your family a better dwelling than the usual stiffling apartment, but is also your investment of a lifetime. Be practical and wise. Happy house hunting!
Monica
First Time Home Buyer Assistance – Can the Seller Contribute?
Steve Hattan asked:
First time home buyer assistance programs such as the AmeriDream and Nehemiah were extremely popular over the last several years. They were popular because the down payment provided to the buyer was considered a gift that didn’t have to be paid back and it covered the entire down payment amount.
Unfortunately, for whatever reason, these first time home buyer assistance programs were put to rest on October 1, 2008. Whether they will be revived is yet to be seen.
So what are the first time home buyer options? If you’re a police officer, fireman or a teacher there are programs designed specifically for you such as HUD’s (Dept of Housing and Urban Development) Good Neighbor Next Door program. If you are not in one of these professions you can check with your local lender to see what other programs or state grants are available.
If all of these options don’t work then it’s time to consider the home seller of the property you would like to buy from.
The way the rules are today, a home seller cannot give a down payment directly to the buyer. For example, if you were going to purchase my home, I cannot write a check to you for $5,000 and then have you use that money for your down payment. In the industry it’s called a ‘RESPA’ violation. Simply put, it’s illegal.
The good news is, under certain types of loans such as an FHA loan, a seller can pay up to 6% of the buyer’s closing costs. When you take into consideration that an FHA loan only requires a three percent down payment it’s possible, in many circumstances, that a buyer could bring very little cash to the closing, especially when the buyer receives prorated tax credits.
What closing costs can a seller pay for the buyer? As a general rule, anything on the second page of the Settlement Statement (an itemized list of debits and credits for both the buyer and seller provided at closing) in the buyers expense column can be paid for by the seller. It used to be that a seller could not pay pre-paid mortgage insurance required by FHA. However, that rule has recently changed and now sellers can pay the pre-paid mortgage insurance.
In summary, first time home buyer assistance programs are no longer under most circumstances. However, if a buyer is securing a FHA mortgage then the seller can pay up to six percent of the loan amount to pay for the buyer’s closing costs without violating any rules or laws. If you are need first time home buyer assistance be sure to investigate FHA loans.
Julio
First time home buyer assistance programs such as the AmeriDream and Nehemiah were extremely popular over the last several years. They were popular because the down payment provided to the buyer was considered a gift that didn’t have to be paid back and it covered the entire down payment amount.
Unfortunately, for whatever reason, these first time home buyer assistance programs were put to rest on October 1, 2008. Whether they will be revived is yet to be seen.
So what are the first time home buyer options? If you’re a police officer, fireman or a teacher there are programs designed specifically for you such as HUD’s (Dept of Housing and Urban Development) Good Neighbor Next Door program. If you are not in one of these professions you can check with your local lender to see what other programs or state grants are available.
If all of these options don’t work then it’s time to consider the home seller of the property you would like to buy from.
The way the rules are today, a home seller cannot give a down payment directly to the buyer. For example, if you were going to purchase my home, I cannot write a check to you for $5,000 and then have you use that money for your down payment. In the industry it’s called a ‘RESPA’ violation. Simply put, it’s illegal.
The good news is, under certain types of loans such as an FHA loan, a seller can pay up to 6% of the buyer’s closing costs. When you take into consideration that an FHA loan only requires a three percent down payment it’s possible, in many circumstances, that a buyer could bring very little cash to the closing, especially when the buyer receives prorated tax credits.
What closing costs can a seller pay for the buyer? As a general rule, anything on the second page of the Settlement Statement (an itemized list of debits and credits for both the buyer and seller provided at closing) in the buyers expense column can be paid for by the seller. It used to be that a seller could not pay pre-paid mortgage insurance required by FHA. However, that rule has recently changed and now sellers can pay the pre-paid mortgage insurance.
In summary, first time home buyer assistance programs are no longer under most circumstances. However, if a buyer is securing a FHA mortgage then the seller can pay up to six percent of the loan amount to pay for the buyer’s closing costs without violating any rules or laws. If you are need first time home buyer assistance be sure to investigate FHA loans.
Julio
Which First Time Home Buyer Programs Are Right for You?
Jeff Ragan asked:
So, you want to buy a home. I congratulate you. Now, you need to know what first time home buyer programs are right for you. Where do we begin?
Let’s get down to the basics. First you want to have your credit file in order. By this I mean, no collections or late payments in the last 2 years.
Assuming this is the case, you can begin shopping around for some first time home buyer programs. There are plenty out there. But, for the sake of time and space in this article, I’m going to share with you two options. FHA and VA.
Once you get a feel for these two programs, you will have the knowledge to talk the talk and walk the walk. There are others programs however.
FHA FIRST TIME HOME BUYER PROGRAMS
Now, hands down the FHA is one of the best first time home buyer programs. Why? It has relaxed credit standards over the conventional loan and also has a low down payment feature.
First let’s talk about the credit requirements. In the past FHA would let you buy a home without any credit score at all. Now they seem to be requesting a score around 620. This is still lower than a conventional loan which requires 700 and above.
A credit file is not all that hard to build if you do not have one. Talk with a large national lender about this. Look for a loan officer that has years of experience with FHA home loans. He/she can give you some ideas.
When it comes to a down payment, FHA since 1934 has offered this 3% low down payment option. This makes it possible for you, the first time home buyer to get into a home with very little money.
In fact, the down payment can even be a gift from a relative or charity. I’ve written other articles about down payment assistance, which are awesome when you see how they work. You can in effect buy a house with no money down.
