Mortgage Rate News

Yesterday, I shared some tips on what to consider when buying a home. Today, I’d like to share a few more. These tips come from a guest post by Mike on Get Rich Slowly. First, though, a recap of the tips from Part 1 (tips 1-5):

1. Choose a good location.
2. Consider your budget.
3. Know the market.
4. Don’t believe everything your real estate agent says.
5. Don’t try to “time the market.”
6. Don’t worry too much about the down payment. A down payment is nice, but it is much more important to be able to afford the mortgage payments. If you can put up enough to get an FHA loan, or if you can get a down payment that will lower your interest rate, go for it. But don’t wait until you have 20% to buy a house.
7. You don’t need to remodel now. Or buy new furniture immediately. We still have the same couches we had years ago in our new house. They don’t exactly match the house, but after buying a home, there isn’t exactly the budget to completely redecorate. The same is true of remodeling. Unless you bought a total fixer upper, you can take the remodels slowly, as you have the money for the improvements.
8. Are you buying a flip property? Watch out for sellers who make cosmetic upgrades to homes, while leaving things like plumbing and electricity substandard. These are often flip properties — bought on the cheap due to problems and made to look as though they are nice so that they can be sold quickly for profit. Instead, have a thorough home inspection. One that includes electrical. Avoid buying something that is substandard.

Another points I like from the article is this one:

If the house is livable and you have a good life, then you will be happy with whatever home you end up buying. If you spend more money on a “better” house, then you will quickly get used to it and will be no happier than if you had bought an “average” house.

There is no need to get a larger mortgage for an upgraded house if a modest home fits your needs. Ultimately, the thought that we “deserve” more is what led to the current subprime mortgage mess. And if you are always looking for something “perfect,” you will miss out on the everyday pleasures that life can bring.

Tags: buying a home, tips buying home, home mortgage loan, mortgage loan blog,
flip property, subprime mortgage, mortgage lenders

Last September, I closed on my first home. As a first time home buyer, there were lots of things that I learned on the fly. And, happily, several things I already knew. Over at Get Rich Slowly, there are some tips that can help first (or any other) time home buyers choose the right home for them:

1. Location. You’ve heard the saying, “Location, location, location!” Well, it’s true. You should consider location. My husband and I wanted to buy a home that was located close enough to public transportation, yet not in a busy part of town. We also wanted easy access to town. We managed to fulfill those requirements. And with the price of gas, we are glad we did. You should also consider the neighborhood. Will the resale value be there? Is it a place you want to raise your kids?
2. Budget. Take a look at your budget. Can you afford the mortgage payments? There are mortgage calculators that can help you get a ballpark figure on monthly mortgage payments. Don’t try to make the mortgage “fit” into your budget. If you can’t afford the mortgage payments, move on. And don’t be house poor. If the mortgage payments will mean you can’t do other things you’d like, reconsider.
3. Know the market. Will you be able to negotiate on price? Does the price seem a little high? Look at different home prices, and check public records to see how much homes are selling for in the area.
4. Don’t trust your real estate agent. We had a great agent. But we did a great deal of the homework ourselves. The fact that the agent is getting commission immediately means there is a conflict of interest. An agent can be helpful, but don’t believe everything he or she says.
5. Avoid trying to “time the market.” Don’t make a decision too fast or too slow. If you find a house you like, that you can afford, don’t wait for things to fall just a bit further. If you can’t find something that fits your needs, don’t rush into something because you’re afraid you’ll miss out on a great deal. Your decision should be made when you find something that works for you.

There are more tips, but we will cover them tomorrow.Tags: mortgage payments, buying a home, home mortgage loan, mortgage loan blog,first time home buyers, house poor

When looking to buy a home, it is important to get a bargain, if possible. And in the house buying game, part of the process is looking for a home that might be ready for a lowball bid. Money Talks offered these five things, taken from a Newsweek article, that may indicate that you could benefit from offering a lower home bid:

1. Seller getting ready to move. (Or may have even already moved.)
2. After 90 days being listed, there has been no price change on the home.
3. Equity is available on the property; it’s not at risk of being upside down.
4. In a new development, the home is the last one.
5. The home sale is part of an estate sale or a divorce proceeding.

Another consideration could be a home in foreclosure, or a home in danger of entering foreclosure proceedings. You might be able to benefit from a short sale in such cases. Or, in the case of a foreclosure, you might be able to get the home for much less as the bank tries to move it.

In any case, a home seller that could be ready for a lowball bid can be a great way for you to test the waters and see if you can get a real estate bargain. You might find that the seller is willing to deal in non-cash extras as well. You could end up with a carpet and/or paint allowance. Or maybe the seller will pay for the home inspection or some other type of inspection. Perhaps you can get partial landscaping (if it’s a new home) or some other benefit tossed in.

This is the kind of market that you look around in. If you are in a good position, you don’t need to rush things. Be careful about what you buy, and take the time to ensure that you are getting a truly good real estate bargain.

Tags: home sale, home lowball bid, home mortgage loan, mortgage loan blog,
real estate bargain, buying a home, short sale