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| Home Loans Help / First Time Home Buyer Program |
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First Time Home Buyer Program - Information and Advice"Get the most house with a first time home buyer program."Buying your first home? Some of the questions you may be asking are:
Rest assured, you are not alone. According to the 2004 National Association of REALTORS® Profile of Home Buyers and Sellers, first-time homebuyers accounted for 40 percent of the homes purchased in 2003. The home buying process can be overwhelming, but if you go into it prepared, your first purchase can be a good experience if you participate in a first time home buyer program. Here are some things for first time home buyers to consider before making the plunge:
Fear of being rejected for a home loan is one of the main concerns for first time homebuyers. To lessen the stress, you may want to get pre-approved for a loan before looking at prospective homes. This will not only help you feel more confident, it will also give you an advantage when there are multiple offers for a specific home. The fact that your loan has already been approved is of great value to the seller because it shortens the purchase process and there is less of a chance that the buyer will back out of the sale. E-Loan is a great site where first time home buyers can get pre-approved in under five minutes. They also offer first time buyers a combination loan program that can provide your down payment. The combination loan can cover up to 100% of the purchase price. Click here for E-Loan's special First Time Home Buyer Program.
The costs involved in the purchase of a home can be overwhelming to first time home buyers. However, with the help of a first time home buyer program like E-Loan's, you can now afford more home value for the same amount in mortgage payments. An adjustable rate mortgage is another safe approach for first time home buyers because you can afford a better house than you could with a traditional 30-year mortgage. And while you may live there only a few years, the higher-priced home will increase in value by a far greater amount than the lower-priced home. Keep your mortgage payments as low as possible and build equity through appreciation, not through a hefty mortgage payment. Take advantage of the first time home buyer program of combination loans. Your payment will be the same as an 80% mortgage with PMI or private mortgage insurance. The main advantage is that the E-Loan program also provides most or all of your down payment.
The down payment amount varies depending on the value of the home you choose and your mortgage lender. And in some cases, first-time home buyers can purchase a home with no money down as in the E-Loan program. Although it varies from state to state, some states offer government-funded programs for first-time buyers that help people buy a home with no down-payment. However, by not using the combination loan program to eliminate the PMI and keep your payment the same as if you were paying off an 80/20 mortgage, you end up paying far more each month with a government grant arrangement. Your mortgage broker or real estate agent will be able to explain the
different options available to you as a first time home buyer, but your goal
should be buying the most house for the smallest monthly payment. Closing Costs First-time buyers often forget to consider the closing costs when making an offer on a home. Paying closing fees of up to five percent of the home sale amount is not unusual. Add that to the down-payment and you’ll have quite a sum to raise before the final papers can be signed. However, a smart first time home buyer takes this into account before making an offer, and with some professional help, the costs can be estimated in advance. And again, use the combination loan approach to maximize your available funds.
Don’t feel pressured into making an offer on the first home you see. This is a common mistake of many first time homebuyers. Make sure you view different homes to get a feel for the marketplace. When you do decide on a home to make a bid on, work with your real estate professional to get all of your questions answered first before making an offer. But don’t wait too long to make an offer. The longer you wait, the greater the chance other prospective buyers may
place offers, making it harder for you to negotiate a good deal. Condition of the Home Buying a “problem” home is another fear of first-timers. A home that needs major repairs can become a costly venture. And, unless the asking price is adjusted to reflect the hidden repairs needed, chances are the home is not worth as much as the seller is asking for it. To avoid unfortunate surprises, your real estate agent should advise you to hire a home inspector before making a serious offer. That way, you know what you are getting into and there are no surprises.
Above all, remember that there are no silly questions. Make sure you understand and are comfortable with every aspect of the transaction. Your real estate professional can be an invaluable asset in helping you make educated decisions so that your first-home purchase is a rewarding experience.
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