Hector Milla asked:

The Obama Housing Stimulus Plan is surrounded by a lot of misinformation and misunderstanding. Do you know what it takes to qualify for the first time home buyer’s credit? What about loan modifications? This article will give you a great basic understanding of the new Housing Stimulus Plan and how it can help you –and thousands of other Americans– save their home from foreclosure.

One of the first things the new stimulus plan does is give first time home buyers a new tax credit of $8,000. This money is only available to individuals that have not owned a home for the last three years and only applies to homes purchased this year, in 2009. Homes purchased last year qualify for a different stimulus plan tax credit of $7,500 that must be repaid. This new tax credit is reduced is the buyer’s income is over $75,000 (if single) and $150,000 (if married). You can choose to have the tax credit paid to you through your 2009 taxes or an amendment to your 2008 tax return.

The plan also gives people with problem mortgages the chance to refinance for a new low, fixed rate. If your home mortgage is above 31% of your income, you have a loan through a government-approved lender and can prove that you can financially handle your new, lower payments, you may qualify for a refinancing. This can can help you in a number of areas, including giving you a lower monthly payment, converting an adjustable rate to a fixed rate, possible forgiveness of some principle, waived late fees and forgiven missed payments.

This new housing stimulus plan has the potential to help millions of Americans that are struggling to afford a new home, or keep the one they already have. If you’re preparing to buy a new home or are in desperate need of a refinancing on your existing home loan, consult with someone that specializes in home loans and the new stimulus plan to find out if you qualify for this government financing.

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Brandon Cornett asked:

For most people, buying a home represents the largest and most significant investment they will ever make. So it only makes sense to prepare for that process.

Here are seven things you can do to prepare for the home buying process, before you even begin shopping for a home.

1. Learn the home buying steps in advance.

When you understand the basic steps to buying a home, you will make better decisions along the way. This will help ensure a smoother real estate transaction. Mortgage and home buying lingo is a big part of this, so be sure to read through a few real estate glossaries before you get deep into the home buying process. The last thing you want is to sign a document that uses terminology you don’t understand!

2. Review your debt-to-income ratio.

This ratio represents your amount of monthly payments (bills) compared to your average monthly income. Debt-to-income ratio is one of the things mortgage lenders will look at when qualifying you for a loan. Most lenders will prefer your debt not to exceed 20% of your net monthly income. If your debt is more than 20% of your income, it’s time to pay down some of those bills. You’ll have a much easier time qualifying for a loan if you do.

3. Set your home buying budget.

By using a mortgage calculator, you can get a pretty good idea of how much mortgage you can afford to pay each month. This directly corresponds to the amount of home you can afford to buy. Once you have an approximate budget in mind, you’ll be able to limit your home search to those homes that fall within your budget range. This will save you a lot of time and hassle, while keeping your home search financially feasible.

4. Start saving your cash.

Unless you’ve just won the lottery, there’s a very good chance you’ll need some cash reserves during the home buying process. For one thing, mortgage lenders like to see that you’ve got some money saved for your settlement / closing costs. Secondly, the additional cash will come in handy for moving expenses, furniture purchases, home insurance, and all the other compiling costs that go along with buying a home.

5. Review your credit report.

Order a copy of your credit report and look it over for errors, inaccuracies, or anything that just seems odd. This is one of the first things a mortgage lender will do when considering you for a loan, so it makes sense to conduct your own review first. The easiest way to obtain copies of all three reports at once (from Experian, TransUnion and Equifax) is to visit www.AnnualCreditReport.com.

6. Fix credit errors quickly.

If you review your credit report and find something that doesn’t seem right, go to the company’s website who produced the report (TransUnion, Equifax or Experian) to submit a correction request. These companies are required by law to examine any reported errors on credit reports, and to correct them if necessary. But the process can take time, so you want to stay on top of it to resolve it quickly.

7. Get pre-approved for a loan.

During pre-approval, a mortgage lender will review your credit report, income and overall debt to determine how much of a loan you qualify for. With a “pre-qual” letter in hand, you can be more confident about your buying power in the real estate market. It also shows sellers that you’re serious about (and capable of) buying a home. This can be an important factor if the seller receives offers from multiple buyers, as they will likely consider those who have been pre-qualified above those who have not.

