You May Be Approved But Your Property May Not!!
I recently ran into a situation where my clients were approved for 100% financing but ran into trouble once they found a property. The home that we found and negotiated for was in an area that had been changed to a "Declining Market" mid way through our negotiations. This meant that the program that they were in would not allow them to purchase this property at 100% financing. The loan officer was able to find another program to accept the property but we still were not done.
Even though the bank had approved my clients and the property for the loan, the mortgage insurance company still had to approve the property before we could breathe easy. It took a very possitive appraisal to get the deal done and fortunately their were several comps within the last 1-3 months to use. Everything got done and they will be closing this week!!!.
I share this not to scare you but to make you realize that we are returning to the time when you needed 5% to put down on a property in order to buy it. This is not a bad thing!!! It may slow things down for short time but we really need to start thinking in a more fiscally responsible way.
There are some tremendous opportunities out there for people starting out to get their foot in the door without having to find themselves in a foreclosure situation. It is very reasonable to believe that you can get into a 1 bedroom condo at or slightly above what it costs to rent in today's market. When you take into consideration the tax benefits and the fact that a portion of your montly payment is going towards building equity it is a no- brainer.
For those who have a little more to put down, buying a 2 unit home and using the rent to pay down your mortgage is a time tested way of building equity quickly. With the number of foreclosures today there is a need for good rental properties and most condo converters want three or more units to make it worth their while. Combine these factors with the large inventory of 2 unit homes on the market and you have some real buying power.
Owning your home is not only a matter of pride but it simply makes sense financially. Save your money, get the down payment and get into this market while the buyers are still in charge!
Contact me for a list of properties in your desired City/Towns
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