For those of you in California....especailly those buyers looking in the Carlsbad area.
Because of the slower market and so many buyers sitting on the fence, I thought it might be helpful to see if I could drum up more business with First Time Buyers (it's tough for many people, let alone first time buyers, to buy in our area of Southern California if you want a detached home since there is not much under $500K, but lots of condo options in some communities).
Having worked with lots of FTHBs back East, I knew a big issue is the downpayment and/or closing costs, and that many can afford the monthly payments. A recent seminar focussed on the below market interest rate mortgage loans available through CalHFA that can enable a qualified FTHB (someone who has not owned a home in 3 years) to buy with little or no money down.
But there are also programs that provide second and third loans for downpayment assistance (up to 3% of the purchase price) and closing costs. These are deferred interest loans, so while they acrrue interest you do not have to pay it until the home is sold. There are guidelines for low and moderate income individuals and families but these are actually pretty generous, and the guidelines may vary if someone is buying in a targeted vs. a non-targeted area. Yes, it does mean that in many communities, because of high prices, that these buyers will need to settle for a condo, but it gets them into the market now, at a time when many fear they cannot buy. I know of a recent purchaser who was able to buy a detached 3 BR home in the $500s with no money down and the seller paid the closing costs.
I suspect there will still be many FTHBs fearful of taking the plunge but CalHFA provides some options for those who seriously want to own their first home. These programs are only available through approved lenders. And there may be similar types of programs in other states. Check it out.
UPDATE: August 29, 2007 - be sure to check with a reliable and qualified mortgage broker. Due to the changes in the mortgage industry in the last couple of months some of these programs may have changed or might not be so readily available.
