Home Buying in Brooklyn>Question Details

Firsttimebuy…, Home Buyer in Brooklyn, NY

Interested in buying a first time home. I make 70k a year and have ok credit

Asked by Firsttimebuyer, Brooklyn, NY Tue Feb 5, 2013

I'm looking to buy either in Brooklyn or Queens for 250-300k, fha and saved 20k so far. Is it realistic to start looking for a house now or should I wait a few months. Can anyone give example of what past client have payed in terms of downpayment, closing, monthly amount, and any other fees.

Also I'm looking for a website that have personal stories of home buying with info like the down payment amount, monthly mortgage rate, and other fee. I done research online and every site give different amount.

Help the community by answering this question:


Dear Firsttimebuyer:


In my experience I have found that if you purchase a home with an FHA mortgage for $300,000.00 you would be required to put down at least 3.5%. hence your down payment will be $10,500.00. You will also have closing costs that will be approximately 6% of the loan amount, in this example that would be about $17,000.00. Given that and the fact that you have $20,000.00 to work with, you will be short about $7,000.00 which you can finance by adding what you call a seller's concession into the contract of sale. This means that you would actually be borrowing about $297,000.00.

Right now the current prevailing rate on a 30 year fixed mortgage is approximately 3.5%. This means you would have a monthly mortgage payment of about $1335.00. You will also have to pay homeowner's insurance and real estate taxes which in Brooklyn would most likely be about $400.00 per month. Also, with an FHA loan you will have to pay a mortgage insurance premium which will cost you about $310.00 per month in this example. When you add that all up you will be paying a total monthly living expense (PITI) of $2045.00.

Now, with a monthly PITI of $2045.00, most banks will want the purchaser (you) to have an income of at least $60,000.00. This is assuming you have no other debt. If you have additional debt like car payments, student loans or credit card debt etc, than the banks will not want you to be spending more than 45% of your income on your living expense and total other debt. As an example, if you have a car lease payment of $500, a student loan payment of $300 per month and $200.00 per month of credit card debt, your monthly PITI plus other debt would become $3045.00. In this example you would need to have an income of at least $81,000.00.

The long and short of it is that you need to pre-qualify yourself with a good mortgage banker and find out exactly what you are qualified to do. Then you can shop for a home with confidence. If I can be of further assistance, please let me know. Good luck!!

Mitchell S. Feldman
Associate Broker/ Director of Sales
Madison Estates & Properties, Inc.
Office: (718) 645-1665/ Cell: (917) 805-0783
Email: MitchellSFeldman@aol.com
2 votes Thank Flag Link Mon Feb 11, 2013

I respectfully disagree with your assertion.

1. Millions of Homeowners own their homes today thanks to the FHA program with the minimum down payment. And those Homeowners are surviving and thriving in their homes, making their mortgage payments every month, and improving their financial health thanks to the opportunity provided through the FHA program to become a Homeowner. In other words, the sky isn't falling.

2. I learned early on in my career as a mortgage professional, back in 1989, that closing costs in the New York City area are so high that it's truly difficult for the average person/family to save substantially enough for a large down payment PLUS the closing costs. On a $300,000 Purchase, if a person were to follow your advice and aspire to save a "substantial" sum, say, 20% PLUS the closing costs PLUS reserves, that person would need to save approximately $80,000. Have you considered what it takes to save that much money?

3. Cost of living in the New York area is so high that, unless you're living rent-free at your parents' home, spending almost ZERO on commuting, gas, car insurance, food, laundry, you'd have to scrimp on an extremely tight budget to save $80,000 in a reasonable period of time, let's say 5 years.

4. I always have found it best in the industry we work in that real estate agents focus on selling real estate and leave the financing aspects to the mortgage professionals. While I applaud your conservative concern for this consumer, the fact is your proposal basically blocks many potential homebuyers from taking the steps necessary to become homeowners, even though the financing is available in this conservative lending environment of 2012-2013.

5. Licensed Loan Originators like myself are trained and required to include financial counselling as part of our interviews with prospective Borrowers. There are many, many, MANY Loan Originators like myself who take care to provide clear information and conservative counselling so a Borrower doesn't get into a situation fraught with potential financial disaster.

All the best!

