Posts Tagged ‘first time home buyers’

Pending Home Sales Soar In February – Buyers Are Everywhere.

Tuesday, April 6th, 2010

Pending Home Sales (August 2008-Fed 2010)As expected, the Pending Home Sales shot higher in February, boosted by the federal home buyer tax credit’s April 30 deadline.

Versus the month prior, February’s index rose 8 percent but remains well off the highs set last October.

For today’s home buyers and seller, the Pending Home Sales Index is an important measurement. This is because a “pending home” is a property that is under contract to sell, but not yet closed.

According to the National Association of Realtors®, 80% of homes under contract close within 60 days, historically. Therefore, a higher Pending Sales figure in February projects that April’s Existing Home Sales will be higher, too.

If you’re a Texas home buyer today, no doubt you’ve noticed the extra market activity.

On right-priced homes, multiple offer situations are more common; sales prices are settling closer to listing price; Days on market is falling. These are the signs of a buyer-heavy market.  It drives home supplies down and home prices up.

It’s a good time to be a seller, in other words.  Especially as buyer activity looks poised to peak.

When the home buyer credit faced its last expiration in November 2009, we saw a pattern of buyers rushing to beat the deadline.  There’s no reason to expect that won’t happen again. And as it does, Pending Home Sales should continue to climb. Average home sale prices should rise.

Home buyers may find it smart to go under contract sooner rather than later and Pending Home Sales is a warning shot.  Higher home sales figures are ahead.

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Texas VA Loans – The Best Kept Secret

Thursday, March 4th, 2010

If you are a Veteran and looking into purchasing a home in Texas, then a VA loan is perfect for you.

Because VA Home Loans are guaranteed by the Veterans Administration, they are easier to qualify for, require no down payment (yes 100% financing is still here), and most importantly don’t require perfect credit.

VA Purchase Loans
I specialize in servicing first time home buyers utilize their VA benefits each and every day. A VA mortgage offers many advantages, as it is very popular with first time homeowners. Because a VA Loan is guaranteed by the Veterans Administration, you should expect lower interest rates and less down payment in relation to a conventional residential home loan.

VA Refinance Loans
The Veterans Administration offers Texas Veterans several different VA Home Loan Refinance Programs. I understand and appreciate those Veterans that have served our great nation, and am here to provide you with a variety of options in order to accomplish your VA refinance goals. If you are considering  refinancing of your current loan to lower your interest rate, or restructuring your payment and equity objectives, I can present you the most viable and beneficial options in the marketplace.

Exciting things are happening with VA home financing – VA is only 1 of only a few options left for true 100% financing and it’s important to stay up-to-date with changes in loan limit increases, and VA Mortgage news, so feel free to subscribe to my blog or follow me on Twitter at @RightMtgGuy.

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Should You Use Your $8,000 Tax Credit as Your Down Payment?

Saturday, May 16th, 2009

So there has been a lot of rumors regarding the $8000 first time home buyer tax credit and that it can be used as a down payment for a new home with an FHA loan.

At first, I thought it was just another “mortgage scam”. Trust you me, the real mortgage industry always leaves room for the next “million-dollar-idea”. If you pay close attention, you may even end up seeing your next door neighbor on the 6 o’clock news getting caught for selling “ARMS” from the back of his van in a dark alley.

After doing a little bit of research to see the legitimacy of this rumor, I ended up finding the official HUD Mortgagee Letter 2009-15.

Who Can Offer It

Let’s begin with who can offer this “loan” on a loan. (Is that a conundrum?)

According the letter, Federal, state, local governmental agencies, non-profit governmental subsidiaries, and FHA-Approved nonprofits will be able to offer this to home buyers.

How It Works?

Essentially, this is a bridge loan. You are borrowing this money for a short amount of time until you get your tax credit, and then it is paid back to these agencies.

What happens is you are taking out a second lien on your home, and that amount CANNOT be more than:

Down Payment + Closing Costs + Pre-Paid Expenses

Here is a list of some more facts on how this works:

1.) You cannot get any cash back at closing.
2.) You will have a deadline to pay this money back, and if you do not, principal and interest will begin automatically. (What a concept!)
3.) If payments are required, it will be calculated as a monthly liability when qualifying for the loan.
4.) If payments are deferred, it must be for at least 36 months and will not be used against you when qualifying.

I cannot stress to you enough -BE VERY CAUTIOUS with this type of transaction. It leaves so much room for deception, and if you end up in the wrong hands, you may kiss your $8k tax credit goodbye very fast!

While it may bring an influx of new potential buyers to Realtors and open a lot of doors to potential buyers, it is a double-edged sword and I do not particularly agree with it. In my opinion, it can do more bad than good and is basically bringing back “100% financing” and that is part of what has caused the “Mortgage Meltdown”.

I would suggest stopping and thinking as to why many down-payment assistance programs went bye-bye towards the end of 2008. It was simply because more buyers defaulted on those types of loans. The LAST THING we need is the Federal Housing Administration (FHA) getting into financial issues.

Tommy’s 2 Cents:

Use it IF you absolutely HAVE to. The $8,000 is yours one way or another.

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Posted in FHA Mortgage News | No Comments »