Please call me at your conveinience to discuss your goals. I already have some properties in mind that will fit your criteria. But I need to know more to give you specific details...such as your preferences for neighborhoods, size (squarefootage), parking, etc...Benjamin
Buying your first home can be a big step and you are doing the right thing to determine how much you can afford. There are several programs available for first time home buyers that can either help with down payment, and sometimes offer a below market interest rate.
Finding a local mortgage person who understands the different programs offered in California and in the individual cities will allow you to take advantage of these programs.
I can highly recommend Chris Hudson of My Home Loan Plan. He is very knowledgeable regarding the different programs available to first time home buyers. He is honest and a consummate professional who works with his clients best interests at heart.
You can check out his website at http://www.MyHomeLoanPlan.com or he can be reached by phone at 925-429-5226 or via email at Chris@myhomeloanplan.com.
If you have any questions regarding the process for buying a home as a first time home buyer, please do not hesitate to contact me. I live and work in Oakland and am familiar with the area and neighborhoods.
Alain Pinel Realtors
I ran some quick numbers based on your loan scenario posted above. It looks like if you stay below $250,000 your monthly payment will be right around $2000.00 per month, out the door.
Feel free to email me with any additional questions. firstname.lastname@example.org
Besides the price of the home and your downpayment, your monthly payments will also depend on the program(s) you choose, what your credit score is like.
If you prefer to stay in Oakland, have you also checked with the City regarding home buying assistance, especially for First Time Buyers? You may qualify for their program. Here's a link to its Home Buyer Loans and Grants http://www.oaklandnet.com/government/hcd/loansgrants/homebuy It's a lot of work to go through the process, but the end result is so rewarding.
And....where are thinking of buying a home? We looked at homes in Oakland, but decided that there are better deals in San Leandro. For example. just today, I showed her a house in San Leandro that is currently listed at $280K, and is a short sale. That property sold for $525K in 2007, and is assessed at $429K. So if you look closely, you should be able to find good values.
The lender that provided you with your pre-approval, should be the best source to answer this question. They should know the tax rate for the areas you're considering, and the typical hazard insurance costs. They are also going to have the current rates for Private Mortgage Insurance, which in one form or another, is going to be required if you put less than 20% down and only have 1 mortgage.
If your lender doesn't have the info, then as Dan indicated, you need to get a good buyer's agent to help you through this.
Here's just an example. Presuming your cost of hazard insurance for the home was $600/year, and the tax rate was running about .8%, and the loan had a monthly PMI premium of $200 (yes, it could really be this much!), then you could afford a home with a final purchase price of approximately $260,000.
Note, probably all of your $5K downpayment is going to get eaten up in fees, so consider asking the seller to cover some or all of your closing costs. And ask your lender if they actually have federally backed mortgages with less than 3% down payment, they've nearly all dried up these days. 3% of $260,000 is $7,800.
The above is just an estimate, so don't rely on it for a final decision. And remember, never borrow what someone tells you you're approved for. That's how many people get into so much trouble in the first place. Establish your budget and stick to it. Then ask friends, coworkers, neighbors and people you trust for a recommendation for a good buyer's agent.
Consult with a real estate agent. You can find good ones for the buying a home at seekingagents.com -- you can even get a discount on your home purchase via a buy-side comission rebate. This can be a huge help when you don't have a lot to put down.