FHA loans do have MIP or a mortgage insurance premium of 1.75% of the loan amount. You have to pay this up front at the loan closing. This amount is added onto your original mortgage amount. So it increases your payment by about .55% of the loan amount until you pay off the mortgage.
If you ever go to sell a house that has FHA mortgage insurance on it, or pay off the loan early you may be entitled to a refund of this insurance premium. Check with your lender about this.
VA FIRST TIME HOME BUYER PROGRAMS
Now the VA loan program is even better. However, you must be a veteran to take advantage of these first time home buyer programs.
When it comes to credit, the VA loan works much the same way as the FHA home loan. So I’m not going to spend much time on this. VA loans may allow a little bit lower credit score.
With the VA home loan, the down payment and MIP is a horse of a different color.
VA loans require NO DOWN PAYMENT. Yes they are 100% financing. Again this is a benefit for veterans only.
The mortgage insurance premium is another reason the VA loan is for first time home buyers. They do not have any MIP to be paid. HUD guarantees the loan 100%. However, there is a VA Funding fee which could range from 0-3% of the loan amount. If the veteran is injured in combat and can have this documented by the VA, then it is 0% funding fee.
So unlike the FHA loan which your loan amount and payment increases slightly, with a VA loan the payment amount does not increase, but the loan amount may increase because of the funding fee.
This is the best loan option if you ask me.
Let me tell you a brief story about a VA loan I did several years ago. There was this really nice couple with one child that wanted to buy a home.
They came to me for a mortgage. After talking with them I learned he was a veteran. When I discussed the benefits of a VA loan they got excited.
He was an injured Vet and had the paperwork to prove it. He had been permanently injured in the face because of shrapnel.
So a long story made short, they bought a house for $97,000 with no money down and no VA funding fee. If I recall the maximum out of pocket he put into the deal was less than $600.
Now they are buying a home for less than what they were paying in rent. Again, what VA offers is one of the greatest of all first time home buyer programs.
Explore all your options when looking for a mortgage. Ask questions of your loan officer. Be sure to get your education first, then go looking.
Gina
So, you want to buy a home. I congratulate you. Now, you need to know what first time home buyer programs are right for you. Where do we begin?
Let’s get down to the basics. First you want to have your credit file in order. By this I mean, no collections or late payments in the last 2 years.
Assuming this is the case, you can begin shopping around for some first time home buyer programs. There are plenty out there. But, for the sake of time and space in this article, I’m going to share with you two options. FHA and VA.
Once you get a feel for these two programs, you will have the knowledge to talk the talk and walk the walk. There are others programs however.
FHA FIRST TIME HOME BUYER PROGRAMS
Now, hands down the FHA is one of the best first time home buyer programs. Why? It has relaxed credit standards over the conventional loan and also has a low down payment feature.
First let’s talk about the credit requirements. In the past FHA would let you buy a home without any credit score at all. Now they seem to be requesting a score around 620. This is still lower than a conventional loan which requires 700 and above.
A credit file is not all that hard to build if you do not have one. Talk with a large national lender about this. Look for a loan officer that has years of experience with FHA home loans. He/she can give you some ideas.
When it comes to a down payment, FHA since 1934 has offered this 3% low down payment option. This makes it possible for you, the first time home buyer to get into a home with very little money.
In fact, the down payment can even be a gift from a relative or charity. I’ve written other articles about down payment assistance, which are awesome when you see how they work. You can in effect buy a house with no money down.
FHA loans do have MIP or a mortgage insurance premium of 1.75% of the loan amount. You have to pay this up front at the loan closing. This amount is added onto your original mortgage amount. So it increases your payment by about .55% of the loan amount until you pay off the mortgage.
If you ever go to sell a house that has FHA mortgage insurance on it, or pay off the loan early you may be entitled to a refund of this insurance premium. Check with your lender about this.
VA FIRST TIME HOME BUYER PROGRAMS
Now the VA loan program is even better. However, you must be a veteran to take advantage of these first time home buyer programs.
When it comes to credit, the VA loan works much the same way as the FHA home loan. So I’m not going to spend much time on this. VA loans may allow a little bit lower credit score.
With the VA home loan, the down payment and MIP is a horse of a different color.
VA loans require NO DOWN PAYMENT. Yes they are 100% financing. Again this is a benefit for veterans only.
The mortgage insurance premium is another reason the VA loan is for first time home buyers. They do not have any MIP to be paid. HUD guarantees the loan 100%. However, there is a VA Funding fee which could range from 0-3% of the loan amount. If the veteran is injured in combat and can have this documented by the VA, then it is 0% funding fee.
So unlike the FHA loan which your loan amount and payment increases slightly, with a VA loan the payment amount does not increase, but the loan amount may increase because of the funding fee.
This is the best loan option if you ask me.
Let me tell you a brief story about a VA loan I did several years ago. There was this really nice couple with one child that wanted to buy a home.
They came to me for a mortgage. After talking with them I learned he was a veteran. When I discussed the benefits of a VA loan they got excited.
He was an injured Vet and had the paperwork to prove it. He had been permanently injured in the face because of shrapnel.
So a long story made short, they bought a house for $97,000 with no money down and no VA funding fee. If I recall the maximum out of pocket he put into the deal was less than $600.
Now they are buying a home for less than what they were paying in rent. Again, what VA offers is one of the greatest of all first time home buyer programs.
Explore all your options when looking for a mortgage. Ask questions of your loan officer. Be sure to get your education first, then go looking.
Gina