Thinking of buying a home in the Prescott, Arizona area?  Perhaps one of the foreclosed or REO homes? 

Now is the time with the incredible decline in home prices and historically low interest rates!  Are you prepared to move forward? 

Before you answer yes, have you consulted a lender? 

If you are one of the 30% or so who do, congratulations!  Many others rush out to seize the opportunity and forget a vital step. 

Why is it so important?  Well, ask any lender and they will tell you how radically different the loan process is compared to three years ago.  

Gone are all the non-qualifying programs along with stated income loans for self-employed borrowers.  Higher credit scores are required and additional monies for down payments particularly for second homes and investment properties.  With Fannie Mae and Freddie Mac virtually being the only source for mortgages, they have enacted risked based fees for anyone possessing a credit score below 720.  With advanced planning you may be able to avoid these fees by ensuring your credit score does not cause you to pay  addtional monies. 

So don’t be insulted if your Realtor asks that you talk with a lender before being shown properties.  After all, nothing is as embarassing as finding that special home and, as your Realtor waits to prepare a contract, you are told that you do not qualify.  On the bright side, with these low rates, you may qualify for more than you thought.  Happy house hunting! 

For more information about the current financing market or to get pre-approved, call
Tom 928-775-9330 or email him at tomhenichek@cableone.net.

Fico Scores/Reports

 On Wednesday, the Federal Reserve agreed to purchase a large amount of mortgage securities since investors are sitting on the sidelines and not actively participating in these securities. 

This action spiked a short term rally in the stock and bond markets with the bond market seeing its largest yield decline since 1962.  Interest rates declined .25% but we are not sure how long this exuberance will last. 
 

Many bond experts are predicting that since the government is backing these securities, interest rates will continue to decline providing home buyers a significant savings.   
 

Keep your eye on the market and stay in touch – this could be the time for make that purchase!

For more information about the current financing market or to get pre-approved, call
Tom 928-775-9330 or email him at tomhenichek@cableone.net.

Fico Scores/Reports

Search for Foreclosed Properties in Prescott

Many of you are familiar with the $7,500 tax credit if you purchased a home after April 8, 2008 and before July 1, 2009.  Essentially, the government has given you an interest free loan for purchasing this home if you are not a high-income tax payer.  This credit must be paid back within a 15 year period.  If you sell the house prior to that time, the remainder is due in the year of the sale.
 

Another new program has been released by the IRS for those purchasing a home before December 1, 2009.  This program allows for up to $8,000 tax credit ($4,000 for married filing separately) which does not have to be paid back as long as you occupy the home for 36 months.  Again, this benefit begins to phase out for high-income earners ($75,000 or $150,000 for joint filers).  If you purchased a home on or before December 31, 2008, you are not eligible for this new program.

 This program is only available to first time homebuyers which includes those who have owned a home previously but not within the past 3 years pf the date of purchase.  Simply fill out IRS Form 5405 to claim this credit.

For more information about the current financing market or to get pre-approved, call
Tom 928-775-9330 or email him at tomhenichek@cableone.net.

Fico Scores/Reports

Get a better interest rate

Well, for starters we have lower prices than anytime in the recent past, great interest rates and the possibility of seller concessions.  Every product today has at least a guarantee of 3% seller concessions.  So, if the seller will or cannot lower their selling price, they may allow some concessions in order to sell their home.

This is only one of the reasons why if you are thinking of purchasing a home, you should talk over your situation with a lender.  In today’s cash poor society, your lender can assist in this process.

 After all, if you need assistance with your closing costs, your lender will be the first to advocate for you.  The best way to document this is to come up with a figure for the seller’s contributions.

The 3% is based on the loan amount and if the contract states that the amount is for closing costs, some lenders may not allow the contribution for prepaid items i.e. interest, home insurance and property taxes.  With a specific amount stated and contributed, that money can be put toward prepaid items or be used to buy down your interest rate. 

Today, the spread between interest rates is lower than at any time in the past and this option may be worth considering.

The credit system is ripe for errors and something from your past may still be lurking on your report even though you thought it was corrected.  With the number of foreclosures, credit reports are weighed heavier than at any time in our history.  Being pre-approved for a purchase will cost you nothing but time and will put your mind at ease when the time arrives for you to make your move.

For more information about the current financing market or to get pre-approved, call
Tom 928-775-9330 or email him at tomhenichek@cableone.net.

Fico Scores/Reports