Colorado Mortgage Team

Now that home prices have leveled in many parts of the country, many first time homebuyers are looking for creative ways to move into the home of their dreams.   FHA, the Federal Housing Administration, is making it easier for many to purchase with low down payment requirements.This helps home buyers enjoy the current ,000 tax credit being offered through the end of the year.    What is FHA doing to make home buying so affordable?

For starters, you can finance a new home with very little down.   3.Exactly 3.5% of the purchase price.   Unlike a conventional loan which requires at least 10% down with exceptional credit, first time homebuyers can get the keys to a new home with just 3.with 3.5% down, and it does not have to be your money.The money can be given to home buyers by a family member.    Conventional loans for years have been the staple for purchasing new homes.First time homebuyers took advantage of 100% financing and many utilized 80/20 loans.   Now, expect to pay anywhere from 10 to 20 percent down to get a conventional loan, and above 80% is going to require Private Mortgage Insurance.

FHA also allows first time home buyers the opportunity to purchase when conventional lenders issue a denial.   Because FHA loans are insured by the Federal Government, the loans are a bit more leniant on credit standards.   For most conventional loans, a 680 credit score is required, with otherwise flawless credit.A 620 credit score will be required by most lenders for an FHA home loan.Most lenders will require a 620 Fico score for FHA, although a select few will allow scores down to 580.

FHA is a very strong option for purchases.   Although 3.100% of the 3.5% down payment requirement can be gifted.This means you can have your down payment gifted by a family member, and own your home putting any of your own money down.   

Up to 6% of the purchase price can be in the form a seller concession.   Conventional loans limit the seller credit to 3%, while you can go as high as 6% through FHA.This money can cover closing costs or any prepaid items such as setting up an escrow account for taxes and insurance.   A very popular option is to use the money to take advantage of the 2-1 buydown feature.   By taking advantage of this concession, buyers can get an interest rate 2% below market in the first year, and 1% below market the second.   

You can also expect the appraisal process to be a little smoother with FHA compared to a conventional appraisal.    With a conventional loan, lenders are required to order an appraisal through a panel, a process known as the Home Valuation Code of Conduct.

FHA has been around since 1934, and now represents almost 50% of the purchase market.The growing popularity among first time homebuyers has been incredible over the last few years.    To find out more about how to qualify for an FHA home loan, visit http://www.timmarose.com

The first time you do anything is always the scariest – buying a home is no different. There are no secrets to the process that you need to go through to get a home. {Even for people who have not yet been through the homebuying process, there are really no secrets to the process of buying a home}. It is a big deal, and no one will blame you if you are nervous but try to focus on being excited.

Get Pre Approved – Get Pre Qualified

First, you will want to get a copy of your credit report – even if you have to pay for it. Be sure to take the time to review your report so you know if there is anything inaccurate on it. Here are the things that  you will need to get pre-qualified or pre-approved:

• Gather your financial information – 30 days of pay stubs, 2 months of bank statements, last quarterly IRA and 401K statements, last year’s W2’s.
• Research Loan Programs, FHA Home Loan Options, First Time Home Buyer Programs
• Find a Mortgage Company or Lender to work with – list of questions to ask Loan Officer
• With your lender, determine the price range of homes that you qualify for. You will need your credit report and your financial information to complete this.
• Determine how much you think you want to spend each month on your mortgage payment.

Shop For A Home To Buy – Find a Realtor

Step number one is to find a Realtor and you can easily find one online.

Start your home search based on the price range you qualify for, and the location and home features that you want. The agent should set you up on some sort of automated email system that will send you new listings every day. Another place to look is PropertyNut.com.

Ask the Real Estate Agent for a sample contract for you to read and ask questions about. You want to have an understanding of what’s in the contract before you write the real one.

After you have worked with your real estate agent to pick out some homes you would like to see, then it is time to go look at each one. Take notes about each home you visit. Trust us on this; you won’t remember the specifics otherwise once you visited more than about 5 homes.

When done looking at homes – you’ll know when this is as you will have some homes that you want to revisit – schedule time to take second looks. This time take more detailed notes. Important characteristics in a home to consider.

If you find a home that you want to purchase, let your agent know and sit down with your agent to write up a sales contract offer.

If your offer is accepted, your agent can help you make sure that appropriate inspections are scheduled and completed.

