Newbie Homebuyers Face New Challenges
It’s the best and worst of times for New Yorkers looking to invest in their first homes, according to the cover story in Sunday’s real estate section of the Times. On the one hand, there’s less competition for properties, prices aren’t skyrocketing, and mortgage rates are low. On the other hand, lenders are wary of…
It’s the best and worst of times for New Yorkers looking to invest in their first homes, according to the cover story in Sunday’s real estate section of the Times. On the one hand, there’s less competition for properties, prices aren’t skyrocketing, and mortgage rates are low. On the other hand, lenders are wary of giving mortgages to would-be borrowers with less than stellar credit (700 is the magic credit history number; any lower than that, and lenders aren’t going to be falling all over themselves to issue a loan). As a result, some first-time buyers are getting creative. One buyer in Clinton Hill, for example, probably wouldn’t have gotten banks to approve his purchase of a $427,500 condo since his credit score was less than 700 and he only had $20,000 saved for a down payment. HSBC gave him a loan, however, because it has a program for ZIP codes with large minority populations and the buyer’s income was high enough to cover monthly mortgage payments. Another couple profiled in the article had their closing delayed despite the fact that they had good credit because their lender wanted them to take an online course about their mortgage (what a drag!). Any readers having troubles securing their first home loans?
Jitters for First-Time Homebuyers [NY Times]
Photo by bonddidwhat.
11:31 – I know 5 different couples who have sold 2 to 3 bedroom apartments over the past 6 months.
ALL got their asking price.
ALL asked for a price higher than the valuation from last year.
ALL were in contract within 2 months of first listing.
ALL were prime Brooklyn properties – BK, BH, CH etc.
Prices really havent gone down for most properties.
Well some prices haven’t gone down, so depending on what area he’s talking about he may be right. Prices seem to have leveled off a bit and appreciation has definitely slowed, but in prime areas I haven’t yet seen prices going down on the whole.
I went to look at an apartment this weekend and I was talking to the broker, telling them that we were looking to buy a year ago, but I had the foresight to wait thinking that prices will go down.
He (broker) said that prices haven’t gone down.
Are brokers that delussional?
I thought it was really funny how the article stated that now was a good time to buy because there is no more fast appreciation! Hah! So, now that the upside is limited, time to dive in! Talk to a broker, and you will never hear it is a bad time to buy.
I don’t think it is a bad idea for first time home/condo buyers, to take some kind of course. There is much to much hearsay, misinformation, small print and possible fraud out there. I also think some kind of course for refi/HELOCs is necessary, especially for older folks who have been out of the loop. These are the people getting defrauded and in over their heads, in part because so much has changed in the real estate industry since they signed their original mortgages.
Yeah, it’s an annoying pain to have to sit through this often boring stuff, and it may delay your deal a few days, but it’s like going to the dentist, better a little pain now, than a whole world of hurting later.
And NO, I’m not a broker. Just would love to see some more conscious family oriented families come on over to the Stuy!
I just lost out on buying a condo because the bank’s appraisal came in under the sale price…in fact, two of the three comp properties listed in the report had adjusted prices way below the actual sale price too. In a situation like this, either the seller has to drop the price to match the appraisal or the buyer has to pony up cash to match the difference in price. No-win for me. I think this may be the latest manifestation of the poor market – banks are hesitant to finance properties that may lose value in the future. Anyone else hear of this happening?
I’ve been going on and on about the HSBC Community Works program for about 2 years now. I got my conforming 30yr fixed rate mortgage in ’05 for 4.875% when regular rates were @ 5.75. Anywhere in Bed-Stuy or the CH/BS border will qualify. It’s a program that is targeted to lesser developed neighborhoods with the intent of attracting quality home/business owners.
http://www.us.hsbc.com/1/2/3/personal/home-loans/mortgage/mortgage-rates/nat-rates
Check the rates today vs. conforming rates.
They also have a good package renovations loan. I didn’t find out about that until after I closed…. but it worked out better for me since I saved enough to do it with cash. ( but it sure did hurt)
No. But thanks to a tip from my neighbor, i called a broker from HSBC last week, and she offered me a 30-yr fixed re-fi at 5.25%, after my guy at Citi told me the best he could do was 5.875%. The lower rate was because of my address on the CH/BS border.