First Time Home Buyer Need Help

[xCaliber]

Hi guys,

 

My wife and I are thinking to buy house and we saw one house .. house is around $420k. We are ready put down 20%. but not sure how to get best morgage rate... or next procedure ( process ). Where should I turn next ?

 

we are looking house in NJ.

 

any help will be appreciated ..

 

 

thanks,

 

xCal

[simplemod]

if you got the money to put down 20% on that much, then you should be able to just walk into any bank and get financed. and right now, interest rates are averaging less than 4% about anywhere. just watch out for ARM (adjustable rate mortgage) that shit can eat your lunch if you don't get refinanced in time.

also, if you got that much for down payment, you could just move to arkansas and buy a nice place with some land, and be paid for in full.

[little_old_man]

Yeah it's a great time to buy. As long as you have spotless credit and a high down payment, you should be able to find a reputable mortgage broker than can find you the best terms. If you walk into a bank you'll only hear about their rates and not possibly better ones that are out there.

[PigDog]

Simplemod is right, if you can put down 20%, you shouldn't have a problem getting a good loan rate. I would check with several banks or mortgage brokers before you decide. I would not advise an ARM, or adjustable rate mortgage right now. With rates where they are right now, there is no reason to go with an adjustable rate. It is too risky. Just get yourself the lowest fixed rate you can and go with it.

 

Here is a website for mortgage rates in New Jersey. You might try giving some of these a call.......oh, and at where the rates are right now, you probably don't need to pay any points to get the rate reduced further. Good Luck!

http://www.interest.com/mortgage/rates/?prods=1&loan=165000&market=1055&points=Zero&perc=20

[YellowSnow]

xCaliber,

 

Buying a home for the first time can be difficult and frustarting. Appraisal fees, closing fees, realtor fees, plat drawings, title insurance, bank escro fees....i could keep going on.

 

Yes, shop around for the best interest rates but also shop for best closing costs too. Most if not all banks charge a 1 persent loan origination fee. That's 1 percent of the loan. The Lender requires Title Insurance and you have the option to buy an Owners Policy. The Title Insurance is charged by the Title Company.

 

Also, you have the choice of which Title Company you want to close with. I would call several Title Companies to find out what their fees are. Tell them you are shopping around. Title Companies are always fighting for the biz.

 

This is a buisness of wolves and sharks. Be careful and don't always beleive what you hear.

 

Shoot me a PM and I'll give you my number and we can talk about it.

 

YellowSnow a/k/a TITLEGUY

[xCaliber]

Simplemod is right, if you can put down 20%, you shouldn't have a problem getting a good loan rate. I would check with several banks or mortgage brokers before you decide. I would not advise an ARM, or adjustable rate mortgage right now. With rates where they are right now, there is no reason to go with an adjustable rate. It is too risky. Just get yourself the lowest fixed rate you can and go with it.

 

Here is a website for mortgage rates in New Jersey. You might try giving some of these a call.......oh, and at where the rates are right now, you probably don't need to pay any points to get the rate reduced further. Good Luck!

http://www.interest....ts=Zero&perc=20

 

thanks for the reply pigdog..

 

So, when I call them for my application I ask for 0 point loan. Am I right? and try to get lowest apr possible ? Should I be asking anything else beside that? bargaining on anythin?

[xCaliber]

xCaliber,

 

Buying a home for the first time can be difficult and frustarting. Appraisal fees, closing fees, realtor fees, plat drawings, title insurance, bank escro fees....i could keep going on.

 

Yes, shop around for the best interest rates but also shop for best closing costs too. Most if not all banks charge a 1 persent loan origination fee. That's 1 percent of the loan. The Lender requires Title Insurance and you have the option to buy an Owners Policy. The Title Insurance is charged by the Title Company.

 

Also, you have the choice of which Title Company you want to close with. I would call several Title Companies to find out what their fees are. Tell them you are shopping around. Title Companies are always fighting for the biz.

 

This is a buisness of wolves and sharks. Be careful and don't always beleive what you hear.

 

Shoot me a PM and I'll give you my number and we can talk about it.

