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Old 05-27-2015, 07:55 AM
 
736 posts, read 563,219 times
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Quote:
Originally Posted by sgoofi View Post
Thanks so much for your insight Pfhtex. Just for reference, our budget is $200-275k. We're also able to extend our lease in our current rental home so we don't have to worry about moving twice. My major concern in refinancing, although it will be a cost savings in the long run, would be the costs involved in doing the refi in the first place. My mind can't help but wonder if I could just save the money, and with a little prayer, hope that I can still get a good deal next year. Or is that just a pipe dream?



I don't exactly understand what you mean. It's because of the Californians coming here that home pricing has gone up. Are you saying that prices will come down regardless of their move to DFW?
I meant that real estate forecasters did not incorporate into their predictions the number of people moving out of California to Texas, or North Dallas. They say that mid to late 2016 will be the optimal time to buy due to investors unloading their holdings. From there, you'll have millenials being forced to buy homes later in the decade due to constant rental increases.
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Old 05-27-2015, 08:10 AM
 
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Quote:
Originally Posted by sgoofi View Post
I wish I knew.



With interest rates potentially rising, it's unlikely I'd be able to refi with any savings and we already planned on paying back the loan faster than what was required for a 30 year.
So wait or don't wait.

There is a saying.. beggars can't be choosers. If you have no other choice or will be locked out of the market next year do what you have to do now.

Also pre approval never hurts or costs anything.
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Old 05-27-2015, 09:16 AM
 
77 posts, read 70,850 times
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Quote:
Originally Posted by frankrj View Post
I meant that real estate forecasters did not incorporate into their predictions the number of people moving out of California to Texas, or North Dallas. They say that mid to late 2016 will be the optimal time to buy due to investors unloading their holdings. From there, you'll have millenials being forced to buy homes later in the decade due to constant rental increases.
Oh, I understand.

Quote:
Originally Posted by so954 View Post
So wait or don't wait.

There is a saying.. beggars can't be choosers. If you have no other choice or will be locked out of the market next year do what you have to do now.

Also pre approval never hurts or costs anything.
Very true, preapproval doesn't hurt and for all I know it may take me a year to find something in the first place.

I'm also wondering if I'm panicking over nothing. If I only consider inventory, maybe N. Garland inventory and housing appreciation won't really be affected since most of the Californians are buying in Plano and Richardson.
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Old 05-27-2015, 09:56 AM
 
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It's dangerous to just assume home prices will continue to increase and buy out of fear of missing out. Lots of people get screwed that way. FHA loans are a terrible deal right now IMO.
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Old 05-27-2015, 09:59 AM
 
12,404 posts, read 9,209,597 times
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Quote:
Originally Posted by sgoofi View Post
I wish I knew.



With interest rates potentially rising, it's unlikely I'd be able to refi with any savings and we already planned on paying back the loan faster than what was required for a 30 year.
How much do you expect rates to rise, and how fast are you planning on paying the loan off?

If you are planning on paying the loan off on a 15-year schedule or faster, one option might be to first get the FHA loan, and then refi after a year or two into a 7/1 ARM. This way you will probably not have a higher rate when you refi. By the time you get to the adjustment, if you pay on a 15-year schedule on both loans, you'll only owe about half of the original loan amount, so a rate hike won't matter much since it will only apply to the (greatly reduced) loan balance at the time.
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Old 05-27-2015, 10:34 AM
 
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California is not the only thing driving the North Texas housing market.

As OP mentioned, a massive new HQ for Toyota is just one component among other corporate relocations and expansions in that area, that will drive jobs to the area. McKinney and Frisco are among the Top places to live in America, as listed by several sources readily available for research. Plano, Richardson, Garland, Dallas, etc., will all reap the benefits of this growth.

With that budget, in that area, I think you might be wise to sit tight, keep the lease month-to-month, or do a six-month-er, and realize that you are in control. If you find the Home of your Dreams, you have the power to pull the trigger and get into it.
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Old 05-27-2015, 10:36 AM
 
77 posts, read 70,850 times
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Quote:
Originally Posted by FCNova View Post
It's dangerous to just assume home prices will continue to increase and buy out of fear of missing out. Lots of people get screwed that way. FHA loans are a terrible deal right now IMO.
That's definitely true. However, with the suggestion of refinancing to a conventional within a year, is it null and void?

Quote:
Originally Posted by ncole1 View Post
How much do you expect rates to rise, and how fast are you planning on paying the loan off?

If you are planning on paying the loan off on a 15-year schedule or faster, one option might be to first get the FHA loan, and then refi after a year or two into a 7/1 ARM. This way you will probably not have a higher rate when you refi. By the time you get to the adjustment, if you pay on a 15-year schedule on both loans, you'll only owe about half of the original loan amount, so a rate hike won't matter much since it will only apply to the (greatly reduced) loan balance at the time.
We planned to get a 30 year, but paying it off within 15 years so refinancing into an ARM may be a good idea. Love creative financing!
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Old 05-27-2015, 12:14 PM
 
2,188 posts, read 2,515,902 times
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Quote:
Originally Posted by sgoofi View Post
That's definitely true. However, with the suggestion of refinancing to a conventional within a year, is it null and void?
Refinancing isn't free. Also, what if you can't refinance in a year because home prices drop and you're stuck in a really expensive FHA loan for the foreseeable future? If your reasons for wanting to buy are compelling enough(found the perfect place, renting is hard because of a pet or whatever, just sick of renting for whatever reason, etc) then sure go for it. If it's just because you feel like the housing market is passing you by I'd be cautious about rushing into it. Just my opinion though
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Old 05-27-2015, 12:20 PM
 
3,319 posts, read 7,259,582 times
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Quote:
Originally Posted by FCNova View Post
Refinancing isn't free. Also, what if you can't refinance in a year because home prices drop and you're stuck in a really expensive FHA loan for the foreseeable future? If your reasons for wanting to buy are compelling enough(found the perfect place, renting is hard because of a pet or whatever, just sick of renting for whatever reason, etc) then sure go for it. If it's just because you feel like the housing market is passing you by I'd be cautious about rushing into it. Just my opinion though
Gotta say, I totally agree. At purchase, FHA will roll in a big ole' 1.75% Mortgage Insurance premium, immediately reducing equity from 3.5% to 1.75% equity. This makes refinancing into a conventional WITHOUT additional cash a veritable impossibility.

The reason I opened that option up for OP was because they have the cash to put as much as 15% down, in a great market, and were open to that option, they simply do not qualify for Conv right now due to Time Since Short Sale guidelines.

You can't bank on appreciation alone getting you to a position to even refinance at 95% of the value, because that Conventional Refi will involve not only closing costs, but possibly a complete re-fill of the Escrow account at closing. Sure you might get an escrow refund from your fha lender, but not until a month or so AFTER you close the Conv refi.
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Old 05-31-2015, 03:07 PM
 
2,683 posts, read 4,216,692 times
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I would say wait. Never let the pressure of "I might be locked out of the market next year" push you to make a hasty decision today. If the market shoots up so much in just one year to the level that you will struggle to get in, then happily wait more years.
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