Save your money, wait a few years, house prices are still declining. Good Luck

Home,

You ask a very common question, that in my view, many of us cannot honestly provide a viable, definitive answer to. In 2008, we advocated homebuying based on Bush's 7,500 payback tax credit, only to see Obama elimate the payback just months later, thereby producing some irrate customers . . . how were we to know this would happen. Having said that in today's market, predicting the future is more diffcult than any of us can have imagined.

In my view, it's 6 of one half dozen of the other . . . therefore, if your current personal situation affords you the opportunity to buy, then I'd say go for it. @ 3.5% of $190K you'd be looking @ $6,600 down, @ 10% you'd be looking at $19k down . . . . can us really save another $13 over a 2 year term and secure a loan at potentially a higher interest rate?

While I rarely advocate the "now is the time to buy" minus real data, I would say in your circumstances, that it might be in your best interest to go for it now . . . while the numbers are uncomparable . . . rather than wait, only to learn that homebiyuying will be more difficult.

Love and Peace
Francesca Patrizio, Realtor, ePro
Francesca@PatrizioRE.com

I agree with all the responses so far. Take advantage of the low rates and low home prices available now. What you will gain in a "few years" could be negated by the rise in prices and/or rates. If you are a first time homebuyer, the $8,000 tax credit makes you come out ahead in the game....but only if you close by Nov. 30, 2009. Watch the time lines if you are a first time homebuyer. If you end up wanting buying a short sale, it can take several months, you don't want to lose the tax credit because an bank would not respond quickly enough and approve the offer so that you can close by Nov. 30th.

Hello!
3.5% or 10% down payment are almost the same: you still have to pay PMI (private mortgage insurance).
If you are planning to put down 20%, this is the different story: you will save around $100-120 on your monthly payments, but on another hand rate could be (and probably will) be higher, market may shift to seller benefits again. I would not wait. Remember you are buying home for YOURSELEVES.
Sincerely,
Yelena

I would say buy now, get your 8k tax incentive. The difference in payment between 3.5% and 10% down(assuming rates are the same-and they'll be higher in the future) is about $90-$100 a month in payment.

Why wait? Buyers who choose to wait until prices come down more are also gambling that interest rates will hold steady or drop. What is not widely understood is the impact interest rates can have on the real monthly costs of homeownership. Even a 10 percent drop in home prices is immediately nullified by a mere 1 percentage point increase in interest rates on a 30-year mortgage loan.

Talk to your lender and see the figures – Have him/her give you a few different scenarios. That should put you in a better position to make a decision.

But the bottom line is that nobody can guarantee where the interest rates or prices will be in the coming years.

Homeagain,

It is better to buy FHA now in a buyers market. Right now there are tax credits of up to $8,000.00 being given to first time home buyers. You are considered a first time home buyer if this your first time buying a home or if it has been more than three years since your last home purchase.

If you wait a few years to save up 10% down, you will be running the risk of putting that 10% down on a higher purchase price and comming out in the end with a higher mortgage payment. In addition, the tax credit for first time buyers is only available to December of 2009.

It makes good financial sense to purchase now. Hope this helps you.

Annmarie Howley
Coldwell Banker Flanagan Realty
Toms RIver, NJ 08753
732-330-8903

FHA mortgages are a great option for people in your situation. My opinion is that if you wait a few years, interest rates & prices will most likely be higher than they are today, so I don't see any upside in waiting.