First-time Buyers Make Up Record Share of Buyers: NAR
First-time homebuyers accounted for half of all home sales from July 2009 through June 2010, according to a National Association of Realtors survey of buyers and sellers. My personal experience mimics this with several buyers this year for homes in Prescott and Prescott Valley.
That's the highest share of first-time-buyer purchases in the history of the survey, which dates back to 1981. First-time buyers responding to the survey made up 47 percent of sales in 2009.
The 2010 NAR Profile of Home Buyers and Sellers, based on 8,449 responses to a survey sent to homebuyers and sellers nationwide whose transactions took place between July 2009 and June 2010, according to county records.
The vast majority of first-timers (93 percent) participating in the survey, and almost three-quarters of all buyers (71 percent) responding to the survey participated in a federal homebuyer tax credit program.
I expect this trend to continue as rents are often above comparable mortgage payments, especially in Prescott Valley, but deals can be found in Prescott as well.
New Fannie Mae loan program benefits investors
Fannie Mae, the Federal National Mortgage Association, has announced a new program for buyers purchasing Fannie Real Estate Owned Properties (REOs).
The motivation behind this program is for Fannie Mae to quickly sell off foreclosed properties. If the parameters fit,this could be a bargain for a motivated buyer. If you will occupy the property, you can put as little as 3% down and an appraisal is not required - the selling price will determine the value of the property. A gift can be used for the down payment/closing costs and no mortgage insurance is required but you must have a 660 credit score.
If you are going to occupy the property, you are eligible for a light renovation loan which can be added to the loan amount. The renovations must be approved and completed within 90 days of funding the loan.
This product is also available for buyers purchasing a second home but requires 10% down and buyers purchasing an investment property may also put as little as 10% down. The minimum credit score has been lowered for these programs but buyers will still be evaluated on a case by case basis.
This program is available to buyers of condos and properties up to 4 units. For those putting 25% down, you may own up to 10 properties.
For more information about the current financing market or to get pre-approved, call
Tom 928-775-9330 or email him at tomhenichek@cableone.net.
How do you get the most out of your Prescott home purchase?
From Tom Henichek, a local loan officer at Mountain Mortgage
Get a better interest rate
Well, for starters we have lower prices than anytime in the recent past, great interest rates and the possibility of seller concessions. Every product today has at least a guarantee of 3% seller concessions. So, if the seller will or cannot lower their selling price, they may allow some concessions in order to sell their home.
This is only one of the reasons why if you are thinking of purchasing a home, you should talk over your situation with a lender. In today's cash poor society, your lender can assist in this process.
After all, if you need assistance with your closing costs, your lender will be the first to advocate for you. The best way to document this is to come up with a figure for the seller's contributions. The 3% is based on the loan amount and if the contract states that the amount is for closing costs, some lenders may not allow the contribution for prepaid items i.e. interest, home insurance and property taxes. With a specific amount stated and contributed, that money can be put toward prepaid items or be used to buy down your interest rate.
Today, the spread between interest rates is lower than at any time in the past and this option may be worth considering.
The credit system is ripe for errors and something from your past may still be lurking on your report even though you thought it was corrected. With the number of foreclosures, credit reports are weighed heavier than at any time in our history. Being pre-approved for a purchase will cost you nothing but time and will put your mind at ease when the time arrives for you to make your move.
For more information about the current financing market or to get pre-approved, call
Tom 928-775-9330 or email him at tomhenichek@cableone.net.
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