Buying Real Estate Panic = Regret + Loss of Money and possibly worse...

Everyone knows that when you buy something in a panic, without doing proper research, you create a lot of room for regret. Real Estate is just the same way except that this regret will result in wastes of money and a loan that you have to pay off monthly... OUCH!!

So what has caused the consumer to rush into real estate without proper knowledge and research? The examples are endless but some are the record low interest rate, rumors of the interest rate rising, tougher mortgage qualifications, rising home prices, and also the tax credit that is coming to a close.

Buyers are ready to plunge in immediately and many are AFRAID that if they don't act now they might miss their Real Estate opportunity.

The BIGGEST tip for any homebuyer in this market is to "buy the least of the best". What this means is to buy the cheapest house on the best street that you can AFFORD or possibly a smaller unit in the best condo that you can AFFORD. This way improvements made by neighbors will also improve the value of YOUR property. If the subprime crisis has taught us anything it is to invest in real estate that you can AFFORD.

To help you purchase a home with the least pain and panic as possible follow these easy steps:

1. Search for a Real Estate PROfessional who has experience and knowledge with the location and property type you value. Don't just go with the first professional you bump into.
2. Keep asking "Why?" the purpose of this is twofold. If you educate yourself you have more control over the situation AND if your agent can't answer "Why?" chances are you need a NEW agent.
3. Get to know the neighborhoods you want to live in, with each neighborhood there is a gradient of differing values.
4. Seek out a knowledgeable and reliable home inspector who can address the quality of construction and property devaluators.
5. Pre-qualify with a mortgage broker who can provide access to funds beyond traditional lenders.
6. Write down what you "need" and what you "want". These two are completely DIFFERENT things, by classifying what you really need you are able to cut down the costs wants that you might not need.

Credits to:
Realty Times - Prepare to Avoid Buying Panic

Thomas Feng, Realtor
Thomas.Feng@CBnorcal.com

Copyright 2010 by Thomas Feng, All Rights Reserved. You may reblog or republish with links back to this post.

* THIS ARTICLE WAS ORIGINALLY PUBLISHED AT http://www.SaratogaHouses.blogspot.com *

The $8,000 tax credit is great BUT what if we need more??

Now that you know what the tax credit is chances are you have started to look into moving into that new home. Great News, however a lot of you are still saying, "With this economy, is this the best move right now? Are there other sources we can go to for help financially?"

If you live in the Santa Clara County, you’re in luck. We have many unique programs, by the Housing Trust of Santa Clara County, that are designed to provide help to those looking to purchase their own home. The Housing Trust also has other programs to help non first time purchasers and you can find that information here. In this post we will be talking specifically about the programs they have available for a first time home purchaser.

Chances are you have never heard of the Housing Trust of Santa Clara County so let’s start by talking about who they are. The mission of the Housing Trust of Santa Clara County is to make Silicon Valley a more affordable place to live. They make loans and grants to increase the supply of affordable housing, prevent homelessness and assist qualified individuals and families to buy their first home. They are nationally recognized for providing the resources and leadership needed to make housing more affordable for those who want to live in Santa Clara County. This is accomplished by leveraging voluntary contributions from local Silicon Valley companies with public funding to make a meaningful impact countywide.

The current programs offered by The Housing Trust for first time purchasers are: the Closing Cost Assistance Program, ESCO, a Mortgage Assistance Program, and a Down payment Assistance Program. At the most basic level what The Housing Trust does is provide secondary loans, those under the primary. The purpose of a secondary loan is to secure additional money to finance the property so that you can bring down your loan to debt ratio, this way you don’t have to deal with paying Private Mortgage Insurance.

• The Closing Cost Assistance Program provides up to $6,500 towards the closing costs or other transaction expenses associated with a home purchase. More information on the Closing Cost Assistance Program can be found here.
• The Down payment Assistance Program provides deferred payment second loans of up to $15,000 to homebuyers financing their home with a NHSSV first mortgage. More information on the Down payment Assistance Program can be found here.
• The Mortgage Assistance Program helps homebuyers finance their first home or condominium; second loans up to $35,000 are available under this program. More information on the Mortgage Assistance Program can be found here.
• The Equity Share Co-Investment (ESCO) Program is a new program to assist qualified homebuyer get on the property ladder through a new down payment assistance program. More information on ESCO can be found here

Because of the many legal and tax situations that can arise through the sale and purchase of real estate ALWAYS consult with your ATTORNEY or ACCOUNTANT before getting into contract.

Credits to:

Santa Clara Housing Trust

Thomas Feng, Realtor

Thomas.Feng@CBnorcal.com

Copyright 2010 by Thomas Feng, All Rights Reserved. You may reblog or republish with links back to this post.

* THIS ARTICLE WAS ORIGINALLY PUBLISHED AT http://www.SaratogaHouses.blogspot.com *

10 tips for first time homebuyers, rent or buy??

