There is often quite a difference between appraisal and assessment.
Vision Appraisal actually helps towns with their assessments, so the
number they use may be up to 10 years old, and/or just plain wrong.
Some towns have new assessments regularly, but the state of NH only requires them
to be updated every 10 years.
For a Realtor they are important because we can compute taxes from the assessments, and
also check our "comps" against the reported sales in the market area.
For a buyer--like yourself--they will give you bad (unreliable) data. And when you make your decision on bad data, you stand a pretty good chance of making an error. Here's another opportunity to use a solid Buyer Agent to help with your decision.
With your credit scores, I'd consider a conventional (non FHA) mortgage where there is lender-paid MI. I could work with you to figure out if that is the cheapest and best option.
FHA loans are not credit based, so you'd be wasting your excellent credit score.
FHA still has MI, but you get to finance half of it (roll the cost into your loan amount), and then you still will have a monthly MI payment as well.
If you can do 10% DP and go conventional, that might be best.
I do not think you will avoid PMI if you cannot drop the 20% down...though with good credit scores like yours that would be a conversation to have with your lender of choice- the bite they take for PMI MIGHT not be as big. I have several lenders to recommend if you want recommendations.
The reason NH Finance and FHA is good these days is that they let you borrow up to 97% as I understand it, which approaches the old days of piggyback loans on a first at 80% and a second home equity loan at 20% BOTH signed at closing. Yoiu still have to cough up 3%. Again, I am not the financial man, I am not a lender, but I am pretty sure I have this straight. Also, the FHA guidelines have been severely loosened so the property does not have to pass muster on as many fronts as it used to.
My point is as you STILL therefore have the ability to borrow a lot with an FHA loan and hold onto your cash since you are financing a good proportion of your purchase, it is in my opinion a good time to buy, let the appreciation ride up over the next 5-10 years and either sell then or when more toward the a new market top, or if you intend to live in the house you will have at least had a chance to let your $40,000 build up over time provided you have made some safe investment decisions in a well diversified portfolio. The gap in home prices typically fills in quickly once there is recognition that the bottom has been reached. That recognition appears to be happening now at its beginning stages. You will have something of value IF YOU CHOOSE THE RIGHT PROPERTY, let it appreciate, then either sell it or pay down you mortgage with a lump sum payment (make sure there is no penalty for prepayment on your loan). The interest rates you catch now will likely be lower than if you wait to buy. My advice is to stay with a fixed loan. As oil becomes more expensive, companies will be forced to raise costs which will in turn mean that inflation will present as an issue and that borrowing money will become a riskier proposition and interest rates will go up. Again, check all this with you financial advisor or talk it through with a lender.
Thank you for your awnsers. My wife and I have been pre approved and both hold credit scores over 740 but unfortunatly do not have 40k to put on a 200k house or we would deplete our savings. Why are the FHA loans better than having PMI, or are they?
Yes, do not relie on the town's assessment (which is what Vision is) for purposes of market value. That is a big mistake as they serve different purposes. Market value is reflected by what has sold or is pending, but also in this market particularly (and rarely) by what is currently on the market. That is, if you are a seller and need to get your home sold, you don't price at strictly what has sold in the last six months as in the old glory days of 2003-2005, rather you look also at what is current on the market and price better than what is out there. If you are a seller this is not the best time to sell, but if you have to sell you have to sell. Alternatively if you area buyer, a good agent can also track price drops for you, narrow in on the best properties on a price and on a "what you are looking for" basis, and get right to it and find you a great deal. Of course being creditworthy is even more important as the lenders are really scrutinizing buyers' ability to repay their loans. NH financing and FHA financing are typically your best borrowing options these days if you do not have 20% to put down to avoid private mortgage insurance (PMI).
Buddy Pope (603) 562-5186
THE MASIELLO GROUP
101 Ponemah Rd., Amherst NH 03031
If you want current market value data, you need access to the MLS database. Since you have to be a REALTOR member of the MLS to access the data for a CMA, your best option is to make a buyer's representation agreement with a REALTOR member of the MLS. It will likely cost nothing, while getting the tools, expertise and skills of a professional on your side of the negotiating table.