Not everyone is qualified to buy right now, or may not want to.
But if you are considering it, know that the interest rates are some of the best we have seen in decades. And we don’t know how long they will remain that way. You might be surprised at what you can qualify for AND that your mortgage payment (plus interest) may be less than what you are currently paying for a rental.
If you need a mortgage person to talk with, feel free to let me know. I have several I can recommend highly to you.
The last stage in the approval of your loan is for the lender’s underwriter to review all the documents in the file – your financials, the application, the appraisal and more. The underwriter is the final decision maker on whether to approve the loan or not.
Beware that this step can take time, sometimes more time that you hope for or expect. I have had two recent situations where underwriting took more than 2 weeks beyond the agreed-upon date in the contract for removing the buyers’ contingencies.
The point here is to not be surprised IF the approval takes longer – underwriters are scrutinizing everything in more depth and it takes time.
You will also need to watch your dates in your contract so you can request the necessary extensions with the seller in time.
I’m attending the annual convention for the Certified Residential Specialists in Las Vegas.
I’m a strong believer in continuing education about technology and strategies for me to better help my buyer clients in this challenging market and I will be sharing some of what I learned and some ways that I can better assist you accomplish your goals in this market.
Stay tuned.
First Time Home Buyers – If you are a independent contractor or have your own business, be prepared for more grilling as you go through the loan process.
The days of no doc loans are gone, and you can certainly get a loan as a contractor or small business owner, but you are going to have to provide a lot of documentation – tax records, P and L statements, bank statements and more.
You should expect that once all the documentation gets to the underwriter you may be subject to even more scrutiny, with requests for more information which can delay your loan approval. I only say this because of a client’s experience…someone with stellar credit and no debt. The banks are much stricter now than they have been in years, and it’s not about you personally. They are just being extra cautious, and taking their time about it.
Keep in mind that if you are putting down less than 20% you will be subject to PMI (Private Mortgage Insurance) and the PMI Company will very likely scrutinize things even further after the underwriter has.
This is NOT to scare you, but to simply prepare you for a process that may take more time and require a lot more record checking. And it seems banks do this in pieces rather than all at once. And each person in the chain who reviews things looks at different items or may ask for different information.
Keep the end goal in mind as you feel the frustration mounting.
As a new buyer you will likely have a ton of questions. You may feel that you know little or nothing at all about buying a home.
So what?! Ask the questions you need to ask.
In my opinion there is no question that you should not be able to ask your agent, nor should you be embarrassed or feel foolish for doing so. You may not like the answer, or your agent may not have a good answer. But withholding a question is a mistake.
You deserve, and NEED, to know. Being educated will help you make better decisions.
Afraid to ask the question?
DON’T BE!! Think how foolish you’ll feel if you don’t ask the question and later find out that you should have.
There are lots of Wait and See moments in the real estate transaction, especially these days. As a first time home buyer, these Wait and See moments can be frustrating.
For example:
There’s no getting around the fact that it takes time, sometimes far longer than expected – a short sale purchase being, perhaps, the most aggravating and time consuming – so being prepared for this and having contingency plans is important.
As is being prepared for the emotions and anxiety that arise as time stretches on and goes beyond what is expected and hoped for.
First time home buyers can no longer take advantage of the Federal First Time Home Buyer Tax Credit, but if you are in California you CAN take advantage of the first time home buyer tax credit of up to $10K that California has over a 3-year period.
Read more about the California 2010 First-Time Buyer Tax Credit
A number of first time home buyers in Southern California may also qualify for one of the down payment assistance programs in San Diego.
These programs have income (maximum) guidelines based on total household size, but they offer a pretty decent amount of money for down payments (and in some programs for closing costs). The cool thing is there are no payments until you sell the home.
Want to learn more?
Read the article I just posted on Down Payment Assistance Programs in San Diego.
I decided to re-post this article that I wrote quite some time ago. Given the difficulties in this market, with short sales and foreclosures (REOs or bank-owned properties), knowing if you are really ready to buy is critical. Not everyone is prepared for what they have to deal with when buying a home.
And certainly being financially able is essential or you are wasting your time.
One question to ask yourself is if you are REALLY ready to buy or are you just looking right now? While you may be thinking you are ready, your behavior may suggest the time is not quite right.
The questions below will help you determine if you are truly prepared to buy…emotionally, psychologically and financially.
You can download some helpful forms and checklists about short sales and REOs on the home page of my website.
Visit my Savvy Buyers Page to download the “Buyer’s Lifestyle Questionnaire” and my “What’s Important to You in Your Home Search Questionnaire.“
This article is specifically written for buyers in California where we use escrow companies, as opposed to attorneys, to complete the transaction. But lots of this information may still apply, and it’s worthwhile to consider the overall concept – thinking ahead about your CLOSING COSTS.
Folks who have bought before will have some idea of this already, but first time buyers are often surprised at the fees they have to pay, on top of the mortgage, during their purchase. A savvy agent can, and should, share information with you about the fees you can expect, some of which depend on the price of the home.
If you aren’t being told, or the topic has not yet come up, ASK. You don’t want any big surprises.
The other thing to keep in mind is that in the case of SHORT SALES and REOs (foreclosures) the fees may be higher because the bank will not approve paying some of the normal seller-paid fees.
READ MORE: Some Home Buying Costs You ay Not Think About (Part 2 of 3) – Escrow and Closing Costs
Someone kindly sent along a link to a really useful article about protecting your home from fires. So I thought I would, and should, share it.
There are links to 10 different GUIDES, some interactive, as well as a list of ACTIONS TO CONTAIN FIRES and suggestions on FIRE PREVENTION TOOLS homeowners should have. Good reading and worth sharing with friends, neighbors and family.
25 Tips to Protect Your Home From Fires
