Great information for first time home buyers. For more information on debt relief and debt consolidation go to www.Delraycc.com

For first time home buyers, the American Dream Down Payment Act has made it easier to make their dream true of buying their own home.

A home is not just an investment but a personal joy and a stronghold that brings a sense of security to you and your family.

The good news is that the American Government has sanctioned $200 million for grants each year for the coming four years to low-income groups who want to buy their first home.

This certainly makes the castle in the sky closer for those who dream of buying their own home and are unable to do so because of the heavy initial down payments in the process.

Government Grants For First-Time Home Buyers

The Government has launched the American Dream Down Payment Initiative Grant for which it has tied up with banks to facilitate this process in order to boost the country’s economy by allowing more fluidity in loans to first time home buyers.

One of the best things that have come out of this is that there is no window for getting cheated because the state and federal agencies are the most credible people you can literally speaking, bank on as compared to any realtor or predatory loan shark.

Now, not only has the problem with the initial finance been obliterated but the interest rates with banks are also touching rock bottom and all financial assistance professionals are urging you to benefit of this wonderful opportunity.

Once you are in possession of your own home the equity in it can be the source of making the next down payment.

As this facility is not available to you if you are a first time home buyer and you don’t have any equity in property, the Federal Government has come up with this scheme of offering first time home buyer grants.

Not only are these grants a boon to making the payment but are also immensely practical in closing the mortgage.

In this case, even bad credit can’t be counted against you as you have not had in your own name any housing ownership within the last three years.

Tax Benefits

A substantial amount of tax savings can be generated through your mortgage interests too. If you are renting an apartment for a certain amount, the same amount when applied to your mortgage loan payment would result in a huge tax deduction as practically speaking, the preliminary mortgage payment is generally to cover up interest rather than actually paying off the loan and this interest is tax deductible.

If you are in the conventional 28% tax bracket with all the normal expenditure, this deduction could cause a major dent in your annual savings.

There are absolutely no issues and hang-ups and the only quantifiable point is that your annual family income should meet the stipulated minimum in order to receive the grant, which is calculated on the basis of income v/s dependents, the location of the home etc.

 However, not every state in the USA is offering this kind of a grant yet, though it is still possible to obtain a grant through federal assistance. It is important to note that each state has its own set of rules and regulations that apply to the grant program as instigated by the state legislature.

Why is this Free Money?

The government is labeling this money as free money because as there are no interests or monthly payments to be made it is virtually free, these funds remain mute as a second mortgage until they are repaid.

In other cases, they are simply forgiven like in the State of Wyoming; the government grant for first-time home buyers can be as high as $2,000 and is forgiven in the case that you reside in the house for a period of 30 years.

This differs in different states and some states offer a loan that turns into a grant after a certain period of time. Thus a loan calls for the amount to be repaid in installments even if it for a low interest rate.

However this is only a qualifying process for the mortgage and in most cases you receive a percentage of the mortgage amount making it all very easy in the long run.

Unmasking the Grant Availability

All this may be a little difficult to believe at first and reason dictates that this kind of money will be hard to obtain for the average seeker but in reality these grants are not highly advertised by the government and there are few sources that can give you the necessary data so the chances that you will have people queuing up outside these agencies and going away with pot loads of money is very, very slim.

Most of these agencies have not exhausted their capacity which simply goes to say that there is money available for obtaining that grant.

Lastly, a home is definitely high on the list of safe investments into the future as the escalation of prices for properties is constantly on the rise owing to growing population and economy that gives way to inflation that causes real estate investments to be stable if not a climber.

Now is the best time to take advantage of the extremely low interest rates and make good your dream of owning your home.

Rate Cuts and Grants for New Home Buyers

The seven-year high in first home buyer commitments showed the property sector would benefit from the government extending the increased grants until at least the end of 2009.

Don’t Bet your House – It Can Be Cheaper to Buy

A combination of slashed interest rates, increasing rents, falling house prices and generous first-home buyer grants means that for the first time in many years, buying has become an economical option.

By Jayashree Pakhare
Published: 4/20/2007

Many people can afford to buy a house if they have the proper resources and there are two conditions that should be addressed.

