The people that attend our first-time homebuyer class have been asking a lot of questions lately about the deadlines for the refundable tax credit.  This is the credit that gives you $8000 as a first-time homebuyer.  As it stands right now, and there is NOTHING in the wind that leaves us to believe the credit timelines will be extended, you must WRITE your purchase agreement offer on or before April 30^th,  2010.  So, to clarify, you DON’T have to buy the home by April 30^th, you have to have written a contract on the home by April 30^th.

The next part of the tax credit has a deadline for when the home must be purchased.  You must COMPLETE the sale on or before June 30^th in order to receive the tax credit.  That means you have to have “closed” the sale or had money exchange hands with the seller.

If you haven’t started shopping yet, here are some hints and tips:

• Don’t even consider looking at short sales.  The time it takes banks to approve these sales varies greatly from bank to bank, but generally is quite long.  You don’t have that kind of time anymore.  If you don’t care about the tax credit, short sales can still be a good value for you.

• Don’t wait till the last minute.  Get out there shopping right now.  There will likely be a last minutes rush which means you won’t have as many choices as you do right now.

• Work only with reputable lenders and realtors to avoid making mistakes that might cost you the home at the last minute.

And good luck.  You’ll never see great deals like this again…

For more detailed information, come to our FREE NO OBLIGATION FIRST TIME HOMEBUYER class or wait for future blogs.  “Simple answers to home ownership questions”.

A HUD home is a foreclosed home which is now owned by the Department of Housing and Urban Development (HUD) of the Federal government.  How did it become a HUD home?  The home buyer used an FHA mortgage to purchase the home.  If you read our blog on FHA mortgages, you remember that these are mortgages which are “insured” or “guaranteed” by HUD.  In other words, the bank lends you the money but HUD assures the bank that in case of foreclosure, HUD will pay the bank any losses that occur.  The bank is insured against default by HUD.

In Minnesota, the process to purchase a HUD home is a little different than purchasing any other foreclosed home.  The process is an auction process.  The rules may vary depending on how long the home has been on the market but briefly, you will be submitting a sealed bid to HUD.  Other buyers may submit sealed bids as well.  If your bid meets the minimum bid requirement established by HUD for this property, AND it also yields the biggest profit of all the bids to HUD, you will “win” the home.  Be sure to work with a Realtor when purchasing a HUD home because the rules are quite different than those used in purchasing other homes.  Both your right to a home inspection and your right to a refund of your earnest money differ for HUD homes.

For more detailed information, come to our FREE NO OBLIGATION FIRST TIME HOMEBUYER class or wait for future blogs.  “Simple answers to home ownership questions”.

Many Home Buyers are surprised to learn that in addition to a down payment, they may need to pay other fees at closing, commonly referred to as “closing costs”.  The amount of these fees will vary from mortgage company to mortgage company.  A good estimate is about 3-3.5% of the purchase price of the home.  

When you are buying your first home, it may be hard for you to come up with enough money for both a down payment and closing costs.  Many first time Home Buyers ask for closing cost assistance from the Seller.  Most mortgage programs will permit the Sellers to help the Buyer pay for their closing costs.  All you need is the Seller’s consent.  Your Realtor will ask the Seller for this assistance when they write up the contract on your new home.  Asking the seller for closing cost help is very commonly done, especially when buying your first home.

For more detailed information, come to our FREE NO OBLIGATION FIRST TIME HOMEBUYER class or wait for future blogs.  “Simple answers to home ownership questions”.

Buying a home is not like buying a car.  It’s a lot more complicated and with many more risks for you, the prospective home buyer.  We recommend attending one or more first time home buyer classes or meeting with a Realtor or Mortgage Consultant who specializes in working with first time home buyers. 

Your first step then is to locate a class.  Sometimes you will find classes offered through your local community education resource.  Other classes may be offered by government agencies.  Other sources of classes are Realtors and Mortgage Lenders who sponsor them.  Sometimes they will be listed in the housing or home section of your local newspaper or information website.

Wherever you go, whatever you do, become educated on how to buy a home.  If you know about the risks ahead of time, you can avoid the most common mistakes made by home buyers.

For more detailed information, come to our FREE NO OBLIGATION FIRST TIME HOMEBUYER class or wait for future blogs.  “Simple answers to home ownership questions”.