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Old 03-25-2014, 10:40 PM
 
5 posts, read 6,528 times
Reputation: 13

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Im looking into getting my first house. I'm not sure the best place to go for pre approval.
I don't want to go place to place and have each place run my credit.

I've been reading up in FHA and Fannie mars home path loan...
I'm not sure which would work best for me...

I have good credit, I have 100% on time payments! and zero negative remarks..

My debit to ratio is high, but I have just paid off all of my debit, it's still hasn't reflected on my credit report yet though.. So pretty soon debit will be zero.

Should I wait for pre approval until it hits my credit report?

Also, since I paid off the debit, I don't have much money left for down payment/closing
Are there programs or grants I could apply for?

What's better with little to no money lender FHA or home path, or going through a credit union for the a FHA..

Any advice, guidance, suggestions... Would be greatly appreciated...
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Old 03-25-2014, 11:28 PM
 
Location: Southern California
4,453 posts, read 6,139,431 times
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I wouldn't rush into FHA, you can save more by going with conventional. You paid off your credit cards which is good, but now you are left with little to no cash reserves, which is bad.

You are posting in the LA forum, so you know prices are high. FHA will make payments even higher due to mortgage insurance. Wouldn't you rather have a nice place for cheaper just by save a few more thousand dollars? I still think it is a seller market which mean, they probably won't want to pay the extra FHA insurance of 1.75% for you, but the call is ultimately yours.

Pre approvals are worthless, you should create your own budget of how much you can spend and ask how large a loan it equates too.
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Old 03-25-2014, 11:30 PM
 
5 posts, read 6,528 times
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Thanks...

I'll keep that all in mind, I'm doing research right now. Trying to figure out my best option.


How much do you think I should save?
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Old 03-25-2014, 11:36 PM
 
5 posts, read 6,528 times
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Quote:
Originally Posted by thelopez2 View Post
I wouldn't rush into FHA, you can save more by going with conventional. You paid off your credit cards which is good, but now you are left with little to no cash reserves, which is bad.

You are posting in the LA forum, so you know prices are high. FHA will make payments even higher due to mortgage insurance. Wouldn't you rather have a nice place for cheaper just by save a few more thousand dollars? I still think it is a seller market which mean, they probably won't want to pay the extra FHA insurance of 1.75% for you, but the call is ultimately yours.

Pre approvals are worthless, you should create your own budget of how much you can spend and ask how large a loan it equates too.

I tried to reply to your pm, but it said I reached my daily limit??
1 PM a day?


Thanks... I will give him a call.. Was the number a direct phone number? You didn't mention a name.
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Old 03-25-2014, 11:47 PM
 
Location: Southern California
4,453 posts, read 6,139,431 times
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People get themselves in a real bind when they blow their cash on a down payment then they have $2000 in plumbing $1000 in car repairs, it is not a position you want to be in. 5% down is minimum but many recommend 20%, some even recommend not at all in LA right now. I think LA offer a lot of growth and employment opportunity. Despite a large unemployment % there are still a whole lot of or working people.
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Old 03-25-2014, 11:58 PM
 
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Whats wrong with FHA approved loans. If you qualify... don't they pay up to 96% ? Only 4% down sometimes. Of course you will have to pay the insurance if you can't put at least 20% down.
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Old 03-26-2014, 12:21 AM
 
Location: Southern California
4,453 posts, read 6,139,431 times
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It just cost more, you might get a lower rate but you pay more in insurance up front and monthly. Regardless of credit score and down payment, you are paying the same % in mortgage insurance on FHA. With conventional and PMI a better score and bigger down get you lower PMI payments. Unless you do a 15 year or pay 10% down with FHA, you'll have the mortgage insurance for the life of the loan. PMI can fall off.

Sure if you want to speculate on home prices, you'll get the FHA and pay or finance the 1.75%. hoping to get your money back when you sell, but chances are most people won't sell. If you are going to speculate, why not go all the way and get an 5/1 FHA ARM?
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Old 03-26-2014, 12:50 AM
 
50 posts, read 69,634 times
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Most sellers in LA won't even look at an offer if FHA is attached. The market is still hot and there is a lot of competition, many with all cash. Best to go 20% down avoid the mortgage insurance and get the lowest rate. FHA loans are low downpayments, but they will kill you with fees & insurance, which equals both high monthly payments and little equity. Most sellers will cover some or all of closing costs if the deal is structured right. If you don't have a decent down payment, don't even bother making an offer in any semi desirable part of LA. As I said before, most sellers won't even look at a FHA offer because of all the extra leg-work and lower chances of closing and because of the ten other, more attractive offers sitting in front of them.

Don't bother with pre-approval, it means nothing to anyone. Better off getting pre-qualified and having someone review your actual docs. Also, I had better luck with a direct lender then my banking institution, or mortgage brokers.

You do realize that a crappy starter home in greater LA starts at 450K+ right? That is unless you want to live in Van Nuys, South LA, or East LA.

Last edited by WheelinDealin; 03-26-2014 at 01:53 AM..
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Old 03-26-2014, 01:12 AM
 
Location: Southern California
4,453 posts, read 6,139,431 times
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Quote:
Originally Posted by WheelinDealin View Post
You do realize that a crappy starter home in greater LA starts at 450K+ right? That is unless you want to live in Van Nuys, South LA, or East LA.
Two weeks ago I saw a decent starter home in South Torrance for 450k. They are even more common in North Torrance and Harbor Gateway. Condos near DTLA are under 300k. Homes in Gardena are 300k.
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Old 03-26-2014, 01:44 AM
 
50 posts, read 69,634 times
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Don't forget the $400+ a month HOA fees that go along with those condos near DTLA. Double that in some buildings in DTLA. Who the hell wants to live in Gardena?
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