What's needed to bolster the economy is not more government help. It's genuine consumer confidence. Yes, unemployment is close to 10% in some areas, but that means 90% of able workers are employed. If a person is employed and has a stable job, this is the perfect environment to look for wealth-building opportunities. The market has many bargains, and real estate has not had such value in a long time. The consumer needs to be thinking about purchases that will appreciate over the years and not look for bargains on things that lose their value over time.
The major hurdle is financing. There are times when a buyer is qualified, pre-approved and even gets approved for a loan for a specific property, but at closing the lender refuses to fund the loan. The lenders are suffering from their own irresponsibility and are now afraid to loan money to individuals more responsible than they.
There a few options to avoid nervous underwriters. FHA and VA loans are still doing well. local credit unions have money to lend and many regional banks that never got into the sub-prime game are stable, growing and willing to do business with qualified buyers. You also have some influence in getting that good loan.
Good financial advisers recommend:
-Having your debt under control. Have low balances and pay them off monthly, and own cars you can pay off.
-Having three to six months' living expenses in an emergency fund.
-Getting a fifteen-year mortgage.
-Financing no more than 80-percent of the value of your home, either with a down payment, equity in the home or a combination of both.
-Keeping your mortgage payments to no more than 25-percent of your take home pay.
You may be able to buy more home by getting more creative or stretching your finances to the limits (others have done that in recent years and look where they are now!). But not having enough money left over to enjoy your home after you move in ruins the whole home-owning experience. Trust me, I've been there.
Help is needed to know where the opportunities are and and how to find them. Consider taking advantage of the current value in the real estate market, but do it wisely.