Firstly, you may need to repair your credit profile if it may have been damaged so that you are more appealing to home and mortgage lenders; secondly discovering a potential home seller that has common financial interests also helps greatly.

But after this, one of the most important questions is whether you have the necessary income to maintain the house after it has been purchased.

Before you buy your first home you should determine if you can afford the house.

If you begin viewing homes and find a desirable one, then when it comes time to look at your finances, you may think that there is no possible way you can afford it.

This may almost be a crushing emotional blow but you should not be discouraged.

Often there is another avenue that you may not have considered and instead of becoming sad about the initial bad feelings you should try again.

At this point, many potential first home buyers simply give up and think that it can’t be done for them.

But before totally abandoning the possibility of buying that first house, here are some points you should consider prior to concluding that house is not possible for you.

You may be surprised at how these small suggestions can help you in big ways.

One of the first things always suggested is creating a budget. Virtually no one likes to set a budget, but you should seriously consider doing this.

This will determine the money coming in and what you are paying out for daily living expenses and bills.

You need to know the amount of money you have to make payments on a home. Keep in mind that this number may include what you already pay in rent.

This will determine to a significant degree what you can afford when you decide to buy a house of any form.

One almost easy part of assessing your budget is to track your monthly bills and income. Generally, these are similar each month.

The hardest part of the budget tracking involves what you spend at any store and this includes purchases for items bought over the Internet.

You can use software programs to track your debit and credit card transactions or record them manually, but either way, it effectively makes it easier to find out where you are spending your money.

If you use credit cards to make purchases, you should track how much you are spending each month.

Is it greater or less than your potential monthly payment? The most difficult part of your budget is to assess cash based transactions.

You should retain all of your receipts or otherwise you won’t know where the money goes. Do this for one month and save all your receipts.

Once you have them in hand and review them, you may be quite surprised at how much you actually spend. After this, decide what items can be eliminated or reduced to allow for savings.

A home budget analyzer is a valuable tool that is virtually necessary.

This can be done using a simple spreadsheet and does not take much time to update every other day or even weekly.

Once you have this information in hand, the potential lenders you may encounter will appreciate this and be more receptive in you having prepared yourself.

Most potential lenders may only wish to know if you have sufficient funds for a down payment and can afford the initial series of mortgage payments.

Once they are satisfied with this, the remaining financial obligations are left to you.

An additional spreadsheet or personal financial profile will help in providing them with information about your personal assets and liabilities.

But this is not enough, because you must be weary that if they are providing you with the best deal, or simply attempting to earn their commssion.

The competition for your money is intense and you should not think that for even a moment that that they are attempting to do you a favor.

Rather, they want you money and may even provide you with a new Microwave Oven as a bonus.

So look around for a good rate or repair the credit rating you have before venturing into buying that first home or condominium.

In the not so distant past getting a free toaster was considered  acceptable, and for now at a bare minimum, a better interest rate is far more desirable.

Are Credit Scores Reliable Bases for Home Mortgage Loans?

Credit scores may already be obsolete and irrelevant as basis for evaluating people who are applying for home mortgage loans.

Buying your first home can be one of the most exciting times of your life. For 1st time homebuyers, never stretch yourself financially. Always try to live below your means. Never borrow to the max against your income.

Purchasing your first home can be very exciting and yet at the same time, be very frightening too. One of the first things that 1st time homebuyers are concerned about is how are they going to maintain their outstanding credit rating or how they will repair their credit rating once they purchase the home.

This is a great concern to the 1st time homebuyers because most of them do not have enough to buy the house upfront and as a result, they have to takeout a loan from a bank or some other financial institution for the mortgage.

The problem is with a combination of high interest rates, along with the typical living expenses as well as taxes; a lot of people are struggling in terms of keeping up with the bills.

The majority of 1st time homebuyers end up deep in debt and this is a serious issue for most of these people.

It’s true that one of the biggest causes of stress is financial debt.

Be Wise

Regardless of whether you have good credit to begin with or not, the last thing you want do is to worsen your credit rating. Here are a few important steps that you can take. The very first thing you should always consider is to live below your means.

