On The Money Latest Home & Real Estate Posts
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Is now a good time to buy a home?
It’s a common question these days as potential homeowners wonder if it’s the time to capitalize on low prices, foreclosures and fairly low interest rates. But determining when it’s right to buy isn’t all about the market, Carmen said. It’s about you and the state of your money.
Marc Hedlund, CEO of community finance site Wesabe, said that he’s noticing a lot of people are holding off on buying, even with prices down. They will start the process, and many will even make an offer to a bank for a distressed property, but the bank will take up to 90 days to review it and in that time the offer will most likely go away. Buyers are also noticing that the requirements on them are much higher than they used to be. You need two appraisals instead of one and at least 20% down. Also, you need good credit.
John Ulzheimer said that while a 580 credit score would have gotten you a great mortgage just two years ago, now you need to be “well well well into” the 700s to get the best deal from a lender. His best advice? Start early and give yourself time to prepare. Give yourself 60 – 90 days to do things like pay off your credit card debt and then leaving your cards dormant for the duration of the underwriting process. And hold off on financing anything else, he said. Lenders get nervous when they see inquired on your credit report about any impending debt. So if you need a new car to go along with the new digs, wait until you’ve signed the dotted line on the mortgage first.
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