Get Loan Approval From Mortgage Lender

Now is the time to make sure that you are pre-approved with your lender and not just pre-qualified. If you haven’t already, provide your loan officer with 30 days worth of pay stubs, your last two months of bank statements, your last quarterly statements from your IRA/401K’s if applicable, W2’s, maybe your tax returns, and any other information your loan officer might ask for.

Purchase Home Owners Insurance Policy

After working with the loan officer, now it is time to work with the insurance company to find the right homeowner insurance policy for you home. The effective date that your policy starts coverage should be the day that you close on your new home at the title company. Make sure that you get a couple of quotes as there are going to be differences in what you are charged.

If necessary you will have to purchase flood insurance. It is a good idea to find out during the sales contract phase whether the home is in a flood zone or not. Flood insurance is much more expensive than regular home insurance.

Closing Time Means You Now Own The House

Talk to your Loan Officer and Real Estate Agent to make sure everything is on track to settle on time about 1 week in advance.  Usually about a day or two before signing the final paperwork on your house you need to do a walk through. If you have to bring money to your settlement, make sure that you have it in the form of a cashier’s check, a bank check, or a wire.

If you follow these steps as a guide, you should not come across too many mysteries or surprises in your home buying experience.

Thinking about buying a new home? Here’s an opportunity to save more money. Everyone likes to compare the best value when shopping, and take advantage of special offers in order to save money, why not do the same when you buy a new home?

Home builders may offer what is called a broker co-op, which is a sales commission offered to a real estate agent as an incentive to show clients their new homes. The real estate sales commission may range from 3% to 4% of the home sales price.

Many real estate agents are now offering to share their commission with their home buyer clients. Before making an offer to buy a new home, a buyer can make an agreement with an agent to represent them, in exchange for a share of the commission paid by the home builder.

The amount of money a buyer can save depends on the share of the commission, which is negotiable with the agent, and the sales price of the home. For example, buying a new home with a sales price of $500,000, with a 1 1/2% share, would save the buyer $7,500.

The buyer can receive a check at the close of escrow, or the money may be applied to the down payment or closing costs, providing there are no restrictions from the mortgage lender, or state laws that regulate real estate transactions.

Most new home builders don’t usually advertise a broker co-op offering, so the buyer, or the buyer’s agent would have to ask. The home builder may have a requirement for the buyer’s agent to be with them when visiting the office, or signing paperwork to buy a new home, so be sure to clarify the rules. A little time spent on research could mean a lot of money saved on your real estate transaction.

Information on Ditech home loans, refinance loans, also, information on Brookfield new homes in San Diego

When you think of real estate investing, a number of things may come to mind. Depending on how familiar you are with real estate investing already, you might think of real estate portfolios and real estate retirement plans, or you might focus on short sales, bulk reo investing and virtual real estate investing. You probably also wonder how these things play out in real estate investors’ life in the current economy.

You can learn a lot about real estate investing. Knowing the basics of real estate investing education is a good way to get the most out of every lesson. You will get the most out of anything to do with short sales, bulk reo sales, virtual real estate and just improving real estate investor abilities by knowing some real estate investing basics. Here are three main real estate investing concepts that many experts do not even know:

1. Real estate investing education is a true investment that always has a positive yield. Each real estate deal can represent thousands of dollars in potential wealth. Understanding how to get that wealth will be the key to your success. Learning as much as possible about real estate will increase your odds of success whenever you do a real estate deal. A small investment in your education can yield big results when you implement your learning.

2. You can succeed in real estate investing regardless of the state of the economy. Often people think that you can only be a success in real estate when the economy is good. In fact a bad economy is not a bad economy for real estate investors. Likely you will be able to find properties at deep discounts. Additionally, you may find deals that would not exist in a booming economy. In fact, real estate investing can turn the tide for a poor economy. Short sales, bulk reo sales and virtual real estate all thrive when the economy is less than thriving. You will have the option of saving yourself and possibly others from serious financial difficulties if you know about these types of deals.

3. A lot of money is not vital to your success as a real estate investor. You can succeed in the real estate investing arena no matter how much money you are working with. Many types of deals enable you to use other people’s money to do them. If you are a good investment private lenders may let you use their money. The best way to look like a solid investment is to have an in-depth knowledge of real estate investing. This will help you show people that you are a good investment if they have the money to help you with real estate investing but they do not know how to use it.