 

YellowSnow a/k/a TITLEGUY

 

 

title insuarance ..never heard of that ..I may be missed that lol...

[billyblade]

make the seller eat ALL the closing costs as part of your deal. At the price your paying, they aint making just chump change and if they are anxious to sell, they will. if you can pre approve your loan before shopping, you have a better chance of strongarming a great deal!!!! Sellers love not having to "wait and see" if you can get approved after signing a contract and putting up your earnest money.Also, at the time of closing, take the 1 year house insurance. When me and the wife bought ours, we turned it down....within 6 months needed new AC unit...no house insurance( and i'm not talking homeowners here...) and BOOOM ....5600 dollars in already in the first year! YIKES!!!

 

And like Simplemod said...NEVER go into APR. If you can afford to pay more against a fixed with no penalty, then you can reduce ammortization and come out in the long saving money. I know this much, if you a re looking at a house for 420,000, then my assumption is you arent really worried about money to begin with.

[WiZiD]

See if you can find a mortgage broker. They all charge something so shop around. Most if not all mortgage brokers know the ropes and will work for you to find the best deal. Also no matter how sweet it seems DO NOT get an adjustable interest rate. Always get a fixed rate for the life of the loan. Also mortgage brokers take a lot of the stress away from you. Well worth the extra fee and can be rolled into the loan.....

Edited July 6, 2012 by WiZiD

[little_old_man]

make the seller eat ALL the closing costs as part of your deal. At the price your paying, they aint making just chump change and if they are anxious to sell, they will. if you can pre approve your loan before shopping, you have a better chance of strongarming a great deal!!!! Sellers love not having to "wait and see" if you can get approved after signing a contract and putting up your earnest money.Also, at the time of closing, take the 1 year house insurance. When me and the wife bought ours, we turned it down....within 6 months needed new AC unit...no house insurance( and i'm not talking homeowners here...) and BOOOM ....5600 dollars in already in the first year! YIKES!!!

 

And like Simplemod said...NEVER go into APR. If you can afford to pay more against a fixed with no penalty, then you can reduce ammortization and come out in the long saving money. I know this much, if you a re looking at a house for 420,000, then my assumption is you arent really worried about money to begin with.

 

Trying to strongarm the seller depends on where you are buying and how strong the market is. Xcaliber is buying in Jersey and depending on the proximity to NYC he may be getting a deal on the house and there won't be any room for those kind of negotiations. Get too pushy with the seller and they may just tell you to bug off, especially if they aren't in a hurry to sell.

 

I live north of San Francisco and the market is pretty strong here right now. My parents are both in their late 70's and their house isn't even on the market. Last week a realtor knocked on their door and said their client wants to buy their house, so they're thinking of moving to a smaller place and the offer was great. South of where I am in Silicon Valley people are putting houses on the market and they're getting bid way up from the asking price.

 

If you have a good down payment through savings and family, and you can qualify for a loan of around $300,000, you can have monthly payments below $1,500 on a 30 year fixed. That's less than renting a decent house in my area so it's better to buy if you have the down payment.

[SCooBY>XI<]

Great time to buy right now and if you have the capitol --mortgage brokers and banks should be lining up to do business with you as most areas of the country are still in a record distress situation in ref to homes sold , loans generated .. etc...

 

Do your homework /legwork as a first time buyer you quallify for many programs and lower rates , preferred financing etc... make the real estate agent work for your business , tell them you want it all !!! as you will NEVER be a first time buyer again , take advantage of it !!!

 

A tactic I like to use , on any major purchase , (cars, boats , homes , etc.. ) is find the lowest price /deal on the transaction , get the offer in writing , then have fun going to different lenders and asking them to beat the offered deal (its not uncommon that the original lender will call you back promising to beat any deal out there at an even lower price as they all had to call him/her to validate the offer you are shopping around ) try it , it has worked well for me .

 

Remember now adays it is a matter of survival for lenders to deal with you --like no other time in history , the Buyer/investor holds the winning hand !!!

 

Congratulations to the both of you and good luck on the house shopping .

