Find out if you can afford a Mortgage without the Mortgage!

It's natural as a First Time Home Buyer to have the "Fear" of a mortgage. Paying rent all your life and never having such a large payment does sound intimidating at first. Well I have the solution to help ease that fear!!!

Solution:

Step #1: Go talk with a Bank or Mortgage Broker/Banker to see if you can qualify for a loan. This will allow you to know how much you can purchase and what the estimated monthly payment would be for your specific scenario.

Step #2) THE MOST IMPORTANT STEP OF ALL!
Take the difference between what you currently pay in Rent and what your propsed New Mortgage payment would be. Take the difference and put it into a Savings account for 3 months. This will allow you to see what it would be like to actually have a mortgage without the committment! See how life would be.... if it feels tight consider lowering your purchase price, if it's comfortable stay at the proposed payment, and if life still seems very good, explore the opportunity to increase your purchase price.

For Example:
If you pay $2,000 a month in rent and your payment would be $3,500 a month for a mortgage. Take $1,500 a month and place it into a savings account as if you were paying a mortgage. At the end if you decide to purchase a home you will have saved money for moving expenses or even New Furniture and you will already know what it is like to have a Mortgage!

Why let Fear control your decision? Try this out and take away the fear of a mortgage and the "un-known".

30 Days VS. 3 Plus Months - You be the Judge!

The wire is down for First Time Home Buyers to cash in on the $8,000 tax credit. April 30th you must be in contract and close by June 30th. You still have the opportunity to take adavantage of the tax credit.

Buying a home that is being sold by a seller and not a bank may be your only option soon. "Regular" sales or a home that is being sold by a seller and not a bank will allow you to close an escrow around 30 days. Short Sales are taking so long that it might be 3 months before you hear back from the bank and at that time the answer could still be no. Taking that long for a response might put you out of game for the credit.

But I can get a better deal when I buy a short sale.... right?

Sellers are very aware of Today's market and understand that they are going against banks. Banks are very aware of the market as well and won't let a home go for any price either. Having your Realtor negotiate with a seller could be more beneficial. A lot of banks will not allow for the buyer to receive credits to help pay for closing costs. You have a better chance at trying to ask a seller to help pay some or even all closing costs. Buying a home from a Seller might actually be a better choice of the two. Are you willing to wait for the bank to respond over 3 months but have your interest rate increase? If this were to happen that Short Sale might actually cost you more in the long run. See examples below:

"Regular" Sale: Seller & Buyer
List Price: $500,000
Seller Pays 3% Closing Costs: $15,000
Buyer Pays: $475,000
Payment at 5.125 Interest with 20% Down: $1,708.00 (Estimate)

Short Sale: Bank & Buyer
List Price: $500,000
Bank does not allow credit for closing costs
Buyer Pays: $500,000
3 month Response time interest rates go to 5.25%
Payment at 5.25 Interest with 20% Down payment: $1,750.00 (Estimate)
Buyer out of pocket for closing costs $15,000


Is the short sale reall worth waiting for? You be the judge!

***Payments do not include HOA's or Property Tax. They are estimates and for example purposes only!

Beat the Clock - Credit Soon to Expire!

First Time Home Buyers have a great opportunity to take advantage of the $8,000 Tax Credit. Unfortunately even this great opportunity does have an expiration date!

What makes a First Time Home Buyer?

As long as you have not owned property within the last 3 years you are considered a First Time Home Buyer. You must intent to live in the property and have it has your primary home. Can not be used for investment properties or second homes.

Tax Credit Timelime:
April 1st, 2010 - Must be in Contract on a home (In Escrow)
June 1st, 2010 - Must Close Escrow on your property

Please call George today for more information or to take advantage of Today's Buyer incentve Market!

First Time Home Buyers Have A Unique Advantage in Today's Mortgage Market

Mortgage rates have fell for the third straight week. The credit markets are still tight but have loosened up significantly from 90 days ago.

Buyer Advantages in Today's Market:

#1) Low Interest Rates
#2) Opportunity to Negotiate with Sellers to pay for Closing Costs
#3) $8,000 Tax Credit available to First Time Home Buyers

What to Prepare for when applying for a loan;

#1) Provide Bank Statements
#2) W-2 Wage and Tax Statements
#3) Pay Stubs
#4) Provide Assets (ie: 401K, IRA's, Retirment Funds)
#5) Clean up Credit Score - The highe the credit score the better qualifying terms)

It’s critical that you have a down payment because lenders want to see that you have skin in the game. Mortgages insured by the Federal Housing Administration require a 3.5% down payment, which can come from a family member, employer or charitable organization as a gift. For a non-FHA-insured loan, lenders are requiring a larger down payment.