Sompur â€“ I recommend that you take a serious look at your spending. I donâ€™t know what your outlays are, but you need to start accumulating cash. Cash will be king as this market continues to unwind â€“ and youâ€™ll see that these days you really need to have 20% down.
Also â€“ as you can see the prices do not reflect reality. Donâ€™t worry â€“ the blood is in the streets in LI and the Zombie hoards are on the march. Start saving AGGRESIVELY and enjoy the show.
Also - prices have come down - but it's the INTEREST RATES that are SO GOOD for first-time home buyers (or any buyer for that matter). Don't solely analyze the price. "Saving" $30,000 in price could COST you 120k in interest payments over the loan if rates go up (which they very well could) in the future.
In terms of real estate being "way over priced" - prices have dropped more than 15% over the past 22 months in general. Additionally INTEREST RATES are LOW. Do not think that "saving more money" to put more of a down payment is the answer and stop there. I'm not saying jump in and buy - what I am saying is consult a professional Real Estate Agent (me) and a mortgage consultant. You need information. Holding off indefinitely may very well cost you in higher interest rates - so waiting to buy a home 10 months from now for $30,000 less is great BUT paying 7% interest on the loan could cost you over $100,000 during your loan term. 401k's are great - but real estate - buying it - overall is a great investment for one gigantic reason - you totally OWN it. You don't own the companies in a mutual fund. People are losing their shirts in the stock market and think nothing of it. It's crazy. Think of the Enron employees - I mean, they lost everything. The real estate market right now is great for buyers right now. If you have steady jobs, good income and money to put down - FHA loans are simply fantastic.
Your numbers don't add up with regard to your combined income - unless again you have 100's of thousands of dollars in debt and bad credit.
After some research over the past few days, we have decided to wait to buy our first home...mostly because we want to accumulate 20% (we are shooting for 25%) downpayment. Hopefully while we save up/stregnthen our credit score, the current mortgage mess will sort itself out and sanity (in terms of home prices) will return. It is sad that we as a society have to come to think of a home as one of THE main tool to make money off of :-(
As I said earlier, we are conservative folks and do not believe in ARMs or Interest-only loans or any other new type of loan other than the traditional 15-yr or 20-yr mortgage. We would also like to buy a home with minimum brokering..
Talk to you all in1.5 years from now.... hopefully sooner if the home prices reflect realism earlier.
Thank you once again and good luck to all those in the real estate buisness.
Also offered is a Closing Cost Assistance Loan of up to 5% of the loan amount.
The max purchase price is $ 550,000.00. There are income limits for New Yorks different counties.
For further information feel free to contact me.
Continental Home Loans Inc
175 Pinelawn Rd Suite 400
Melville New York 11747
( 631 ) 390 -6185
If you take the 140K you make per year - break down to monthly - that is $11,600 per month. FHA will allow 41% of your monthly income to go toward housing and monthly debt. That figure is $4756. From the $4756 subtract all revolving/interest debt. What is left is what is allowed for housing. Let's say since you are conservative you have $1500 monthly in revolving/credit debt - that leaves $3256 for housing. Not sure what the tax base or insurance base is for your area - worst case lets say property taxes are 3 t% of the sales price - 4200 yearly and insurance is 1500 yearly - 5700 yearly divided by 12 = 475 monthly - subtracted from the $3256 - 2781 for PI = $463K for house - based on 6% interest rate for 30 years.
If you can take this example and plug in the correct numbers - you will get an idea of qualification.
Now has never been a better time to buy. Check with you accountant about how much more money this will put into your pocket every year. Hope this helps.
So, the best time to buy is now if you find a house that you like. Arm yourself with a good buyer's broker and go shopping.
How you doing, if you are looking to buy house this is your best time, As you heard feds already stop cutting rates and interest rates will be going higher which they already did, You can buy house with low down payment of 3% with a fha program, i am not trying to be pushy but there are programs out there which can really help you out.
When saving, you must save for your down payment, closing costs, possible points to lower your rate, and cash left over. Personally, I would suggest at least 20K. Having cash left over is very important when buying your house. For instance, lawn tools, etc.
You pay it and what? You don't see anything build in return, right?
My mother's first place was a large home. My father converted the attic to an apartment, legally. The rent on the upstairs flat paid for my parent's mortgage. Smart basic move. This allowed them to build up and enjoy an extra income source without the extra sweat. When my Mom moved in, she had one kid. She ended up with six. The tenant was a blessing and also a cost that could be adjusted with unexpected increases like when economy costs rose. We moved to Long Island for need of a larger place--cause we as a family grew--and better educational options. Owning your own home is more than the cost of a mortgage, it's an investment, especially on Long Island, that can really help your future broaden.
Don't despair! Paying on a mortgage is sure wiser than tossing your money away on rent. Paying on a mortgage is you, land owner, investing in the future. And homes on Long Island are at great prices. BUT, land here never stays low priced for very long. While you are calculating and waiting, also consider...When home sale prices do start to rise, it is not by tenderly small increments. Good luck to you. Wish my mother and I the same.
In terms of trends, prices here are still correcting. For example, the median selling price of a Long Island home dropped to $409k from $445k a year earlier--and some industry experts expect a further fall off. However, local markets do not act in unison; while some are down and will dip further, others are actually up.
Q: Are you using a buyer's agent to guide you? If not, why not?
If you check my profile, it will shed light upon my mission. Get in touch with me, if you care to.