Wednesday, March 17, 2010

Buying a house--2010 style

I watch “House Hunters” and “Property Virgins” on HGTV all the time and see these young people squinting at gorgeous bathrooms in half-million dollar homes and saying, “The tile will have to go.”

Is the recession a joke—is it over?

People will still quit a job and people will still buy a home. It happens.

Ilyce Glink, Tribune Media Services, says housing is still on life support. But the $8K stimulus wad for first-time home buyers is still good until the end of June. I hear you need to jump through flaming hoops, but it’s there.

You could even somehow get a $6,500 credit if you’ve lived in the home you’re selling for five yrs.

More than a quarter of Americans, though, are basically renting—their homes are worth less than they owe. It may be 20 yrs before they regain the value they supposedly had.

The government lending organizations are borrowing like mad to stay in the loan business. Freddie Mac, Fannie May, and FHA are making 90% of the loans—and they are shaky.

Investors bought 40% of the homes last year.

On the only bright side—interest is low. Just try to get lower interest with a loan remod, though--good luck.

If you are taking the plunge, get your finances in order first. You need a credit score above 760.

Know how much you can afford to spend. You will need a ton of documentation to show you can put the monthly. A ton!

Be sure the neighborhood is not dotted with foreclosures.

Interview at least three brokers. Get the best. Ask how many transactions they have closed and who their customer is.

Read everything! A few little problems have arisen from people who just initialed and signed, initialed and signed.

As for buying a house in short sale—I learned from HGTV that the bank can take months to move or never respond at all. At least the house hunting shows have that right.

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