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ok, so I'd really like to buy a home someday soon, but I have read that it's better to shop for financing as the first step.
My question is: should I talk with my bank, just to find out how much and what type of a loan I could qualify for? (I know that I can get VA financing), and I want to look into 1st time home buyer loans as well.
I just don't want to "waste" anyone's time if I don't buy within a certain time? (I'd like to see if I could use the $8000.00 home buyer credit also) I had plans to work overseas, and I'm still thinking over that decision, but I'm curious about my chances of buying a home as well.
(Sorry this was a long-winded question!) Any helpful ideas? thanks!
I think its a good ideal to do your research, the first step is to figure out what you want in monthly expenses. I believe that a well run household will allocate 25% of the money taken in each month to the cost of shelter. That's true for renting as well as a home purchase. A mortgage lender may be able to qualify you for more but you shouldn't extend yourself much beyound that. You can use the net to determine what current rates are and calculate the monthly payments for an amount borrowed.
You are actually a bit late on the $8000 home buyer credit, you need to close by Dec 1,2009. So in order to take advantage you would need to make some quick decisions. I don't recommend making quick decisions when looking to purchase a home, especially your first.
You should know intuitively if you have good credit. If you pay your bills on time, then you probably have a good credit score. You should check your credit score once a year anyway.
If you have good credit then you will likely be able to find mortgage money. If you are in a rural area then USDA even has 100% financing. Check on USDA loans even if you don't think of your area being rural, you'd be surprised what areas qualify.
If you decide to purchase a home, then you are correct, the first step is to become pre-approved for a loan. Although it may sound self-serving I also believe that finding a good real estate agent can be a good first step. Look for someone that is experienced with first time buyers, someone that will be more of a consultant and less of a sales person.
If you are not comfortable having the maximum flow out the door then shop below the max. It is up to you.
If your casual search of newspaper and online listings find that there may be some properties that you are interested in and you are comfortable with their asking price then I would consider how long you intend to live in the property. The best tool that I have seen to allow you to test out the various costs of renting vs buying is far and away this one: http://www.nytimes.com/2007/04/10/bu...T_GRAPHIC.html
If you think you will be in the area long enough to justify owning I would then AND ONLY THEN meet with several loan sources. I recommend at least one each of credit union, traditional mortgage broker, and normal bank. You should not care too much about rates at first, but you want a trustworthy firm that has people that communicate honestly and in a timely fashion. They should explain what fees and total costs you should expect and do a free analysis that confirms the data about what you can afford.
I would then recommend diving more seriously into the search for homes and evaluate potential buyers agents.
Although this may sound like a lot of work I am sure that start to finish you could do this in just under a month and if things go really well you could be closed and in a new home in well under 90 days.
Also most loans are taking 45 days to close due to the new HERA, HOEPA regulations. So if you aren't under contract for a house by Oct 15th, chances are you won't get the tax credit.
thank you for the info! I was thinking of using a buyer agent, because they look out for the buyer's interest, at least this is what I understood?
Quote:
Originally Posted by FLBob
I think its a good ideal to do your research, the first step is to figure out what you want in monthly expenses. I believe that a well run household will allocate 25% of the money taken in each month to the cost of shelter. That's true for renting as well as a home purchase. A mortgage lender may be able to qualify you for more but you shouldn't extend yourself much beyound that. You can use the net to determine what current rates are and calculate the monthly payments for an amount borrowed.
You are actually a bit late on the $8000 home buyer credit, you need to close by Dec 1,2009. So in order to take advantage you would need to make some quick decisions. I don't recommend making quick decisions when looking to purchase a home, especially your first.
You should know intuitively if you have good credit. If you pay your bills on time, then you probably have a good credit score. You should check your credit score once a year anyway.
If you have good credit then you will likely be able to find mortgage money. If you are in a rural area then USDA even has 100% financing. Check on USDA loans even if you don't think of your area being rural, you'd be surprised what areas qualify.
If you decide to purchase a home, then you are correct, the first step is to become pre-approved for a loan. Although it may sound self-serving I also believe that finding a good real estate agent can be a good first step. Look for someone that is experienced with first time buyers, someone that will be more of a consultant and less of a sales person.
If you are not comfortable having the maximum flow out the door then shop below the max. It is up to you.
If your casual search of newspaper and online listings find that there may be some properties that you are interested in and you are comfortable with their asking price then I would consider how long you intend to live in the property. The best tool that I have seen to allow you to test out the various costs of renting vs buying is far and away this one: http://www.nytimes.com/2007/04/10/bu...T_GRAPHIC.html
If you think you will be in the area long enough to justify owning I would then AND ONLY THEN meet with several loan sources. I recommend at least one each of credit union, traditional mortgage broker, and normal bank. You should not care too much about rates at first, but you want a trustworthy firm that has people that communicate honestly and in a timely fashion. They should explain what fees and total costs you should expect and do a free analysis that confirms the data about what you can afford.
I would then recommend diving more seriously into the search for homes and evaluate potential buyers agents.
Although this may sound like a lot of work I am sure that start to finish you could do this in just under a month and if things go really well you could be closed and in a new home in well under 90 days.
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