Summer, 2009 is passing, and as fall approaches, one of best the deals first time homebuyers have had it a long time is winding down. As currently written, the $8,000 first time homebuyer credit is set to expire November 30, 2009. That does not mean you have signed a sales contract that day; it means that by that date, you must have closed on the property. The moving truck is on the way; you'll be having Christmas in your new house.
Given that it takes a little longer to get a loan and have all the paperwork completed these days, your best bet is to have your contract signed by October 1, with October 15 being your "drop dead date." Of course, if you come to the closing with a wheel barrow full of cash, your schedule might be a bit different!
So why haven't you called me or a reputable agent in your area to get the ball rolling? Mind you, I'm not trying to make you buy a home before you're ready, but a lot of times, I find that people are stuck in the inactive mode. Here's what might be on your mind:
What if the credit is renewed and made even larger?
It's true that there are a few attempts underway to expand the credit to more buyers and extend its length. If a larger credit is approved, it is likely that you would be able to claim the higher one, based on how the government handled the transition from the $7,500 credit to the $8,000 one.
If the credit is expanded to include all homebuyers, there will be more competition for existing homes. As it is now, the homes that are moving briskly on the market are the homes closer to a first time buyer's price range. With even more competition, the housing stock you might want to look at might be seriously depleted.
What if my job isn't stable? I don't want to make a commitment and then be unable to pay the mortgage?
Of course, if you are fearful of losing your job, you should be cautious. You might ask yourself how much your current rent is. Is your household a one income household or a two income one? Are you in a field where you could easily get another job in the worse scenario? Assuming that your boss is not walking down the hall toward your office with a pink slip and you don't have a concrete reason to believe that will happen, you might take the plunge if your house payment won't be much more than what you pay now.
My credit is not perfect, so I'd better wait.
In these times, lenders are stricter and may require a higher credit score than in the past. You should look at your credit report and see how you stand. Many times, when you pull your report, you will see some things that can be fixed quickly by notifying the credit bureau. By updating payments falsely reported as late, checking that your balance and credit limits are reported correctly, and getting old outdated or inaccurate information removed, you might get your score good enough to qualify for the loan. If your score isn't good enough to qualify for the best terms, you still might be able to get a loan that you can refinance later when your credit report looks better and you have built some equity in your current home.
What if prices keep dropping and I pay a few more thousand that I would need to?
No question about it, no one wants to see an item go on sale right after they've bought it! Right now, all indications are that housing process are near the bottom of their free fall. If your homes falls even a few thousand dollars, your mortgage would be pretty close to what it is now. It is better to get a home you can afford now than wait for the market to completely adjust.
My dog has fleas, my car is in the shop, or, as the Bible says, there's a lion in the street. Now is not a good time to buy!
Well, in some Southern states, there are cases where alligators turn up in residential neighborhoods. But most of these "reasons" amount to procrastination. Maybe you are hesitant to take such a big step if you have never bought a home before or if you took a break from home ownership. If your finances are right and you would like to be a homeowner, this is a great time to do so.
If the $8,000 incentive is not enough to your fears about buying a home now, it's time to talk to your agent about whether your concerns are legitimate or whether you need some encouragement to pursue your part of the American dream.
Sandy Ogburn-Sandlin and her team of agents are ready to discuss your concerns and then show you the prettiest homes in Prairieville and other parts of East Baton Rouge, Ascension, and Livingston Parish.
