First time home buyer info

richiemcfly

richiemcfly

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What's up NT?

I graduated college a few years ago and I'm currently in the process of planning/saving to buy my first home.

I'm planning on talking to family members then eventually a loan officer and realtor. But I'd figure i'll go ahead and ask NT too
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What's the preferred amount of down payment I need?
Credit Score?
And any other essential information that will be helpful

Thanks in advance
 
theres several routes you can take.  Of course the more you have down the less your loan can be.  First I would focus on having a steady job and securing a good credit score by not going HAM at the mall.  Iam 25, Iam in the process of buying a home and I'am going to give a down payment close to 25% of 300k.  I have been saving for a while and decided to go for it.  There's several other loan plans like FHA which allows you to give as low as 3.5% down of the purchase price.  I ran my score and it was above 700.  Depending on your score, your lender may have a harder time with giving you a big sum of $.  Build your credit, start saving and check out a lot of properties.
hope this helps

-UNDFT-
 
Yea last time I ran my credit score it was slightly above 700. In terms of a down payment I'm shooting for about 15% of the price of the home

I have a pretty stable job
 
how much is the home?  Always try and negotiate closing cost for the seller to take care of.  Make sure that whoever your agent is explains everything to you without rolling his/her eyes whenever you have a question.  i dropped 2 agents , they were def not a huge help.  Good luck man
-UNDFT-
 
the home is about 250k

not bad for sacramento esp since it was hit hard during the collapse of the housing market
 
20% down payment is recommended, but you may want to make a smaller down payment and keep your cash for a emergency home repair fund.  (A quality replacement for a central air/heating unit could cost $5K-$15K)
You'll want your mortgage payment to be no more than 30% of your total take home income each month.
If this is a new build, take a look at the homes that have been built but haven't sold.  Builders must sell these in order to free up funds to continue building other homes.  Negotiate everything...you should be able to get all upgrades at no extra cost if you have enough patience to wait the builders out.
If this is a home that an owner has for sale, make sure that your real estate agent finds out why the home is for sale.  Finding out information the current owner's job transfer or divorce can give you huge leverage in negotiating a price.
Every contract should be signed contingent on a home inspection.

Other than that, enjoy the experience.  Congrats OP.
 
If your income does not qualify makes no difference what your putting as down payment.you will have to show you have at least 3 to 6 months reserves in your bank account.
 
It looks like just about most of your questions were answered already. Just to recap...

For a FHA loan, you're looking at a 3.5% down payment with monthly PMI until you hit 80% loan-to-value (20% equity). Upfront PMI just went up to 1.75% from 1% and monthly PMI rose 0.1%. HUD is also rolling out new FHA loan guidelines regarding dispute and collection accounts (you'll have to talk to your lender about this, as I don't really fully understand the guidelines). Obviously you would ideally want to have at least 20% for a down payment to avoid having to pay the PMI, but that's somewhat unrealistic in most cases.

I believe most of the lenders I've worked with have wanted a credit score of around 700.

Don't be afraid to shop around for the best rate. I would suggest avoiding using one of the big banks and trying to find a mortgage broker or mortgage banker if you can. You'll get much better service and most likely a lot quicker turnaround.

I'm not familiar with the differences in Texas real estate laws and California real estate laws, so I'll avoid talking about inspections, contracts, etc.

I can send you some of my informational materials (I'm a Realtor in Texas), but again, I'm not sure if there will be anything in there that varies between Texas and California real estate laws.

If you're not already working with an agent, I'd be happy to help you find/refer you to one of our agents up there in Sacramento (Keller Williams).
 
Originally Posted by tmay407

It looks like just about most of your questions were answered already. Just to recap...

For a FHA loan, you're looking at a 3.5% down payment with monthly PMI until you hit 80% loan-to-value (20% equity). Upfront PMI just went up to 1.75% from 1% and monthly PMI rose 0.1%. HUD is also rolling out new FHA loan guidelines regarding dispute and collection accounts (you'll have to talk to your lender about this, as I don't really fully understand the guidelines). Obviously you would ideally want to have at least 20% for a down payment to avoid having to pay the PMI, but that's somewhat unrealistic in most cases.

I believe most of the lenders I've worked with have wanted a credit score of around 700.

Don't be afraid to shop around for the best rate. I would suggest avoiding using one of the big banks and trying to find a mortgage broker or mortgage banker if you can. You'll get much better service and most likely a lot quicker turnaround.

I'm not familiar with the differences in Texas real estate laws and California real estate laws, so I'll avoid talking about inspections, contracts, etc.

I can send you some of my informational materials (I'm a Realtor in Texas), but again, I'm not sure if there will be anything in there that varies between Texas and California real estate laws.

