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There are several great programs for First Time Home Buyers in the Los Angeles County area. Also, for those purchasing your new home for the first time, there is the 2009 Federal Tax Credit of up to $8,000. Get Pre-Qualified Now so you can buy before the Tax Credit expires Dec. 1, 2009.
Now is the time to take advantage of the buyers market and find that special property. As a California Real Estate Broker, investment property owner, and former retail banker (Cal Fed Bank, Citibank, and City National Bank), I am ready to bring all of my knowledge, experience and highest level of customer service to work for you. Just email me with your specific real estate criteria and I will respond to you that same day.
Get Pre-Qualified Now
Before you begin looking for a home, it is important that you get pre-qualified for a loan. In order to get Pre-Qualified, I will need a recent paycheck stub, recent bank statement, credit report (you can obtain this for free at www.annualcreditreport.com or an authorization to pull credit and your most recent tax return. Once you are Pre-Qualified, you will have a better idea of what your payments will be and the home price you can afford. Also, a Pre-Qualification Letter will help to strengthen your purchase offer because it shows the seller that you have already made arrangements for your financing.
In most cases, a Pre-Approval letter will be required depending on seller requirements. This is typically the case with Bank Owned or REO Properties. For example, if the seller is Bank of America, they will ask that you get pre-approved through one of the Bank of America Loan Officers whose name and contact information will be provided by the listing agent. This lender is called a “direct endorsement lender” and is a bank requirement. Keep in mind that the buyer is not required to obtain financing from this direct endorsement lender to close the transaction.
Down Payment Requirements will depend on the loan program type. Conventional Loans have the least amount of restrictions with regard to acceptable property types and require at least 20% down. Financing is available with 10% down, however the rate is typically higher.
For First Time Homebuyers, there are Low Down Payment financing programs requiring less than 10% Down Payment including the Cal HFA-30 (5 % down) and FHA (3 ½ % down). For more information on these programs, please visit my First Time Home Buyer page.
CLOSING COSTS:
You will be required to pay fees for escrow services, title insurance, loan origination, loan processing, underwriting, appraisal, notary, recording and other misc. fees. These fees must be paid by the buyer/borrower prior to the close of escrow. Typically, the closing costs will range between 2-3 % of the sale price.
Additionally, the buyer should have Reserve Funds of anywhere between 2 to 6 months PITI (Principal, Interest, Taxes and Insurance) to show the lender that you are able to afford the payment should something unforeseen happen. In short, the smaller the down payment, the more reserves the lender will likely want to see and the more fees the borrower will likely have to pay.
QUALIFYING FOR THE MORTGAGE:
Your mortgage payment to the lender includes the following items (PITI):
- The principal payment on the loan (P)
- The interest payment on the loan (I)
- Property taxes due on the home (T),
- The homeowner’s or hazard insurance (I)
Your total monthly PITI and all other debts (including car loans, personal loans, credit cards, student loans, etc.) should range between 35-42 % of your gross monthly income. I would love to help you get Pre-Qualified for a mortgage today. Call me at 818-357-9658 or fill out our online form to Get Pre-Qualified Now!
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