The Federal Housing Administration (FHA) will implement some new guidelines on April 5, 2010 that will tighten FHA financing and pinch buyer's purchasing power. They are increasing the Mortgage Insurance Premium (MIP) from 1.75% to 2.25%. This does not affect a buyers amount of cash they need to have for closing since that can be financed, but it will affect their pre-approval and it could increase their monthly payment by $50 to $100.
FHA is also decreasing the amount of seller concessions allowed to the borrower from 6% to 3%. This change will affect how much the buyer will need to raise for closing. However, this money can also be "gifted" by family or elsewhere. In addition, FHA will provide loans for buyers with credit scores 580 and below but will require a minimum down payment of 10%. Buyers with credit scores higher than 580 will require a minimum 3.5% down payment.
With these changes coming into play, it is just another good reason why buyers should act now and take advantage of this market.
Wednesday, February 24, 2010
Friday, February 19, 2010
When it rains, it pours....
As a homeowner, my year has not started out as smoothly as I would of wished. Not only did I get water in my basement from all the massive amounts of rain and snow which left my husband and I no choice but to have a waterproofing company come out and fix the issue, but $6,800 and 2 weeks later our HVAC goes up! No heat. So here we go again....
To say that we were stressed out was an understatement, but that's the territory that comes with home ownership. There are ups and downs to everything. But there were some positives that came out of these two experiences. For starters, my husband and I became very well educated in basement waterproofing and HVAC units. In turn, that enabled us to became excellent shoppers and negotiators which enabled us to get the best deal. Not only that, we have gained a piece of mind knowing that the problems are fixed and these repairs will increase the resale value of our home as well as increase the appeal to potential buyers.
If you find yourself in the same situation or are simply interested in starting a new home project do not be afraid to get educated and shop around. The rule of thumb is to get at least three estimates from three different companies. Do not be afraid to price match. And most importantly, be patient about the process and your choices.
To say that we were stressed out was an understatement, but that's the territory that comes with home ownership. There are ups and downs to everything. But there were some positives that came out of these two experiences. For starters, my husband and I became very well educated in basement waterproofing and HVAC units. In turn, that enabled us to became excellent shoppers and negotiators which enabled us to get the best deal. Not only that, we have gained a piece of mind knowing that the problems are fixed and these repairs will increase the resale value of our home as well as increase the appeal to potential buyers.
If you find yourself in the same situation or are simply interested in starting a new home project do not be afraid to get educated and shop around. The rule of thumb is to get at least three estimates from three different companies. Do not be afraid to price match. And most importantly, be patient about the process and your choices.
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