Trevor Curran
NMLS #40140
Mobile: 516-582-9181
Office: 516-829-2900
Fax: 516-829-2944
PowerHouse Solutions, Inc.
185 Great Neck Rd, Suite 240
Great Neck NY 11021
Licensed Mortgage Banker – NYS Dept. of Financial Services
1 vote Thank Flag Link Thu Feb 7, 2013
And you'll continue to see different stories. What you should do is meet face-to-face with a Loan Officer and allow him/her to review your credit, income and assets documentation. This is the only way you'll know for sure what YOIR situation will be. One buyer's story can be different from another. A website can't tell you what loan program best fits you now, or what your options are if you save more money for down payment, etc.

If you need a Loan Officer, I'm always available to meet in our Brooklyn or Queens offices. Good luck!

Javier Meneses
NMLS #23130
Senior Loan Officer
Sterling National Bank
(516) 606-9648
1 vote Thank Flag Link Wed Feb 6, 2013

I would be concerned about someone with a total of $20K in savings buying a home in the price range you are looking at. Even by making the minimum downpayment for an FHA loan, after closing costs you will not have much savings left going forward. If you incur a financial problem such as losing your job or a medical emergency shortly after closing, you will not be able to handle the consequences. I would recommend that you wait until your savings grow substantially.

Michael Richman
Licensed Real Estate Associate Broker
KIAN Realty
450 7th Avenue Suite 1501
New York, NY 10123
212-757-8268 x220
0 votes Thank Flag Link Thu Feb 7, 2013
I have sold my share of listing in the Queens,Brooklyn and Long Island
in the New York area. But the calls are coming in and the requests are so
many that I need to show more of them. I would love to have work with you
and any referrals we can add my inventory for sale. Please send fee and we
will work on them together. I just need a few seconds to sit with you and discuses.
Please just give me a call as soon as you can.

Fajardo Delacruz
Licensed Real Estate Agent
Century Homes Realty Group llc
Direct Line: 347-932-0609
0 votes Thank Flag Link Wed Feb 6, 2013
Be aware that a mortgage pre-approval letter is required in order to determine your price range and for any offers to be taken seriously, therefore begin by visiting with any licensed loan officer; the downpayment amount will depend on the type of loan. Also choose an agent to work with, he/she will be your best guide....
0 votes Thank Flag Link Wed Feb 6, 2013
Hi Firstimebuyer,

I agree with my colleague Trevor Curran that you should assemble your own team of real estate professionals starting with your loan officer. But don't wait a few months, if you are truly ready today
Now is the perfect time to buy while interest rates are at historic lows and homes remain aggressively priced especially since current trends suggest that rates and prices will continue to rise throughout the year. You described yourself as having "OK" credit and 20k down and expressed an interest in FHA financing. Depending on your actual score and financial profile, a conventional loan may be a better option for you than FHA. As a licensed loan officer wth extensive experience working with first time buyers, I have recently secured conventional mortgages for clients with only 5% down and mortgage insurance rates that are 50% less than what FHA requires. I recently posted an article on my Trulia blog about increases in the mortgage insurance rate for FHA loans and other changes scheduled to take effect April 1 that will make FHA loans even more expensive compared to conventional loans and may make it harder for some borrowers to qualify. You can read the full article and recommendations from many first time buyers who had concerns and questions similar to yours by viewing my Trulia profile.

I invite your questions and comments and can be reached direclty at 917.699.0183, michaeldenniston247@gmail.com or follow me on twitter @mdenniston247.

Michael Denniston
Senior Loan Officer
NMLS License 24076
Cliffco Mortgage Bankers
New York, NMLS ID 860126
0 votes Thank Flag Link Wed Feb 6, 2013
Good morning Firsttimebuyer,

The reason you're encountering different amounts is because everyone's situation, and every house, are different. There are many different factors that affect the terms of a mortgage loan including (but not limited to): credit score, loan program, amount of mortgage insurance (if required), size of downpayment, fees charged by different Lenders, and etc.

The same is true of homes. Given two homes side by side on any street in Brooklyn or Queens and the price required by the Homeowner to sell that home can be widely different, including what a Buyer might be wiling to pay. Looking at the two homes they may appear identical, yet a Buyer might be willing to pay more for one over the other; and the Seller may require more for the remaining house in order to accept an Offer to Purchase from a Buyer. And there are the property taxes, which, in our example, can be very, very different for these two imaginary properties, also.

