Story after story talks about how homeowners, who are attempting to modify their adjustable interest rate home loans to lower their payments, are now watching their monthly payments skyrocket.
Please don't get an adjustable rate mortgage (A.R.M.)!
I just read a story about a couple in AZ with a $550,000 home and they are trying to get a loan modification, because their interest rate is going to adjust (UP) to over $1,000 more per month. Most Americans cannot afford a jump in monthly payment like that.
When you are looking to purchase a home, only apply for a fixed interest rate mortgage. An ARM will only hurt you in the long run. If you have to get an ARM to buy a home, don't buy it! ARMs are only a viable option for very few homeowners, yet during the years of 2003 - 2007 in a hot seller's market, many people got ARMs, because that was the only way to afford the home they wanted.
Now I'm not here to place blame. There's enough to go around for everyone, but the fact of the matter is if you can't comfortably qualify for a 30 year fixed rate mortgage on a home that you want, then you need to move down in price. The Financial Peace University Guy, Dave Ramsey, even talks about only taking out a 15 year mortgage.
You also need to remember that your total mortgage payment of PITI (principal, interest, property taxes & homeowners insurance) will go up from time to time, because even though your principal and interest are fixed, your taxes & insurance will increase over time.
So, when deciding on how much home you want to buy, make sure that you review your housing goals, stay within a comfort range for your monthly payment and don't buy a home that will keep you home all the time, because you won't have any money left over to enjoy life.
At your service,
Dan
What questions do you have? I'll gladly answer them at: dan@danweis.com.
Are you a first-time home buyer? Attend our Free First-Time Home & Condo Buyer Class. For details and upcoming class dates, go to: http://www.HomeBuyingClass.com
Are you ready to find your dream home? Contact me for a Free Home Buyer Consultation at: (513) 615-1890 or dan@danweis.com No cost...No obligation...No sales pressure!
Are you planning to buy a home in Cincinnati, Ohio in the near future?
If so, when viewing properties, make sure you do a double take at the property tax amount. You need to confirm that the tax bill amount is accurate with your local county auditor's web site.
Then you need to take it one step further and check to see if a Homestead Exemption discount has been deducted from the tax bill amount. (In the state of Ohio, a person 65 years of age or older may qualify for the discount.) You see, Multiple Listing Service (MLS) property sheets can show the wrong tax amount. If the listing agent didn't check to see if the sellers qualifies for the Homestead Exemption discount, they may enter the lower tax figure on the MLS sheet. Then you assume that's the correct tax amount. In 6 months, when the next tax bill comes out and it's several hundred dollars higher, you get very upset.
So when you are deciding on a property to purchase and you want to figure out what the monthly payment will be, make sure you find out the correct annual tax amount.
2009 is a great time to buy - Lots of Properties For Sale...Low Interest Rates...Favorable Pricing!
Are you a first-time home buyer? Attend our Free Home & Condo Buyer Tele-Class. For details and upcoming class dates, go to: http://www.HomeBuyingClass.com
Are you ready to find your dream home? Contact me for a Free Home Buyer Consultation at: (513) 615-1890 or dan@danweis.com No cost...No obligation...No sales pressure!
If you're planning to purchase a lender-owned property, be aware of the additional fees you'll end up paying.
As we approach the season of overnight temperatures often reaching 32 degrees and below, one of the things consumers need to be aware of when they make an offer on a lender's foreclosed property is to read the fine print. There are many listings that now state in the remarks that the "BUYER" is responsible, at their own expense, of having the property's plumbing de-winterized for their inspections and then re-winterizing it when the inspections are completed. I've heard cost estimates of $250 - $300 for that service. Consumers should also make sure that all of the utilities have been turned back on, so that the inspections can be finished in a timely fashion. Don't assume it's been done by the other party...double check by calling the utility company.
This is just one of the 'unknowing' charges you may end up paying for when buying a foreclosure property. There are a lot of great values in the market right now. If you're interested in taking advantage of this buyer's market, I'd love the opportunity to help you find one of these properties. Just contact me at dan@danweis.com or 513-615-1890.
Are you a first-time home buyer? Attend our Free Home & Condo Buyer Tele-Class. For details and upcoming class dates, go to: http://www.HomeBuyingClass.com
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