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Should I begin to look for mortgage? Please take a look at my situation and let me know..

Hello, I'm looking for some quick advise here. Prices on home in my area are hitting the point were the monthly payments would be cheaper than renting(and about the same after taxes, maintenance costs etc).Here is my economic situation:My fiance and I both worked at the same company which closed, we were unemployed for a month and luckily we both got new jobs(we make about 10k less then what we did all together). AS far as down payments go we are still recovering, right now, we would maybe be able to put down 3.5 - 5%, obviously, the longer we wait the more we would be able to. I had 100% planned to get 20% down, but with prices what they are, I'm not sure if I should act.We are not looking for anything ridiculous, under 150k in MA is what we are looking for. I am looking for something that I would even be able to make payments on if I were to end up on unemployment.Credit scores: 706 and 702, also what % APR would we expect?Should I begin to look seriously or is this a pip dream? We are still young, only 23 so I may be crazy by brizonb from Boston, Massachusetts. Dec 18th 2009 Reply

Leo Harvey (LHARVEY)
#7 ranked lender in Pennsylvania - 141 contributions

Hi guys: The other poster Jeff is correct. It looks like the real estate market is starting to recover slightly in higher home sales and slightly higher prices in some areas. This is good news for current owners and still good news for buyers. It sounds like you both have good heads on your shoulders based on your analysis and plans. Here is the good news. The government has extended the first time home buyers credit to the end of May next year so the incentive to purchase now is huge. Government insured loans like the FHA or the USDA guaranteed loan will allow you to purchase with a minimum down payment so don't let that stop you. Good luck in your search and don't hesitate to contact me if any further questions arise.

Dec 20th 2009
Jeff Drew (Jeff Drew)
#3 ranked lender in Massachusetts - 5 contributions

Brizonb,You have ask a few very good questions.First, it is always best to speak with a professional about obtaining a mortgage before you start looking for a property. This way you have all of the facts before you move forward. This is why I always offer a no cost, no obligation consultation where we review the loan process, different loan programs such as USDA, FHA, conventional finacing etc. and discuss how you might want to structure your offer to purchase. Always know if you can get an approval before you start to look at properties.As for your question of is this a good time to buy? I believe it is with the prices of homes low and interest rates at or near los of all time your total repayment costs are lower than they have been before.As for the down payment question; you can wait until you have the 20% or utilize some of the lower down payment programs available. I believe that keeping money as reserves as an emergency fund can be even more important that putting the 20% down. You can always pay extra towrds principle when you feel the time is right for you.Congratulations on finding jobs so quickly. You were fortunate in comparision to some folks I speak with on a daily basis. Is there a risk of job loss out there still? Of course. It really could happen to anyone at anytime. The chancees will be greater until the economy really starts to improve and companies begin hiring again.You asked about APR; mortgage rates have been in the high fours to low fives for the past year. They are expected to go up next year once the FED stops buying mortgage backed securities at the end of the first quarter. They will also increase once inflation becomes a concern.Is the time right for you? Only you can answer that question. Let's discuss what the payment would look like for the area of Massachusetts you are looking and the rest of your current expenses and expected costs after acqusition to see what is really affordable.Then, armed with then facts, you will know what makes the most sense for you.I look forward to the opportunity tom speak with you.

Dec 19th 2009
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