Far too many people in society today are trying to keep up with the Jones.

Spending money on things they shouldn’t be buying or not having a tight rein on their budget. That being said, determine what your income is and how much of a mortgage your income will support.

Do not stretch yourself financially. Always remember there are additional costs when purchasing a home such as, renovations and repairs, as well as new furniture too.

Choose a Mortgage Type

Also as a new home buyer, you will have to decide if you want an open or closed mortgage. The advantage with an open mortgage is that you can repay the loan off any time during the term of the mortgage.

Even though you can pay off your mortgage faster with an open mortgage, the interest rates are generally higher with these mortgages. This is something you have to take into consideration.

With close mortgages, they have a longer, set term and limited prepayment options. When compared to an open mortgage, there is less flexibility, but at the same time you are gaining in terms of a lower interest rate.

As well, the rate will always remain the same so you don’t after worry about rising interest rates. Nothing is more stressful than to see your monthly payments go up sharply and unexpectedly.

Save Your Money

As an initial home buyer, it is wise to put down as much as you can as a down payment. The more that can put down on the property, the smaller the mortgage you will have to finance and the less anxiety you will experience.

It’s also a wise idea to try to save some money in the bank for emergency situations. With that extra money, you can also pay down the mortgage faster if the opportunity presents itself.

Presently, we are experiencing a buyers market. This is a great time to be a first time home buyer because you can get more house in a better location for less money.

In addition to that interest rates on mortgages are low. This is still likely the biggest investment of your life and you don’t want to make a mistake. It can take between 30 to 90 days for the entire purchase process, although timelines vary according to individual buyer and seller circumstances.

Get a Pre-Approved Mortgage First

Most realtors will not show you homes unless you pre-qualify, so they know that you are serious about buying. Gather past 1040s, bank statements, credit account numbers and determine how much you have for a down payment.

Your realtor can give you a ballpark figure for the type of mortgage you will qualify and can steer you to a mortgage broker.

Once you get a pre-approval status from your lender of choice, they give you a Loan Status Report (LSR). You can then determine what price range of homes to consider.

If your lender pre-qualifies you for monthly payments you are not comfortable with, buy under that amount. You are the one that has to make that payment each month.

Start Looking at Homes Available for Purchase

Many people begin their search on the internet. You can save a lot of time by doing some research. Some people like to drive through their preferred neighborhood to see what is available.

Be careful of  ’For Sale by Owner’ properties, many of these owners have unrealistic expectations of the value of their property.

Once you have narrowed down your search, it is good to contact a realtor who can help you evaluate your choices and make an offer.

They will know what comparable properties in the area have actually sold for, not just the list price.

Make an Offer to Purchase

You submit a contract to the seller stating the amount you are offering along with the LSR so that they know you are serious. The seller may counter offer.

Once both the buyer and seller accept the offer both sides are obligated to follow through. It is always contingent on the buyer getting their loan. Your realtor will monitor the process until closing.

Money Down, Home Inspection and Appraisal

You must put down earnest money and then begin the application for the loan. There will be a home inspection which can be paid for by either the buyer or seller depending upon the terms agreed upon.

It is still possible to back out if the home inspection finds a problem that you and the seller can resolve. The lender requires an appraisal to make sure that the house has enough value to cover their loan should you default.

Once the lender gives final loan approval, you are ready for closing.

The Closing

You will get to have a final walk through to make sure everything is the same. Then a title company prepares all the documents for the signing of both parties. The title company oversees all the document signing and delivers the title to you, the new owner.

Move-in can be immediate or up 30 days depending on the agreed dates between buyer and seller.

Are Home Buyers Starting To Kick The Tires?

The $787 billion dollar economic stimulus plan becomes law today and includes an $8000 tax credit for first-time home buyers. The plan also includes tax credits for current homeowners that choose to make their homes more energy efficient.

Is It Smart to Buy a Home in This Recession?

Tips on saving and investing, dealing with debt, managing credit, and excelling in your career and your life.