A good deal of wealth can be generated with real estate investing. You can create income regardless of the economy. Using knowledge of real estate investing, short sales, bulk reo sales and virtual real estate you will be able to create success for yourself. Knowing real estate investing basics will help you succeed as a real estate investor.

Many people across Colorado are searching for more information about how to use the 8000 tax credit for closing costs when buying a new home.

The Colorado Housing Finance Authority released important information for anyone who is interested in using the 8000 tax credit for closing costs when buying a new home in Colorado.

CHFA JumpStart Home Mortgage Product Highlights

• Designed to help Coloradans leverage the first time homebuyer federal tax credit for down payment or closing costs.
• Offers borrowers a first mortgage with a competitive 30 year, government insured fixed interest rate, AND a zero percent (0%) second mortgage with no payments if the second mortgage is repaid before June 30, 2010.
• The second mortgage may be a maximum of 3.5 percent of the home’s purchase price, or $6,000, which ever is less.
• Available from CHFA’s approved lenders for homes purchased and closed between April 1, 2009 and Nov.30, 2009.
• Must be a first time homebuyer and complete a free homebuyer education class to qualify.
• Income and purchase price limits apply. View the limits in your county on CHFA’s website www.chfainfo.com.
• $250 of CHFA’s $350 administrative fee will be returned to borrowers who pay off their second mortgage prior to June 30, 2010.
• The interest rate on the second mortgage will increase to 8 percent with a 10 year term if not paid off by June 30, 2010.
• CHFA urges borrowers who don’t plan to pay off second mortgage by the June 30, 2010 deadline to use the CHFA HomeOpener Plus mortgage product.
• CHFA HomeOpener Plus offers borrowers down payment and closing cost assistance at competitive market interest rates with a 30 year loan term.

While the rules associated with the 8000 tax credit loan may seem like there are lots of them, it is good to know that Colorado is one of the few states in the Nation where people can get help to take advantage of programs designed to help people use the 8000 tax credit for closing costs when buying a new home.

More Information: (www.chfainfo.com)

• CHFA JumpStart Brochure
• CHFA JumpStart Fact Sheet
• CHFA JumpStart Information Sheet
• Press Release: CHFA Brings Stimulus Dollars to Homebuyers

Many people across Colorado are considering buying a new home and have heard at least *something* about the 8000 tax credit for new home buyers. If you are one of the people who have heard something about it and are thinking about buying a home somewhere in Colorado — don’t worry, you aren’t the only one wondering!

Some of the most popular questions that people ask right here in Colorado have been answered nicely by the National Association of Home Builders and they have also put together a video that will most likely answer the questions that you may have.

If you have more questions, be sure to contact us – we are Colorado Mortgage Experts!

Some of the top questions that we have heard from people are also below — if you have a different question after seeing all of these, let us know!

1. Who is eligible to claim the tax credit?
2. What is the definition of a first-time home buyer?
3. How is the amount of the tax credit determined?
4. Are there any income limits for claiming the tax credit?
5. What is “modified adjusted gross income”?
6. If my modified adjusted gross income (MAGI) is above the limit, do I qualify for any tax credit?
7. Can you give me an example of how the partial tax credit is determined?
8. How is this home buyer tax credit different from the tax credit that Congress enacted in July of 2008?
9. How do I claim the tax credit? Do I need to complete a form or application?
10. What types of homes will qualify for the tax credit?
11. I read that the tax credit is “refundable.” What does that mean?
12. I purchased a home in early 2009 and have already filed to receive the $7,500 tax credit on my 2008 tax returns. How can I claim the new $8,000 tax credit instead?
13. Instead of buying a new home from a home builder, I hired a contractor to construct a home on a lot that I already own. Do I still qualify for the tax credit?
14. Can I claim the tax credit if I finance the purchase of my home under a mortgage revenue bond (MRB) program?
15. I live in the District of Columbia. Can I claim both the Washington, D.C. first-time home buyer credit and this new credit?
16. I am not a U.S. citizen. Can I claim the tax credit?
17. Is a tax credit the same as a tax deduction?
18. I bought a home in 2008. Do I qualify for this credit?
19. Is there any way for a home buyer to access the money allocable to the credit sooner than waiting to file their 2009 tax return?
20. If I’m qualified for the tax credit and buy a home in 2009, can I apply the tax credit against my 2008 tax return?
21. For a home purchase in 2009, can I choose whether to treat the purchase as occurring in 2008 or 2009, depending on in which year my credit amount is the largest?

Federal Housing Tax Credit.