Advice: Anybody Good with Home Buying / Real Estate?

[NattyLight]

Hi guys, my fiance and I our buying our first house and was wondering if I could get some advice because I suck at money.

First off, my fiance and I applied for a zero down loan through USAA and spoke with a mortgage counselor to do so (required). She basically prefaced the conversation that VERY FEW applicants are getting approved for 0 down now a day and pretty much said that 5% down is likely the only option.

So, I said lets go through the process and and see where we stand. It came back that we had excellent income to debt ratio, but she stressed that it really comes down to our credit rating. My fiance's credit is excellent, I knew this, but mine was the one I was worried about. I'm 28 years old and never pulled my credit, but knew it was far from great.

It surfaced that mine is average (literally, the average for the state I live in). With all of these factors considered we were approved for a 0 down, 30 year fixed loan of our maximum purchase consideration. I'm really excited.

However, I don't think the interest rate is very competitive because of my average credit rating was considered/ 0-down, at 6.675% which is pretty much translated to 7% when "cost of doing business", taxes, and other stuff is included.

(1) Does this interest rate suck balls?

(2) What's the best way to compete for better interest rates and terms from other lenders? I heard Lending Tree was awful.

(3) I know you can write your interest payments off come tax time, does this infer a larger return when taxes are filed?

Also, a real estate guru I am not, so I was wondering if there are any guidelines/tips for making an informed undercut bid to the seller. You know using recent price cuts, previous sales prices in the neighborhood and time on market, etc as the determining factors of how low to bid below the asking price.

Thanks in advance for any responses.

[allsup]

1. with zero down 6.625% is a good rate

2. you can improve your rate by putting $ down

3. yes

[DjTj]

6.675% for a zero-down loan actually sounds pretty good to me. If you can lock that rate, I would definitely do it.

I just closed on a re-fi today at 5.875% for a 30-year fixed, and that's with 20% down. If you can come up with some money for a down payment (borrow some money from relatives, etc.), that's really the only way you'll get a better interest rate.

You get a full tax refund on any interest paid, which can be pretty substantial in the early years of the loan. Depending on what tax bracket you're in, you can basically consider it a 20-30% discount on your mortgage payments.

As for negotiations, you should get a real estate agent to help you as far as checking local prices and whatnot.

[DCsportsfan53]

That rate is decent but could be a little lower, even with 100% financing. Somewhere closer to 6.25 should be doable.

[NattyLight]

OK, so that's good news. Does anybody have any experience or knowledge in Real Estate speculation? I know that this is the wrong climate to consider it, but there are two properties I'm extremely interested in that are priced about 40K apart. Each one has its advantages, but I think the more expensive one could be the better investment? If any one's will to have an interchange, let me know, because I'm interested in seeing if my assumptions are valid.

Thanks again.

[freakofthesouth]

I am an Agent, and I will be submitting my resignation come next year because the housing economy is terrible, and our country is heading into a serious recession. My advice is- be careful getting yourself into massive debt. And good luck!

[jbooma]

I am an Agent, and I will be submitting my resignation come next year because the housing economy is terrible, and our country is heading into a serious recession. My advice is- be careful getting yourself into massive debt. And good luck!

It is terrible if you are trying to sell your home at an inflated price. If you are selling your home at a decent price it will sell but it will take months, you know how it was back in what we call the real world. The world where you needed $$ to buy a house instead of a loan someone threw at you.

The interesting thing is it seems those who got rich in the internet craze, got rich, then laid off, then a lot of them went into, yes you got it real estate and mortages, and got rich again. Now they are running yet again.

[Spaceman Spiff]

It is terrible if you are trying to sell your home at an inflated price. If you are selling your home at a decent price it will sell but it will take months, you know how it was back in what we call the real world. The world where you needed $$ to buy a house instead of a loan someone threw at you.

Truth.

My teams business went up 25% this year. Market is only bad to the people who don't take time to understand what the current market is. Very easy to throw your hands up and say it's a bad market, my house won't sell.

[DCsportsfan53]

Truth.

My teams business went up 25% this year. Market is only bad to the people who don't take time to understand what the current market is. Very easy to throw your hands up and say it's a bad market, my house won't sell.

Definitely agree. My company is actually growing right now, hiring new loan officers, adding licenses in new states, ect, filling the void left by all the lenders and brokers who went under. Some people lived on refis and stated income loans in a boom but that never lasts. If you can't understand the condition of the market, adapt and find a way to put your clients into good situations that actually help them accomplish their long term goals, you had no business being in the business to begin with. It's basically a purge. The people who are left are the ones who know what they are doing and take the time to understand the economic climate, rather than simply cashing in on a boom, often at the client's expense.