This informative video presentation outlines the recommended steps that first time home buyers should take, including what programs are available. This includes helping new home buyers learn about obtaining the best home mortgage, tax credits, grants, engaging real estate agents, down payment assistance programs and other useful information.

This brief mortgage minute video is addressed mostly to first time home buyers and answers the question “Should you buy a home that is being sold short?” This occurs when the owner owes more to the lender of the mortgage than the actual appraised value of the home.

As an example, consider a home you are interested in as a new home buyer that is listed at $150,000. However, the present owner owes almost $200,000 to the mortgage provider (e.g. a bank). Before you can purchase the house, aside from you, both the bank and the seller must agree with selling the home short, or at a loss.

Two almost funny guys share four important tips for first time home buyers. These are: using a realtor, buy the home considering that you will sell it in a few years, get a home inspection, and contact a mortgage specialist to get pre-approval.

They also provide links to other videos such as:

• Should I Buy a Home Now?
• Can I Buy a Home After Bankruptcy?
• Tips on Finding a Good Listing Agent
• Mortgage Myth Busting
• How to Find a Great Buyers Agent
• 7 Red Flags to Look for When Choosing a Loan Officer
• Does Zero Down Still Exist?

The signs of an improvement in the economy are normally seen in the housing sector and this may be now happening according to Carl Delmont, CEO of Freemont Mortgage.

In this video, he explain what sellers and first time home buyers should be looking for and offers some important guidelines.

An owner and agent at a RE/MAX office provides advice for First Time Home Buyers.

realestatemarketingthisweek.com – $8,000 tax credit for first time home buyers with low down payment – Part 3 – We have back in the studio today Mr. Dan Havey.

Dan and I have worked together in the mortgage industry for about 14 years and we are happy to have him back. He has seen a lot of changes in the market and thanks again for being here.

Michael, here is a question I wanted to ask you, there is so much misconception in the marketplace today as far as what is still available for financing. I think a lot of people have this idea that it is impossible to finance a loan or get a mortgage or that you have to be able to put 20% down or have a 720 FICO score.

Can you let people know whats really going on out there? Well you know a lot of things have gone away. There are a lot of those old loan programs that were fancy ways to sell money and finance real property and a lot of thats gone.

The reality of it is, if a person has a minimal amount of money down, there is absolutely financing through the Federal Housing Administration with 3.5% down. You can buy up to about 8000 with only 3.5% down.

Now with Fannie Mae and Freddie Mac, we actually do have a few investors that will allow us to only put 5% down with those and that loan amount maximum is 7000. So there is still plenty of financing for primary residences.

I need a bit of information here. I know as much as I can find about loan assumptions and have consulted with the VA. I have been in my house for about 2 years and am ready to move. My buddy will assume my mortgage (cut down on costs). My only question is this, will he be considered a first time home buyer and get his 8k tax credit? Or since he is assuming a loan is he not considered first time home buyer?

My best friend bought her home back in 2006 but this year on may of 2009;  she added me to the deed since I’ve been the one living in the house since 2006 and paying for the mortgage. I already filed my 2008 return but wondering if i need to do an amendment return to apply for the first time home buyer credit with form 5405.

PLEASE HELP !

 thanks !

My wife and I are getting divorced. We currently own a home and both our names are on the mortgage. If I were to buy my own house in my own name, do I qualify as a first time home buyer?
I live in PA

I live in Colorado, just starting a new job where I will make a minimum of 68,500 (medical field so I will be able to increase my income to about 75,000 with extra hours). I’d REALLY like to buy a house, but with being a new graduate, I basically have very little for a down payment. I don’t know how much of a housing payment I can afford per month while still saving money, etc. No student loans need to be paid off, the government is doing that for me, and I have minor other monthly payments, no children, and I am single…

My question is, are there any downsides to an FHA loan?? Can someone give me a straight answer about how much of a mortgage I can afford, instead of these generic online calculators?? DON’T REPLY WITH GENERIC ADVICE THAT I HAVE ALREADY FOUND ONLINE. I would like to hear someone’s personal experience. Being a first time buyer, I don’t want to live beyond my means and become another casualty of the housing market…Thanks!