* You may republish this article online if you retain the author’s note below with the active hyperlinks intact.

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Ron Olive asked:

Find the best homes and land in North Idaho!

So you want to buy a home but don’t know where to start? Here is a simple checklist that will take you from dreaming about your new home to owning your new home!

Step One: Get an idea of what you want by asking yourself why you want to move. Perhaps you are upsizing to a larger home or downsizing to a smaller one. Perhaps you got married or you changed jobs or you want a similar home in a different neighborhood. By asking yourself why you want to move you will be helping yourself answer these questions as well:

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How many square feet should be in my new home?

How many beds and baths?

What areas am I willing to consider for my new home?

Do I have any special needs for my home?

Step Two: If you already know how much home you can afford – Congratulations! This will be important information to give to your Realtor to find the right home! If, however, you are like most people you may not be able to put a dollar figure on the total amount that you can borrow just off the top of your head. But you probably know how much you currently pay in rent or mortgage payments. Even knowing a monthly payment amount (and whether you wish to stretch or shrink that amount with a new home) can be a tremendous help to a licensed Realtor. If you don’t already keep a budget then start keeping a very basic pen and paper budget so you can identify your discretionary spending – money that you spend each month but don’t have to spend – so that you can determine how much of that to invest in your new home.

Step Three: Contact a Realtor by phone or online and let him know what type of house you are looking for, the general area or areas you will consider, and either the total amount of the house you can afford or the rough amount that you would consider paying each month as your mortgage payment. Armed with this information the Realtor can provide you will several options by emailing you houses that fit your criteria. If you see one that you like the Realtor can set up an appointment to view the home. If you do not see a home that you like then re-contact the Realtor and tell him why the options you were given didn’t work. Are you looking for a newer home but the first set of homes emailed were all older homes? Were you looking for a home on land but only homes on small lots were provided? Did you want a home with a finished basement but only ones with unfinished basements were sent? You may also use an online request form to get your home search information by email!

Most people look at 7-15 homes before they zero in on the one they want. Coupled with the fact that many people don’t know what they want “until they see it” and it is no wonder that the first few homes people look at aren’t anything like the home that you imagined! But as you continue to work with your Realtor, in person and by email and phone, you will both zero in on the type of home that you want.

Step Four: Get pre-qualified. It can take as little as five minutes over the phone to determine how much home you can afford. If you are selling your existing home the Realtor can help you find out how much equity you have in your home that you can use to invest in a down payment on a new home. Getting pre-qualified is actually one of the easiest steps of the process – and one of the most important! Without pre-qualification you will just be a “tire kicker” and won’t be able to zero in on a viable home to purchase. But once this step is completed you may find that your new home has suddenly jumped within striking distance! Get excited! That new home is quickly becoming a reality after completion of this step!

And just to make it easier we now have online pre-qualification contact forms. Enter some basic information and a mortgage lending representative will contact you shortly. These trained representatives may be aware of several programs that you have not heard about – programs that may open up new possibilities for you!

Step Five: Have the mortgage lender fax a pre-qualification letter to your Realtor so he can help you zero in on the one home that will work best for you!

Step Six: Sign an exclusive buyer’s representation agreement so the Realtor can conduct a CMA. If you are buying a new home the Realtor should conduct a Competitive Market Analysis on the home you wish to purchase. In addition to the CMA the Realtor can provide you with additional information like the number of days on market, if the price has been reduced previously, provide you with a property report and other information that can assist you in making an informed offer on the home. In addition if you are selling your home you will want to see a CMA so you can effectively price your home. One fact has remained consistent throughout the years in the Real Estate market: Properly priced homes sell. Improperly priced homes remain stagnant and generate frustration for buyers, sellers and agents! Make certain your home is properly priced!

Step Seven: Work with your Realtor to make the most efficient offer possible, incorporating the necessary safeguards into the offer. If you must sell your home before taking possession of a new home, any offer on the new home should be contingent upon the sale of your existing home. If you are not in a hurry to move you may be able to offer less than asking price, particularly in a declining market. If you need to move quickly or you know that you are in a period where prices are increasing rapidly then you may need to be much more aggressive with any offer presented. While it is the Realtor’s job to represent your best interests, the less you communicate with your Realtor the harder it will be for the Realtor to address your needs. As you communicate with the Realtor you will find that his understanding of your needs will help him translate those needs into an effective Real Estate Solution.