[billyblade]

make the seller eat ALL the closing costs as part of your deal. At the price your paying, they aint making just chump change and if they are anxious to sell, they will. if you can pre approve your loan before shopping, you have a better chance of strongarming a great deal!!!! Sellers love not having to "wait and see" if you can get approved after signing a contract and putting up your earnest money.Also, at the time of closing, take the 1 year house insurance. When me and the wife bought ours, we turned it down....within 6 months needed new AC unit...no house insurance( and i'm not talking homeowners here...) and BOOOM ....5600 dollars in already in the first year! YIKES!!!

 

And like Simplemod said...NEVER go into APR. If you can afford to pay more against a fixed with no penalty, then you can reduce ammortization and come out in the long saving money. I know this much, if you a re looking at a house for 420,000, then my assumption is you arent really worried about money to begin with.

 

Trying to strongarm the seller depends on where you are buying and how strong the market is. Xcaliber is buying in Jersey and depending on the proximity to NYC he may be getting a deal on the house and there won't be any room for those kind of negotiations. Get too pushy with the seller and they may just tell you to bug off, especially if they aren't in a hurry to sell.

 

I live north of San Francisco and the market is pretty strong here right now. My parents are both in their late 70's and their house isn't even on the market. Last week a realtor knocked on their door and said their client wants to buy their house, so they're thinking of moving to a smaller place and the offer was great. South of where I am in Silicon Valley people are putting houses on the market and they're getting bid way up from the asking price.

 

If you have a good down payment through savings and family, and you can qualify for a loan of around $300,000, you can have monthly payments below $1,500 on a 30 year fixed. That's less than renting a decent house in my area so it's better to buy if you have the down payment.

nice point ole man. I am in northern alabama, not rural, but not big city, so you're correct, my tactics when i bought served me well for my area and market. It just depends on the seller. But bear in mind xcalibur, if the market is strong where you are, and your seller is over anxious, it should throw up a red flag to some degree. Be careful and best of luck to you and yours.

 

BTW... i lived in the bay area for a few years...absolutley love it, still got family living in Antioch right now. My brother used to live on Lincoln, right across from GoldenGate Park...awesome!!!

 

one more point....dont ask me to help you move...i just dont think i'll be available that weekend..........bwahahahahahahaah!!!

Edited July 6, 2012 by billyblade

[Damit1]

Stop and visit 3 or more lenders! go through the whole ball of wax and DONT FEEL Obligated to work with that lender because they spent an hour with YOU! All of them will give you info that you may or may not have gotten from the other.( or better explained) By the 3rd or maybe 4th you will understand what the hell is going on and what best suits you needs.

Good luck have fun !

[simplemod]

xCaliber,

 

Buying a home for the first time can be difficult and frustarting. Appraisal fees, closing fees, realtor fees, plat drawings, title insurance, bank escro fees....i could keep going on.

 

Yes, shop around for the best interest rates but also shop for best closing costs too. Most if not all banks charge a 1 persent loan origination fee. That's 1 percent of the loan. The Lender requires Title Insurance and you have the option to buy an Owners Policy. The Title Insurance is charged by the Title Company.

 

Also, you have the choice of which Title Company you want to close with. I would call several Title Companies to find out what their fees are. Tell them you are shopping around. Title Companies are always fighting for the biz.

 

 

Aren't you only required Title insurance if you have to borrow 100%. And even then, after you've paid enough to get below the 80% threshhold, no longer required?

 

Howerver, I do know first hand that escrow accounts are forced by some mortgage companies, but not by others. My first 2 years, I paid my taxes and homeowners insurance myself, but when I refinanced, the new morgatger required the escrow, and I just kept it since, cause it does make it a lot easier.

[Bogleg]

You are required to pay PMI (mortgage insurance) if you don't have 20% down; but he doesn't have to worry about that.

 

Generally speaking, I would make sure you have an inspection contingency and a financing contingency on the offer. These alone can help you get out of the deal if something comes up. If you have a good buyer's agent they should help you with the offer and what sorts of contingencies should go into it.

