We are looking at buying our first home. We really don't know much at all about buying a house but we feel like now would be a good time to take advantage of the housing market and the stimulus money the government is giving out. We talked to a loan officer and he said that we would qualify for an RDA loan. Does anyone have any information about RDA loans? He also said that the interest rate will depend on the bank. I'm curious, do we need to go through a third party company to apply for a loan, or is it better to apply through the actual bank? He also told us that if we "close" in October (which is what we would be shooting for), we wouldn't have to make our first mortgage payment until December. Is that right? He also told us that we wouldn't have any closing costs, because with the way the market is right now, the seller pays all closing costs (which he said included paying him and a real estate agent, etc.) We haven't applied for a loan yet but we think we would only qualify for about $130,000. He said our mortgage payment would only be around $750 (rough estimate). We don't have a down payment at all, but we also don't have any debt. Our income is about $2,400 a month.
Ugh....I just feel totally confused and overwhelmed by all of this stuff. HELP please!!!
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It's true you wouldn't have a payment until December because your November house payment would be included in the loan. If you ever refinance, you also get to skip a month, even though you don't really. (It just means the money doesn't come out of your pocket right then, it's included in the loan).
The amount he quoted you for the mortgage, could just be P&I (principle and interest). Then, you have to add on insurance, taxes, escrow, etc., which increases the amount you owe each month.
Hope that helps answer a few of your questions.
RDA, I assume you are talking about a Rural Development Authority loan.
We recently bought a house and that was one of our options.If you can find a good house in a Rural area by you it's a great program. The goverment will cover your Mortgage Insurance, which on a traditional loan you have to fork out like up to twenty percent of the loan, just so they know you will pay your mortgage. We bought our house in April and didnt make a payment until June I think. I would go to a bank that way you arent paying a middle man. get a real estate agent and dont sign anything until you are ready.
Do some research on diffrent loans and go see what you really can get pre-approved for. Dont stress it's really not as bad as most people make it seem.
Yeah buying anything through a bank etc can be like that. My thought for you would to look into ' rent to own ' That would sound a little better choice to me.
UnderstandingBookofMormon
i was in your situation 7 years ago. We qualified for around 130k but instead bought a house for
60k. We paid extra every month and then 5 years later, We were able to put down 35k cash on the new house. house and land 175,000, loan 140k and now worth around 250k. 5 years later our income was up as well and put us in a better position to afford more house. Owning a house also is different in the fact that it doesn't stop with your pmt and taxes. pipes clogged-call a plumber, ac out- call ac guy. it's all your, no maintanance like the rental.
You can not afford it. With zero down, don't do it, don't do it, don't do it. You need to have savings built up to pay for the little things that come up along the say. In the last year we have had several silly things that have come up and we can't call the land lord. It can literally nickel and dime you to death. If you do buy a house, DO NOT buy what the bank qualifies you for. If you do, you will be house poor and will have no money left for the fun things.
It's free to use a real esate agent to help you buy a house, so your first step would be to find one. He/she will be able to answer all of your questions and, most importantly, take the stress off of you by explaining every step of the process and helping you through it all. And you're right, now is a great time to buy as long as you can stay in the house for a couple of years. Good luck - I promise it's not as daunting as it seems.
10:49 - Real estate agents are not free. Their fee is included in the closing costs. Their fees average anywhere from 1% to 6% (or more) of the cost of the home. In some situations, the sellers will pay closing costs, but not always.
OP here.
Thanks for the info everyone. We would know before going through with it if the sellers were paying the closing costs, right?
Also, it seems that in our price range all that is really available are MAJOR fixer-uppers, modular homes, OR beautiful new condos/townhomes. Does anyone know if townhomes have good resale value? Is it a bad idea to start with a townhome?
When you make your offer, you would include the caveat that the sellers pay your portion of the closing costs. Or, they may offer as part of the deal. We needed to sell our house quick (for $188,000), so we paid all the closing costs (about $4800).
This is 10:49. Just to clarify, I didn't say that real estate agents are free, I said that it's free to use one to help you BUY a house. The seller pays the commission of both their agent and the buyer's agent (not considered closing costs), so the buyer pays them nothing. Whether the seller pays your closing costs or not all depends on what you negotiate in the contract, which your agent will take care of. If you happen to be in the Salt Lake/Orem/Provo area I'd love to help you out (I'm an agent). Email me at heatherc925@gmail.com).
Whether a townhome has a good resale value is entirely reliant upon where you are buying. I have a sister who bought a town house in one area about 8 years ago and moved 3 years later and sold it for double what she paid. Talk about lucky. Then I have a friend who barely broke even with her townhouse last year in a different area.
me and my husband just bought a house for around 125,000, but our house payments are 850.00 monthly. that does include the mortgage insurance taxes etc. but if the government pays your mortgage insurance that would be awesome it will save you about 60-70 bucks a month.
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