Step Eight: Talk with your Realtor about the offer that you wish to make. Your Realtor’s advice can prove to be invaluable, but remember that it is ultimately your decision as to the offer that will be made. Once you understand the “whys” and “why nots” of your Realtor’s suggestions make the offer that is most reasonable to you.

Step Nine: Regardless of whether the offer is accepted, rejected or countered, follow your agent’s lead from this point forward. Individual States, laws, procedures and methods vary. By now you should have created a solid bond with your Realtor and this trained agent will be invaluable in walking through the maze of paperwork and procedures that now need to be accomplished before you take ownership of your new home!

CONGRATULATIONS! Contact an agent now! Get pre-qualified!

When only the best will do the answer is clear – Sotheby’s International Realty

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Suzan Smith asked:

Sometimes it feels like you just can’t get ahead financially. You take one step forward, and then two steps back. At least it seems that way. And, in the current economic climate, it seems almost impossible just to make ends meet, much less get ahead at all. President Obama is helping people who qualify for the First Time Home Buyers Stimulus to not just get into a home, but get ahead financially, too.

Times are very hard, and many have lost their homes. Foreclosure is at an all-time high. Home sales have slowed down to a creeping pace, and market values have plummeted. But, what this translates to is that now is a great time to buy a home! You can take advantage of the lower prices and desperate sellers to get a home that would have cost you much more a year ago, and will probably be worth much more in another few years. And, on top of that, you may be able to qualify for the tax credit through this government program that can be up to $8000, or ten percent of the sales price of the home you purchase.

If you wisely reinvest that tax break into the principal of the home, you will have a rather sizable equity in the home in a very short time. When the market is restored, and it always is, you will be in a very good position financially due to your equity in your home.

This tax credit is available to those who meet the requirements, of course, but they are not difficult. You don’t apply to anyone for approval,, but you just take the tax credit on your income tax return. You cannot make more than $75,000 for one person and $150,00 for a couple. The home has to be closed on during the period between January 1, 2009, and December 1, 2009. It must be written on a primary dwelling, which means you live there.

If you think you may qualify for the First Time Home Buyers Stimulus, you should definitely find out more.

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Diane Salman asked:

Purchasing a home is the largest cheque most people will ever sign, so making sure you have all the information at hand before making your purchase is important.  In addition to your down-payment there will be various closing costs that you will need to think about as well.  These costs can add up to quite a substantial amount of money.  But for many home buyers, especially first-time home buyers, these extra costs could be offset, at least in part, by available rebate programs.  Here are 4 home buyer rebate programs you need to know about.

Land Transfer Tax Refund for First-Time Home Buyers

Every buyer in Ontario must pay the government a land transfer tax which is based on a percentage of what the home sold for.  First-time home buyers however can apply for a rebate for and receive a rebate for all of a portion of the tax paid.  Other provinces may have similar programs available and in Ontario the maximum amount that would be refunded is $2,000.  Some cities, such as Toronto, have also implemented their own land transfer tax but this too can be refunded to eligible buyers.  That’s nothing to sneeze at.

GST Rebate For New Home Purchases

If you buy a resale home you generally do not have to pay GST on the purchase price.  Not so however if you buy a new home construction.  New homes are subject to GST on the purchase price but there is a rebate program for this as well.  In general eligible new home buyers can apply for a refund of all or a part of the GST.  Keep in mind though that some builders include the GST in the price of the new home and any GST refund would go to them since they are the ones who absorbed the GST in the first place.

Affordable Housing Program

Government is continually trying to make home ownership affordable and available to everyone and with any government program the rules can be complex.  In a nutshell the affordable housing program allows those people who qualify to apply for a government grant for the down-payment of their home.  Municipalities and provinces have different rules as to who qualifies so check with your real estate professional for more details.