If you're not already working with an agent, I'd be happy to help you find/refer you to one of our agents up there in Sacramento (Keller Williams).
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That is incorrect. The term is mip for FHA loans not pmi. Also it will not drop after 20% it's a mandatory five years.
 
Originally Posted by tim teufel

That is incorrect. The term is mip for FHA loans not pmi. Also it will not drop after 20% it's a mandatory five years.
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Yea, you're right. Thanks for fixing that. Got to typing too fast and started mixing and matching different things
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And that's why I try not to get too involved in the money/loan side of things with my clients
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With 15% down, if he went with a 15 year mortgage he could have the MIP canceled when the LTV hits 78%, but a 15-year might be too much strain financially.
 
Sacramento has same great areas and beautiful homes.  250k is definitely not bad.  I'am in Napa and it's hard to come accross a good deal.  I'am in the works with this one home that was built in 2006, and needs nothing really.  I would personally replace all the flooring .  That's gonna run me about 2800 (3 bed, 2.5 bath, 2 story, 2 living rooms) and that will be an investment and will be an easier sell in the future if I ever want to move forward.  It's just me btw,  I don't need that much space but hey, YOLO.


-UNDFT-
 
There are a lot of incentives for first time home buyers. What was said about is true, but it would be good to first do your research first. You don't need to down that much as a first time home buyer, but please keep in mind what your TOTAL COST IS for the home. Sure, you're financing it, but you'll have a lot of principal to pay off, along w/ the 'INTEREST'. A lot of people neglect this aspect and end up financing their homes for a LONG LONG TIME, and over paying for it.

I've heard that it's a lot easier to get loans for 'residentials' as oppossed to condos though, but sac town is filled with houses right?

Either way, the most important part is to have cash/liquidity, and to have a good credit history, and income.

I would save about 30-35% down wth the cushion being a safeguard. It just makes sense, other wise you are taking on risk.

- - -

We haven't even talked about the home inspection part!
 
question for the Realtor or anyone who has the answer. Im currently getting ready to start looking for a co-op in NY and i know the first time home buyer incentives only apply to condos and houses but would if i were to purchase a co-op would i use my "first time"?

And i met with a Realtor and they told me do use BOA for my loan even though me and my girlfriend both use them and have a decent reputation with them. an anyone explain why it is a bad idea to use them or is it just that there are better options
 
Originally Posted by Slicknick951

question for the Realtor or anyone who has the answer. Im currently getting ready to start looking for a co-op in NY and i know the first time home buyer incentives only apply to condos and houses but would if i were to purchase a co-op would i use my "first time"?

And i met with a Realtor and they told me do use BOA for my loan even though me and my girlfriend both use them and have a decent reputation with them. an anyone explain why it is a bad idea to use them or is it just that there are better options
Click to expand...
im a mortgage banker and i stay away from co ops. they are a nightmare to deal with
 
Originally Posted by tim teufel

Originally Posted by Slicknick951

question for the Realtor or anyone who has the answer. Im currently getting ready to start looking for a co-op in NY and i know the first time home buyer incentives only apply to condos and houses but would if i were to purchase a co-op would i use my "first time"?

And i met with a Realtor and they told me do use BOA for my loan even though me and my girlfriend both use them and have a decent reputation with them. an anyone explain why it is a bad idea to use them or is it just that there are better options
Click to expand...
im a mortgage banker and i stay away from co ops. they are a nightmare to deal with
Click to expand...

Can you elaborate a little more? Any info would be appreciated 
 
unless you're planning to put down 20% i'd say  do the 3.5% minimum. You can always make "double payments" which are like 1/16 of your total mortgage payment anyway. This was you have extra cash for this that suddenly come up, renovate, fully furnish, or travel. If the value or your home starts to depreciate you've also vested less cash. Having extra cash upfront to spread out over the years is better than dropping your monthly payment by like $120 or whatever the difference may be. FHA all the way!

SN: look for programs in your state like "Good Neighbor Next Door" or HUD grants depending on where your buying. Ask your realtor or local officials. There is always a sweet program out there that no one knows about. Good luck
 
You should hop in a first time home buyers class they''ll give you a better loan rate also try to go through the credit union and I'd say put down about 10% and if you can't afford that you shouldn't or maybe are not ready to buy a home
 
If you're considering buying a home, there are several things to consider outside of the mortgage side of things. First, pay off all your debts first. This will help you save up faster for your down payment and will allow more of your disposable income to go towards your mortgage once the time comes. Secondly, make sure you have a 3-6 month emergency fund (outside of what you save for the mortgage). That way if something does come up, you won't have to start from scratch.

On the mortgage side, whatever you have to do, put down 20% on the home. You'll avoid MI on your payments for 5 years which will save you about $10,000 on a $250K property over the life (not to mention the interest you won't be paying on the additional loan amount you didn't take out).
 
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