Many renters are hesitant to become first time buyers for various reasons:
- Where to start
- Will you qualify for a loan
- How can you possibly save for the down payment needed
- It seems like there are more buyers than homes for sale right now
- and the list goes on…
Where To Start
Starting can be daunting but it does not need to be. Realtors who specialize in first time buyers help you through every stage of the process. From finding out about a loan, to figuring out your best approach to homes for sale that meet your criteria, to making an offer and negotiating the terms, to navigating the escrow process that results in the keys to your new home.
Qualifying For A Loan
The fact is, these days there is a loan for every kind of buyer. While you may think that a big name lender is where to go for a loan, the reality is that most loans come from boutique lenders who specialize in your financial situation. Thus there are lenders who will lend you money based on your credit score (all the way down to 500) and lenders who will lend based on the home in question and your ability (income) to make the monthly payments. Here, too, a good Realtor will help you sort out what works best for your situation.
The Down Payment
While you may have heard that a 20% down payment is needed, not all loans require 20% down. Some may require more. Other loans may require as little as 5%, 3.5%, 3% or even nothing as the down payment. Not every lender will offer every one of these loans so working with your realtor to identify the right lenders for you becomes even more important. You may find you want to improve your credit score to qualify for a better [for you] loan. Your Realtor will tell you how to do that step-by-step.
More Buyers Than Sellers
It is rare that there is a perfect market these days. Just a few years ago there were many homes for sale at ridiculously low prices, thanks to all the foreclosures that had occurred during economic meltdown. Though you might have thought it was an ideal time to buy a home, lenders were reluctant to make mortgage loans so only those with the very best credit could take advantage of the situation. Today more loans are being made, which means more offers on the homes for sale. More offers means homes sell for more money so we see the average home price rising.
San Diego County’s Current Market
In San Diego County, 2017 saw an average 10.1% increase in home prices over 2016. So far 2018 is about 8% higher than this time last year. Needless to say, first time buyers are very happy with their decision. Those who put off buying a home saw an average 9.6% increase in their rents, while their income has risen an average of 2.6%. Their housing payments can remain fixed at the same amount for 30 years if they had buy instead of rent. Instead, they are at the mercy of their landlord. This is not going to get better in the next 5 years.
I have been working with buyers and sellers since 2005. Specifically focused on helping first-time buyers since 2009, I teach an in-depth class and offer free workshops around the county. There are 57 different programs to help renters become homeowners. The programs are not just for the poor. They cover every kind of buyer, including those in the middle-income and upper-middle-income brackets. You are free to use these programs to buy a home in any area you want.
Getting started is as easy making an appointment. Call/text me at 760 622 5087 or email me here. Isn’t it high time you kept more of your money?