Home Buyers’ Plan

For most people looking to buy their first home the monthly mortgage payments are not the issue.  Mortgage payments are usually close to what they are already paying in rent.  The biggest obstacle to buying a home is coming up with the down-payment.  If you have money in your RRSP however you can withdraw up to $20,000 tax free for the purpose of using it as your down-payment.  This money needs to be paid back to your RRSP within fifteen years and payments need to be made to it every year.

It is important to do your research and speak with your real estate professional to find out more on theses programs and which ones you will be eligible for.  Even qualifying for only one program can save you a substantial amount of money.

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Marq Samsun asked:

Are you looking to buy a new home or fix up the house you are living in? If so, Obama has many programs that can help you get the money you need to buy a new house by giving up $15,000 to help with you down
payment.

Fact: Government grant money is available to help all US citizens regardless of their incomes and credit history.

Fact: Foreclosures are so high now that buying a home is the best choice than any American consumer could make. It is truly a buyers market.

There is no need to be paying the stupidly high interest fees charged by the bank now that the Obama administration is freely giving out these grants. Did you know that a large credit card bill of around $10,000 takes nearly 50 years to pay off, even if you keep up with the monthly repayments, because interest of 17% is so high.

If you have been looking for a new house but can’t afford the deposit, it is now possible to receive the money you need from the government. Don’t go to the bank, because you will lose out. The grant programs offered by the government allow you to easily receive all of the cash you have been waiting for.

Fact: The only way to get your money is to apply, because the government will never tell you about these programs.

Any American who is thinking of buying a new home should apply for as many grant programs as possible.

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Bill Carey asked:

The purchase price is not the only cost that effects your home buying adventure. Whether this is your first home or you are moving up or down in housing there are costs that will have a large effect on your ability to close the transaction. Some are required by your lender, some are required by common sense. Make sure you are budgeting for these 10 extra costs.

1) Mortgage Application, Brokers Fees, and Points – These costs can amount to thousands of dollars some like the application fee are poc (paid outside of closing) $200 to $500 depending on the lender. Broker fees a percentage of the loan are sometimes waived or rolled into the mortgage. Points .5% to 4.0% of the loan amount can be rolled into the loan or paid at closing this cost is based on your credit and buy down cost of the mortgage. Good idea to shop lenders.

2) Appraisal Fee – $150 to $550 can be higher they vary in price depending on the size of the property, complexity and price range. On larger more expensive properties banks may have an outside appraiser rather than their bank appraiser which will increase the cost. Paid at closing.

3) Survey Fee – Your bank or mortgage company may require a survey or updated survey depending on the local custom. Costs are from $400 to $1200 or more, this is one area where common sense says get a survey. A survey will give you the assurance that you are getting the property you think you are buying. It will show all buildings, sheds, garages, decks, porches, driveways, and walkways. It will also show whether your structures encroach on your neighbor’s property or his on yours.

4) Title Insurance – Most lenders require you to pay for a Lender Title policy a must do for you is to get an owners Owner’s Title Policy this will insure you against any claims of past issues that could affect your ownership of the property. Based on cost of the property several hundred to thousands of dollars.

5) Attorney’s Fees- Depending on local custom an attorney may be required. Real Estate transactions are complicated and a good real estate attorney can make a smooth closing. Based on hourly fees or fixed if they handle the closing, plan on $400 to $900.

6) Property Taxes – You will be required to reimburse the seller for pre paid taxes or you may be paid from the seller’s funds if taxes were not paid. Any event you will put money into escrow usually 3 months that is held by the lender to pay the taxes when they come due.

7) Homeowners Insurance – POC 12 months in advance required by the lender.Also 3 months escrow by the lender at closing. Based on cost of the property, type of construction, location, your personal credit rating and previous insurance usage.

Homeowner Association Dues/Fees – You will be required to reimburse the seller for any pre paid homeowner fees. Depends on subdivision location condos, townhouses, and gate communities will have them. This should be listed on the seller’s disclosure documents.

9) Transfer Tax – Normally paid by the seller sometimes split with the buyer in the sale price. Some states are as high as 4.5% of the sales price check out state laws could be thousands of dollars. Paid at closing to the state, county and city.

10) Miscellaneous Service Charges – First time home buyers get hit hard here check out the hook up fees for electric, gas, cable, and telephone. Also deposits if you have no track record of paying utilities. Hundreds of dollars.

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