 

Since you are able to put 20% down, you can go with a standard 15, 20, or 30 year fixed mortgage. Your mileage may vary but I prefer to lend from whoever is going to own the loan (i.e. even though I bank at a local credit union, I didn't get my mortgage through them because they just resell it, and it turns out they were reselling mortgages to a bank that failed...). I have had my last three mortgages through Wells Fargo and everything has been fine. The big banks have mortgage departments and mortgage pros who will help you negotiate all the paperwork, closing costs, etc. For the three houses I have purchased, my only expense other than the actual house was the inspection and appraisal fees. Everything else was always covered by the seller as part of the deal - but that's the Midwest for you right now.

 

Escrow for taxes and insurance makes it easier, but you are basically giving the bank your money and they get to collect interest on it instead of you. Since interest rates are sucky right now that's not too big of a deal, but still, you are giving money away. Unfortunately, MOST lenders require them now.

[Bogleg]

Btw, xCaliber, congratulations. Owning your own home is a great thing.

[Merlin007]

There is a lot of good advice here. My wife and I went with an agent we knew and trusted to do what was in our best interest. A home inspection is always a good thing as well these days to try and make sure nothing major is being hidden from you. Anyway, enjoy your new home whichever you choose. An excellent investment for sure. I enjoy owning my own home, the pride and the work I put into it. Cheers

[DorkNRok]

Congrats Xcaliber...while it is a pain in the ass you are living the dream. Hope it all works out and you get the place you really want. Wish I could offer you more advice but being military i move way too much to buy a house and not run the risk of taking a huge loss. Someday though. Serously though, I hope its a good experience and rewarding!

[hxtr]

not read anyone elses but at 20% you can buy points to get your intrest rate the lowest you can. So if 4% you can buy on point to make it 3%.

 

Good luck and sure a few here can help say yea or nay to my suggestion. Good luck and dont let them screw you at closing.

 

Take pictures of the new place and post if you can.

[Labob]

Ah so you got mortage brokers. I found my best deal at one. 3.89 for 10 years have not seen better up here. The next best was loblaws a grocery chain with a bank I think it was 4.02 or something. And lock in long time if you can its going to get rough.

[billyblade]

make sure whatever rate you lock in that there is no penalty for early payoff. If you can lock in the lowest rate possible to ease your monthly expenditures, you may find that you want to pay it off quicker to save alot of money and beat amortization. As long as there is no penalties for early payoff you should be in great shape.

Also, shop your homeowners around besides the obvious biggies. Geico was great for my cars, but to bundle car and home they sucked. I went with Trinity/Kemper from a local agent who helps me and answers my questions very well(and in person if need be). The rate i got beat all and i have already had to file a claim for floor damage from powerooutage due to storms. Paid well and quick, but thats just my experience. Do your due diligence and shop it around.

[Boo Yaa]

Great advice from all above. I've had good success with Quicken Loans online, but for the most part don't recommend doing home loans online. Timely closing is a beotch. I've had good luck with shopping for best rates online, then playing that off with local banks. Good luck and Congrats on your first home!!!

[Bogleg]

I agree with Boo Yaa. I normally will shop online for rates, then call the mortgage consultants at each lender to get the full scoop - both closing costs and rates. I get to enjoy a VA Loan benefit which has helped me out in the past (at one point I had to carry two mortgages due to our crappy housing markets).

 

In any case, I go about it in this order:

 

1) Determine the amount we are willing to pay and what the housing market is like price-wise where we are going.

2) Shop for a lender based on closing costs and rate; any additional benefits (i.e. lower rates for automated online payments) I factor in. For example Wells Fargo knocks .25% off if you bank with them and set up automatic payment.

3) Get a pre-approval letter for the max amount I am willing to spend on a house from any of the lenders, it doesn't really matter which one as long as you are confident you can get a loan from one of them.

4) Find a real estate agent in the market. Don't sign anything. Shop around if you don't like them. A good agent is someone you would go back to again and again.

5) Start looking at houses. Once you find one, write an offer - let your agent help you with this. Your offer will normally include earnest money (usually like $1000) to show your serious and capable.

6) One the offer is accepted, go get your loan from whichever lender you've chosen.

7) Take care of your inspection and appraisal, and make sure any other contingencies are met - most real estate agents will stay on top of this for you.

Close on the house.