[Ancalagon the Black]

Here's a good way to accomplish long-term goals: rent, and buy a house in 2012.

[DCsportsfan53]

Here's a good way to accomplish long-term goals: rent, and buy a house in 2012.

You ain't kidding. Anyone who thinks the market's coming back up much sooner than that is delusional. Although the flip side to that is, obviously, rents are going up since not too many people are buying. It just depends on the individual and the specific situation.

[rainmkr]

I am an Agent, and I will be submitting my resignation come next year because the housing economy is terrible, and our country is heading into a serious recession. My advice is- be careful getting yourself into massive debt. And good luck!

I agree, this is a major buyers market make sure you get yourself a GOOD PRICE and don't buy some jacked up deed restricted commune with crazy ass HOA fees and such.

I bought my first home in Tampa last year right before the **** hit the fan. I went 100% through USAA and probably would not qualify for the same loan now, but I spent the money fixing up an old 1600sq ft home built in the 20s that needed a LOT of work. putting 20% would have made me put off fixing the place and while it's been tough some days, I never appriciated any purchase I've made more in my life.

Unlike some people who've bought property in the past 2-3 years I have the income to cover my the costs of improving my home while making the basic payment. Hopefully you also live in a state that is kinder than Florida when it comes to homeowners insurance and property taxes. Those 2 things are the single biggest drains on me.

[Destino]

You ain't kidding. Anyone who thinks the market's coming back up much sooner than that is delusional. Although the flip side to that is, obviously, rents are going up since not too many people are buying. It just depends on the individual and the specific situation.

Why, may I ask, would you want the market to come back if you are buying your first home? The best situation is a down market. If you wait for a rebound (or at least until it's commonly known) then you will pay more.

Also keep in mind that the shortsales popping up everywhere are at their peak and will not last at this level into 2009.

[Destino]

(1) Does this interest rate suck balls?

(2) What's the best way to compete for better interest rates and terms from other lenders? I heard Lending Tree was awful.

(3) I know you can write your interest payments off come tax time, does this infer a larger return when taxes are filed?

1- You haven't provided enough info to determine that. It might and it might not.

2- Shop around. I can look at your loan info if you like and give you a second opinion. There are a lot of factors involved some of which are more important than just the rate.

3- For tax advice ask a professional or google it. If you get more money back that depends on what else is going on with your tax situation.

PM me if you like, but definately get a second opinion.

[CurseReversed]

Hi guys, my fiance and I our buying our first house and was wondering if I could get some advice because I suck at money.

First off, my fiance and I applied for a zero down loan through USAA and spoke with a mortgage counselor to do so (required). She basically prefaced the conversation that VERY FEW applicants are getting approved for 0 down now a day and pretty much said that 5% down is likely the only option.

So, I said lets go through the process and and see where we stand. It came back that we had excellent income to debt ratio, but she stressed that it really comes down to our credit rating. My fiance's credit is excellent, I knew this, but mine was the one I was worried about. I'm 28 years old and never pulled my credit, but knew it was far from great.

It surfaced that mine is average (literally, the average for the state I live in). With all of these factors considered we were approved for a 0 down, 30 year fixed loan of our maximum purchase consideration. I'm really excited.

However, I don't think the interest rate is very competitive because of my average credit rating was considered/ 0-down, at 6.675% which is pretty much translated to 7% when "cost of doing business", taxes, and other stuff is included.

(1) Does this interest rate suck balls?

(2) What's the best way to compete for better interest rates and terms from other lenders? I heard Lending Tree was awful.

(3) I know you can write your interest payments off come tax time, does this infer a larger return when taxes are filed?

Also, a real estate guru I am not, so I was wondering if there are any guidelines/tips for making an informed undercut bid to the seller. You know using recent price cuts, previous sales prices in the neighborhood and time on market, etc as the determining factors of how low to bid below the asking price.

Thanks in advance for any responses.

If your wife has enough fully documented income to qualify for the loan on her own, and has great credit then you should just put the loan in her name. That way you will have all the prime conditions for the best possible rate.

Right now your credit score might be dropping the whole loan down into another rate bracket. Just make sure to tell your agent/title company to make sure you go on the title with her at closing

.

If you do it this way you should be able to get the best rate available for a 100 percent loan( or par ). Realistically it probably wouldnt be all that much lower then what you already have, which is at the least competitive but definitely beatable. Looking at my rate sheet it looks like you could get 6.25 if you are getting it without broker fees on the back end.

This is assuming that your wife indeed does have enough income and great credit 700+