Sequim, WA

In December I personally closed on four USDA purchases here in the Sequim and Port Angeles Area.

What makes the USDA loan so attractive to homebuyers?

1. This loan requires no down payment. Some may say that homeowners need to have a little skin in the game and don’t like Zero down loans. While I do agree with this point my experience is that for many people in our area 5-10% down payment is sometimes out of reach for them; especially folks starting out or going through major life changes.

2. Compared to the FHA mortgage, USDA loans do not require Mortgage Insurance. On a $200,000 purchase price that saves you $91/month on your mortgage payment.

3. Closing costs can be seller paid or if the home appraises for more than the purchase price they can be added onto the loan and financed.

4. USDA loans also allow you to finance up to $10,000 in repairs to the home. Maybe you can only afford a $150,000 home and everything in your price range requires some kind of work.

5. Lastly, strict income and debt to income requirements. USDA loans are made to help homebuyers succeed and become long term homeowners. Careful attention is giving to your payments and the amount you qualify for so as to make sure you are not getting in over your head.

Buying a home with USDA financing is one of the best ways to purchase a home and get the lowest monthly payment. This is a true ZERO down no money out of pocket loan. Many of our residents who were priced out of the market two years ago are finding homes more affordable. Buying a home right now with historically low interest rates, lower home values, and a great loan is the beginning of solid financial future.

I hope this helps. If you have any questions or desire further information about USDA loans please email arthur@sequimhomeloans.com

Initially the first time home buyer tax credit didn’t seem like a motivational factor for residents here in Sequim and Port Angeles. However, since August, once people began to see time winding down on the tax credit; purchases began to increase quickly. For many locals who have be patient are now finding lower home prices, lower interest rates, and all this with an $8,000 credit on the horizon.

3 POINTS about the new Home Buyer tax credit that has been extended as of November 6th.

1. First time home buyer purchases between Jan. 2009 and April 30th 2010 may be eligible. If under contract by or on April 30th you have until June 30th to close on your home purchase.

2. Move up buyers may also eligible for a tax credit up to $6,500. For this you must have resided in your current residence for five out of the last eight years.

3. See this link http://www.irs.gov/pub/irs-pdf/f5405.pdf for the 2008/2009 form. It can be used if you purchased your home before and after Nov. 6th 2009. See http://www.federalhousingtaxcredit.com/ for more information.

There are unique scenarios that will disqualify you for the credit like purchasing the home from your parents. The home buyer tax credit is having a significant impact on purchases in little Ol’ Sequim, Washington. 70% of the home loans that I am currently working on are eligible for the tax credit. 40% of those are USDA Zero down purchase loans. Let me know if you have any questions.

Thank you for your positive comments.

Port Williams Beach in Sequim is a beautiful place to walk along the water's edge, and there's a public boat lunch, too.

Port Williams Beach in Sequim is a beautiful place to walk along the water's edge, and there's a public boat lunch, too.

Sequim homes are selling, but of course, we are in the slower winter months right now. We are closing in on the end of 2009, so how do monthly home sales look this year? Here's a chart showing monthly home sales comparing Sequim and Port Angeles site built homes sold in the price range of $200,000 to $500,000. This would include the vast majority of homes sold in our area.

Of course, it is no surprise that November and December are slow. These are the slow winter months when buyers have turned their attention to family and to the holiday celebrations. November through March tend to be the slower months as shown in this chart. This year sales did not perk until May, but if the economy is healthy or on the mend, we could see buyers making their move in March of 2010. We did see an unusual spurt of buyer activity in October, rather late in the year for so many buyers to make their close. The increase in sales of homes in other parts of the country, low interest rates, and the $8,000 tax credit were all factors.

Some who are planning on buying here in the spring would be wise to make their move now when they won't be bidding against so many other buyers. If there is a time of year when the buyer's negotiating power is at its highest, that time is now.