We just read an article from a Realtor® magazine that is encouraging for Realtors®, sellers, and buyers in Virginia.
The fall of the subprime market has caused lenders to come up with strict guidelines for buyers to qualify to purchase a home using a conventional mortgage. Along with the Earnest Money Deposit which is required and is 3% of the sales price of the home, a down payment of 3% is also required. A home $250,000 would require $7500 Earnest Money Deposit and $7500 as a down payment Earnest Money Deposit shows the seller, listing agent and broker that the buyer is very serious about purchasing a home. The cost of closing is approx $12,000. Thus, you need a good credit score which is higher than required for the last few years. Our question is who has $30,000 saved to purchase a home? If you are living from paycheck to paycheck where is this money going to come from? You are not a bad person or some reckless individual (as some would have you to think) for living from paycheck to paycheck, a lot of us are living the very same way.
There is a program for First-Time home buyers who live in Virginia, to help them to purchase a home. For a while the program was not available, but has now been revamped and ready to help. It is called (VHDA)
Virginia Housing Development Authority. They had to get rid of the FlexAlt and Step loans which enabled First-Time home buyers who fell below the accepted credit score to purchase homes through the subprime market.
Don't feel bad as some folks believe that you are pretty much a criminal if you have less than stellar credit score, it happens good people like you are out there struggling. Some mistakes could have been made when first coming out of high school. All of a sudden all of thees credit card applications start flying in. As that young person, you have your first job, you can now go out a buy a car. Oh, yes, you also receive all of those car dealer incentives to come and get you a car that has just come out on the market. You go and do all of these things not knowing when those bills start pouring in and you don't have the money to pay them all, your credit takes a big hit. You had no idea this could happen and now years later when you try to purchase a home, you can't because of your low credit score.
Like a number of programs to help locally to purchase a home already required First-Time home buyers to attend a home buying class before these buyers could receive help. The VHDA now requires that the First-Time home buyer must attend Intro to Homeownership class. Don't give up First-Time home buyers, Virginia has programs to help you.
Amazingly as we have stated earlier in our blogs, the housing market in Virginia is different than other places. People are buying homes and many listing agents have a number of offers on one home, especially so on foreclosed homes. Virginia's economy is robust. Compared with other states in the country, Virginia's economy is among the strongest. There is a low unemployment rate which is supported by the Virginian companies that support the Federal Government. There is also the fact that Virginia's foreclosure rate is half that of the nation's rate of foreclosures. While the number of foreclosures across the nation have risen it is clear that Virginia's housing market has not risen as high.
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