Your best bet for clear direction and understanding is to follow my Primer for Home Buyers based on my 23 years experience as a Mortgage Banker:

First steps:

1. Meet with a Local Mortgage Banker to get prequalified for mortgage financing. The Mortgage Banker will review all facets of your loan request to answer your questions with regards to the types of loans and maximum loan amounts you could qualify for. Your Mortgage Banker will be able to answer questions for you as you shop for your home, specifically with regards to monthly payments and closing costs.

2. Get a referral to a good, local, real estate attorney. Call the attorney, retain the attorney so you have her information handy when you make an offer. Having that information at time of offer helps you demonstrate to the Seller how serious you are, and they will consider your offer with more interest.

3. Line up a Home Inspector. A good home inspector will scare the heck out of you: that's what you pay him for! But you'll concentrate on the fundamentals of the property: roof free of leaks, plumbing, heating and electrical up to code and in good working order. Again, when you make an offer and you have your Home Inspector ready to go, your offer will be considered with much more interest by a Seller because you truly have your "ducks in a row" and your preparation demonstrates your serious attitude about conducting the purchase transaction in a timely manner.

4. Find an experienced Local Realtor who works in your desired shopping area. A serious pro Realtor will refuse to show you homes until you are Prequalified for mortgage financing. Don't take offense! That Realtor doesn't want you to be disappointed and wants you to have a smooth experience as you shop for your new home.

Put together your Team of real estate professionals and shop 'til you drop!

Trevor Curran
NMLS #40140
Mobile: 516-582-9181
Office: 516-829-2900
Fax: 516-829-2944
PowerHouse Solutions, Inc.
185 Great Neck Rd, Suite 240
Great Neck NY 11021
Licensed Mortgage Banker – NYS Dept. of Financial Services

If you thought my answer was helpful, please give me a "Thumbs Up." Thanks!
0 votes Thank Flag Link Wed Feb 6, 2013
You can purchase a home with an FHA loan with 3.5% down, however this is not going to give you the best mortgage rate. In order to get the best rates and avoid PMI which could easily add $150 - 200 a month to your mortgage payment for roughly the first 5 years or so, you will typically need at 20% down to get a conventional loan. Your best bet is to talk with some different lenders and see what your specific options are. I would advise against speaking with any of the big banks (Wells Fargo, BoA, Chase etc) and look for either smaller local banks, a credit union if this option is available to you, or mortgage brokers who have access to multiple sources for lending.

You're going to want to find an experienced buyer broker to work with, and need to be prepared to interview several as while most will talk a decent talk, most really aren't that experienced and don't really know what their doing. I've attached a link below on how to find a great broker to work with regardless of where you live and hope it proves helpful.

Best of luck to you.
0 votes Thank Flag Link Wed Feb 6, 2013
The link is no longer available, could you please re-post?
Flag Sat Oct 19, 2013
Hi First Time Home Buyer,

Call me as soon as possible or shoot me your email telling me which areas of Brooklyn and queens you where thinking of settling in. I will send you available properties in that price range. Getting into those properties is a different story as most licensed real estate sales people require a preapproval from a mortgage company. I specialize in first time home buyers and investment properties and have assisted 3 people this year get mortgages. Depending on your family size I also asssited in getting 2 of them their closing cost paid by grant. I would say based on your information you are ready (smile). Call me and we can further discuss your options.

Ramona Johnson, Licensed Realtor® Coldwell Banker Mid Plaza Real Estate Office
Mobile (347)488-2606
0 votes Thank Flag Link Wed Feb 6, 2013
Hi I work with Rapid Realty and we have just expanded our market from just rentals to sales. I recently purchased a house in Brooklyn so i am very familiar with the process and i'm a licensed agent. 20k is a perfect start with your price range all you need to do is find the right house. Interest rates are very low so it's a great time to buy. Please feel free to call me or email as I have many contacts that have properties listed. Tiffanytiffany2008@yahoo.com 860-847-0733.
0 votes Thank Flag Link Tue Feb 5, 2013
0 votes Thank Flag Link Tue Feb 5, 2013
http://www.eracaputo.com/homepage.htm..here's my office website..there are many links that should be helpful to you...including a mortgage info link..hope this helps. all the best to you, and if I can be of any assistance to you, feel free to contact me.
0 votes Thank Flag Link Tue Feb 5, 2013
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