Archive for November, 2009

Are You Ready To Buy a House?

So, you want to buy a house? Of course! It’s the American dream. You can paint the walls the colors you like. You can plant what you like in your backyard. Maybe you’d like a pool in your backyard. You can remodel your house to show off your style, to make it your own, to make it a comfortable and comforting place for your lifestyle. You can make it a home.

Okay, what’s the first step? Well, let’s find out how much house you can buy. To do that you need to talk to a lender and get pre-qualified. You can do that over the phone. But is that good enough to start shopping? Not any more. These days, now that lenders have suffering in their history, they aren’t as lenient or as open minded as they used to be. One Realtor said recently, speaking of that bygone era, “all you needed was to be able to fog a mirror to get a loan.” Those days may be gone, but the good news is that lenders are still in business to make money and they do that by selling loans.

Ask a lender to get you pre-approved for a loan. This entails enabling the lender to request and look at your credit report, and learn your FICO scores. You will also fill out a loan application form. He or she will ask you to bring in a couple recent pay stubs, bank statements, and tax returns. That lender now has a pretty good idea about your income, your debt, and your payment habits. Ask the lender to give you a pre-approval letter. Now you’re ready to call a Realtor and start shopping for your new home!

I’m Pre-Approved! Where’s My House?

Mr. and Mrs. First-Time Homebuyer have been out looking at homes, and they found one they like in their price range.  Okay, let’s write a contract to purchase that home.  How exciting!  “Honey, where will we put the big screen TV?”  Several days go by, and still no word from their Realtor.  “She said she would call when she had news for us.  How can there be no news?” 

“That house was pretty trashed; who would want it besides us?  Who has the vision we have for making improvements to that house?”  Well, apparently a lot of people are thinking that same way.  Much of our current inventory, especially at entry-level price range, is distressed properties.  Many have gone through the foreclosure process, and the seller, most likely a lender, realizes that many of these homes have had walls put up or removed, garages may have been converted into living quarters.  Sometimes light fixtures, stoves, faucets, even copper piping may have been removed from the property. 

 That’s part of the reason these homes are now priced so attractively.  They may be listed at several hundred thousand dollars less than they sold for three or four years ago.  We live in an area where there is great value in the land, therefore it’s not unusual to have even dozens of offers on a bargain property when it comes onto the market.  (This is why it may take a while before your agent receives news on your offer back from the seller’s agent.)  Many of these homes are being snatched up by investors, paying cash.  My advice to you is, keep writing offers.  You will win a contract!  And when you do you truly will be a winner.  Economics is cyclical, prices most certainly will come back–and there is value in that land!

Yes, It’s Time To Buy!

There has always been much demand for real estate in the Bay Area. Lots of people live here, and most of us want a place of our own. That demand for homes pushed prices up. Then, when the economy fell apart, prices came down. Several factors were involved, which resulted in short sales and foreclosures, and then the large amount of foreclosures itself became a factor. For a while buyers just sat and watched, but when they saw others buying homes at greatly discounted prices, they have come back into this area/market, looking for bargains. This is a great time to buy, especially for people who couldn’t afford to buy here before. Not only have prices come down, but interest rates are at historic lows. An unbeatable combination!