Some stats for the year 2010 as predicted by the National Association of Home Builders:

• New single family home starts will jump nearly 40% this year to 610,000 units
• The number of foreclosure notices could surpass last year's 2.8 million
• Mortgage rates have continued to fall in 2009 and are stabilizing around 5% for a 30 year conforming loan
• The first time homebuyer tax credit, up to $8,000, is scheduled to end on April 30th of 2010

Just from looking at these stats many have realized that now might be a great time to purchase a home. This has led to an increase in the number of first time homebuyers. Before you take the big step of purchasing a home read through these 10 tips (in no order of importance) that can help you in the process and hopefully stop headaches before they happen.

1. Own or Rent? - Owning a home is expensive. In addition to the down payment and mortgage, you'll have to pay for closings costs, insurance and maintenance. To figure out whether it's financially smarter to buy or rent in your area, calculate and compare total home ownership costs to rental rates.

2. Consider Monthly Costs - Even if you can scrounge up a down payment, figure out before buying a home whether you can comfortably cover the full costs of ownership--including the mortgage, taxes, insurance and regular fix-up costs.

3. If you're buying your first home, the feds have a deal for you: An $8,000 income tax credit for those who sign a binding contract before May 1. Then again, it's entirely possible that, like past deadlines, this one will be extended.

4. Getting a Government-Backed Loan - As of this month, mortgages guaranteed by the Federal Housing Administration got harder to come by. Would-be buyers with a credit score of 580 or less now must put up a 10% down payment. That too may change.

5. Avoid Family-Assistance Tax Traps - Before applying to the Bank of Mom & Dad, note that outright cash gifts can result in big tax bills. Avoid them by structuring parental assistance as a bona fide loan with minimum interest rates set by the Internal Revenue Service. Forms for such transactions are posted at sites like Nolo.com.

6. Consider Foreclosures - Foreclosed homes often sell at discounts--but you'll have to act fast and often with help from a real estate agent who specializes in foreclosures. It also pays to first get a mortgage pre-approval letter from a lender. Among the best markets for foreclosures: Phoenix, Las Vegas and central Florida.

7. Factor in Property Taxes - Got your eye on a dream home in Westchester County, N.Y., or Marin County, Calif.? Both are property tax danger zones, according to a recent Forbes analysis. Before taking the plunge, consider the thousands of dollars a year you might save by moving a county or two away.

8. Beware of Title Insurance Rip-Offs - In some states, home buyers can save as much as $1,000 on title insurance by shopping around, says Carolyn Warren, author of Homebuyers Beware. Also note that some states mandate lower rates for a buyer if a property's previous owner purchased title insurance within the past few years.

9. Consider High-Deductible Home Insurance - If you're a do-it-yourselfer moving into a new home, consider lowering your homeowners insurance premium by raising the deductible. Even if you're buying an older home, or aren't too handy, it might not be cost effective to pay a lot in extra premiums to insure against that last dime of potential liability.

10. Cut Insurance Costs By Upgrading - Security systems, smoke alarms and other upgrades can cut your insurance premiums. It can also pay to insure your home with the same company that covers your car, boat or other property.

Because of the many legal and tax situations that can arise through the sale and purchase of real estate ALWAYS consult with your ATTORNEY or ACCOUNTANT before getting into contract.

Credits to:
Forbes Ten Tips For First Time Homebuyers

Thomas Feng, Realtor
Thomas.Feng@CBnorcal.com

Copyright 2010 by Thomas Feng, All Rights Reserved. You may reblog or republish with links back to this post.

* THIS ARTICLE WAS ORIGINALLY PUBLISHED AT http://www.SaratogaHouses.blogspot.com *

Not a First Time Homebuyer? Here's how you may get a $6,500 tax credit.

Many of you may have heard of the first time homebuyer tax credit of up to $8,000 that was implemented last year in 2009. However what if this is not your first time buying a home, what if you own a home right now but want to move up due to the lucrative market conditions. There is also a tax credit for you, the $6,500 tax credit is for those who have lived in their principle residence for 5 out of the last 8 years and want to make the move (up or down) into a new home. Another criteria is that the homeowners income doesn't exceed $125,000 (if taxes filed singly) or $225,000 (married filed jointly).

One restriction to the tax credit is the house you move into must be your new principle residence. If you sell or stop using the home as your principle residence within three years the government will take back the tax credit. Another restriction is the fact that no matter what you purchase the house cannot cost more than $800,000

Lets remember however that this is a TAX credit, NOT free money. This money will be credited to you when you file your tax returns in either 2009 or 2010. But with this information you can spend that money now to fix up your lawn, repaint the house, and redecorate the interior which will bring you a higher price on your property and use the credit, come tax time to pay off your bills.

Because of the many legal and tax situations that can arise through the sale and purchase of real estate ALWAYS consult with your ATTORNEY or ACCOUNTANT before getting into contract.

For more information on the Homebuyer Tax Credit visit the IRS tax credit homepage.

Thomas Feng, Realtor
Thomas.Feng@CBnorcal.com

Copyright 2010 by Thomas Feng, All Rights Reserved. You may reblog or republish with links back to this post.

* THIS ARTICLE WAS ORIGINALLY PUBLISHED AT http://www.SaratogaHouses.blogspot.com *