Special offer

NO, It is NOT A Good Time To Buy!!!!! 4 Reasons Why You Should Wait.....

Reblogger
Real Estate Agent with HomeSmart Real Estate AZ Broker BR030809000

First Time Home Buyers in the Phoenix Area this is an excellent post written by a collegue of mine Pam Graham.  It's a must read before starting the process of buying your home. Call me if you need help in deciding if now is the right time for you to buy a home or how to make a plan to buy in the future year.

Original content by Pam Graham
 Did I get your attention? I know what you're thinking, a real estate agent in Jacksonville, not shouting it's a good time to buy, when most agents are on rooftops shouting, that it's a great time to buy. Prices are great, interest rates are low, but for some it's not a good time to buy. Here are 4 reasons you shouldn't buy a home:
 
1. You have no money to put down. Yes, there are a few no money down loans and some down payment assistance programs out there, but 100% financing gives you no wiggle room in equity, just in case you have to sell sooner than planned. Most down payment assistance programs are an interest free, no payment plan, unless you sell or refinance before 10 or 15 years, then you have to pay it back. Let's not forget PMI, private mortgage insurance, that you will pay each month, making your payment higher.

2. Your entire offer hinges on the fact that the seller HAS to pay your closing costs, because you don't have the money to pay them yourself. There's nothing wrong with asking the seller to pay your closing costs to help keep more money in your pocket, nothing wrong with trying to get a good deal. 
 
3. You're in debt up to your eyeballs. A house is more debt, that comes with property taxes, homeowner's insurance and maintenance repairs.
 
4. You have no savings. What happens if your new home has an unsuspected repair and you have no money put away for a rainy day?
 

Do any of those apply to you? If you answered yes to even one, it's NOT a good time for you to buy! I know that sounds harsh, but  let's look at the past few years and what's going on currently. Short sales are everywhere in the Jacksonville and Clay County Florida market. At the end of the day, let's be honest, the responsibility still lies with the homeowner and Not the banks, Not the government, and Not Wall Street. Many home owners have, not only a first mortgage, but a second or sometimes a third. I've seen a common trend amongst most short sale sellers.  Little or no down payment when they bought, no savings,  huge debt, multiple mortgages on their home and yes, there are some that have had unforeseen circumstances out of their control happened. Imagine though if they had no debt, and a savings, how much better off they would be, even with events happening outside their control!

Imagine yourself buying a home with 20% down. The seller agrees to pay your closing cost, so instead of paying them yourself (which you have the money in savings), you use that money to pay cash for new furniture. A 15 year mortgage, instead of a 30 year mortgage. No debt, so you can pay extra on your mortgage, so instead of paying it off in 15 years, you pay it off in 10? 3 to 6 months of expenses saved so if an unforeseen event occurs, it's not your family's total downfall.

I write this, because I'm currently taking the Financial Peace University by Dave Ramsey. I'm not taking this class because I have all my ducks in a row, that's for sure, but because I've been there and I want a better way for my family. If I had followed those 4 reasons above, when I bought my house, things would have turned out a heck of alot different.

I also hate seeing families have to leave their homes to rent because of financial difficulties and hope that today's buyers learn from the mistakes of current sellers, because really, we do have control over our own personal economy, even when our nation's economy is weak.

 

                     What's My Home Worth?      Search for Homes     Email Me

 Facebook    Google Plus  You Tube  Rss for my Blog 

 

Find me on Google+

Pam lists and sells homes in Jacksonville, Orange Park, Green Cove Springs, Fleming Island, Middleburg,Ponte Vedra, Atlantic Beach, Neptune Beach, Jacksonville Beach, Orangedale, Fruit Cove, Switzerland and St Johns County Florida.

Are you facing foreclosure? Call Pam at 904-910-3516 to discuss your options.

Pam Graham with All Real Estate Options handles Jacksonville Florida short sales, Orange Park Florida short sales, Fleming Island Florida Short sales, Middleburg Florida short sales, Green Cove Springs Florida short sales, St Johns County Florida short sales, Ponte Vedra Florida short sales, St Augustine short sales, Palm Valley short sales, Duval County Florida short sales and Clay County Florida short sales.

 

Copyright © 2012 www.pamgraham.com | All Rights Reserved

 

Mortgage Assistance Relief Services Disclosure

ALL Real Estate Options is not associated with the government and our services have not been approved by the government or your Lender. If you stop paying your mortgage you could lose your home and damage your credit. Your Lender may not agree to the change of your loan and/or a Short Sale.With a Short Sale, there are no guarantees offered and we cannot provide legal advice. Seek legal advice.

Posted by

Comments (6)

Jenn Neumann Deer
RE/MAX Southern Shores - Surfside Beach, SC
Surfside Beach Real Estate

Some very good points are made in this post - just because you CAN buy, does not mean you are financially ready or stable enough to buy.  I am all for homeownership as long as it is done in an informed, responsible manner.

Apr 13, 2011 01:22 PM
Jerry Newman
Brown Realty, 210-789-4216, - San Antonio, TX
Texas REALTOR, San Antonio Military Relocation

Hello Anna, Thanks for re-posting this blog. I missed it earlier, and these are certainly four good reasons why any buyer should wait to purchase that new home.

Apr 13, 2011 01:53 PM
Karen Baker
Sunset Beach and Beyond Realty - Sunset Beach, NC
Professional Help with Rapid Responses...

Anna ~ Well those are four reasons you certainlt should not buy right now in Phoenix, Arizonia!!

Thanks for visiting my Facebook page!!  Did I mention we have relatives in Phoenix??

Apr 13, 2011 02:27 PM
Dave Halpern
Dave Halpern Real Estate Agent, Inc., Louisville, KY (502) 664-7827 - Louisville, KY
Louisville Short Sale Expert

I agree whole heartedly with the thesis of Pam's post. Thanks for reblogging this truth even if it is unpopular.

Selling costs could easily be 7% to 10% of the value of the house. If you get a 100% loan you are 7% to 10% underwater the second the ink dries on the deed and on the mortgage. In a stagnating or declining market you will have to bring the 7% to 10% out of pocket if you need to sell within 2 to 3 years.

Yes there is principal paydown, but that may be offset by some costs of sprucing up or by your moving costs.

Yes you benefited from mortgage interest deduction, but unless you used it to pay down your principal, you still have to bring cash to closing to sell your way out of the house.

 

Apr 13, 2011 02:49 PM
Pam Graham
All Real Estate Options - Jacksonville, FL
Jacksonville, Clay & St Johns Counties

Anna- Thank you for the re-blog, I really appreciate that you thought is was worthy of re-blogging! :)

Apr 19, 2011 03:35 AM