The Media Has Not Told You The Truth

As a potential first home buyer, you deserve to know what mortgage options are available so that you can make an informed decision.  The FHA (Federal Housing Authority) offers great programs. The following list details some important facts. 

1.  You can qualify for a mortgage with 3.5% down (FHA) - most economists and the press, certainly not industry experts, are telling you need a 10-20% down payment.  NOT TRUE!

2.  You can qualify with a 580 credit score (FHA) - again, those ill-informed sources say 700+ scores. NOT TRUE!

3.  You will receive a $7500 tax credit as a first home buyer - currently disclosed as an interest free loan that may be forgiven, but it is in the stimulus package to be approved as a full credit with no repayment.

4.  Your down payment can be gifted (FHA) - a family member (parent, grandparent, etc.) can gift you the money.

5.  The seller can pay up to 6% in concessions - of the sales price in points, closing costs, pre-paids,  etc.

6.  No Money Down - is achieved by obtaining an FHA loan with 3.5% down (gifted), seller paid closing costs.

7.  You can get a 30 year fixed rate at 5% (January 15) - rates change constantly and could go up.

8.  The FHA mortgage is assumable - when you sell your home, the buyer can take over the low payments which may increase the value substantially if the rates have gone up.

9.  The FHA $7500 tax credit for first home buyers expires on June 30, 2009 - take advantage of a tax credit that is available to you.

10, Obtain credit approval from an experienced FHA lender- meet your lender in person and obtain your good faith estimate and approval in writing.  Don't let Internet mortgage brokers mislead you.  It is critical to be approved so you are ready to react to good market values.

This is the Time to Buy

Interest rates are at historic lows, price reductions in housing values are down 10-35%, and a $7500 tax credit are three of the major reasons that buying a home is more affordable and offers exceptional values.  If you considered buying a home for $300,000 a year ago, today's relative value is $230,000 combining the drop in price and interest rates (based on 10% drop in value).  In some markets the relative value is down to $150,000.