Firsttime buyer looking for advice (to clarify - In Texas)

Im TERRIFIED!


I feel like I'll never be able to afford a house and no one could possible want to lend me money right?

Ugh

So I'm setting a goal. I'm very good at setting goals and working to them. I set a goal to get NY and did, and of course another goal to get home and here I am.

So now I just need to set it up so that I have little things to work on to get to the big "buy a house" stage.



Im looking to take the leap next year after income tax.

Credit ratings are both in the lower to mid 600s. Last I checked but I paid off a LOT of debt in the past year.

I'm paying $1100 in rent right now here in San Antonio. Homes are much much cheaper of course.

What do I do to find out local prices? I stopped at one lil model home place and they gave me info. Nice lil place runs about $179k brand new (as in its not built yet). Its in the district I would want. School area around here makes the costs go up quite a bit. Houses are popping up everywhere.

So.. what should I do?
I feel so lost and it all seems so overwhelming!

Do I call my FCU and ask about mortgage stuff now?

Do I find a realtor?

Ugh

Message edited 10/26/2009 2:31:17 PM.

Re: Firsttime buyer looking for advice

Are your credit scores low because of late payments? If so how long ago were they?

If they are, I would wait until those delinquencies drop off your report before you look to buy.

Low to mid 600 credit scores are not going to get you a great interest rate in this market. So you will be unnecessarially paying more for your house.

Re: Firsttime buyer looking for advice

I think the first thing you need to do is get your credit score up. Low to mid 600's are going to make getting a mortgage much more difficult and if you do get one, it will be at a higher interest rate.

You should also try going to open houses. We did that before we were seriously considering buying (although news of a baby on the way made us serious buyers rather quickly).

By going to open houses you have an opportunity to see what X amt of money buys and what you can expect. It will also help you see trends in prices and you can try to keep track of the houses you saw and see how much they sold for and how close/far it was from asking price (this is easy if you have Multiple Listing in your area). Also, by going to open houses you'll have the chance to interact with different real estate brokers and find one you like (this is what happened for us).

Good luck.

Re: Firsttime buyer looking for advice

first step is call your bank or a bank. get pre-approved. its different then pre-qualified. for Pre-approved they actually run your credit etc etc. they will tell you what you can afford.

I have a great guy at bethpage federal credit union if you need a bank. they also have no bank closing cost fees. I think in total we are only paying the bank for the appraisal, and that's it. most banks fees cost around 1,000

then call a realtor from there, or you can just start looking on MLSLI.com but a realtor makes your life so much easier.

You also should start looking into fanniemay (I think that's the spelling) if you don't have the money for a down payment and closing costs. you can do a google search for it. I'm not sure if you qualify, but it goes by your income and debts you have, its worth a shot.

for an FHA loan the minimum down payment you can do is 3.5% of the purchase price. and then you need to cover closing costs which are about 3-4% of the purchase price on average. Most banks will do FHA. if you don't have all that cash, you can do a sellers consession for the closing costs where you basically finance a percentage of the closing costs.

Good luck. and by the way, its TOTALLY normal to feel overwhelmed, with your first house. Its a huge leap and a lot of money! Good luck with your seach and try to enjoy it, some of it's actually fun

And post lots over here, everyone is so helpful and full of knowledge!!

ETA- are you looking on LI?

Message edited 10/26/2009 12:59:53 PM.

Re: Firsttime buyer looking for advice

we were able to get a usda loan. for rural development.

no money down, no pmi. we got a 5% rate. you should check that out

Re: Firsttime buyer looking for advice

Hello Xelindrya, I am a Realtor on Long Island and I totally understand your confusion. The best place to start is with a Pre-Approval. You can obtain this through any Mortgage Lender, Bank, or your Credit Union. This should be a no-cost consultation for you. By obtaining this Pre-Approval you will be then have an idea of how much you can afford. You really need to know that before you go looking at houses. Once you know how much you can afford then try to narrow down what towns you would be interested in. If you are not sure there are plenty of sites that can give you neighborhood and school ratings information. From there it is then best to contact a Real Estate agent to start looking at some homes.

It can be an overwhelming experience, but well worth it. Take it one step at a time and start with the Pre-Approval step. With the interest rates so low right now you can buy more house. Once the rates start going up, the same price house will cost you more. It is best to try and take advantage of these rates if at all possible. By the way, the mortgage professional that you use can tell you other ways to improve your credit, so you may find that you can get those numbers up as well.

If I can answer any questions for you, don't hesitate to contact me. If you are looking for a website to search for houses on and to find out neighborhood info you can click www.realestateonlongisland.listingbook.com and sign up for Listingbook. Listingbook is a great tool to help you find houses and demographic info. I hope that helps you. I am always here if you have any questions. Good Luck!

Message edited 10/26/2009 1:50:38 PM.

Re: Firsttime buyer looking for advice

Thanks folks.

Lots of good info

I guess I should rerun my credit and see where I am first, huh?

And this is DEFINTELY TEXAS. I could never ever ever EVER afford a home in Long Island.. EVER NEVER EVER!

I dont care how good I got my credit score or how much I could steal from a bank I'd never be able to live in Long Island, which is why I moved. I was just tossing my money away on rent.

Homes are not as expensive here and from what I've gathered mid 600s is considered well qualified here.

I'll have to look into that further.

Open houses are a good idea, Thanks.

Does pre-qualify hurt my credit in anyway? We dont need a mortage to look around here. We can see as many homes as we'd like without it. So before I do a prequailfication should I wait? are there any cons to it if im not ready to buy in the next 6months?

Re: Firsttime buyer looking for advice (to clarify - In Texas)

Posted by Xelindrya

Thanks folks.

Lots of good info

I guess I should rerun my credit and see where I am first, huh?

And this is DEFINTELY TEXAS. I could never ever ever EVER afford a home in Long Island.. EVER NEVER EVER!

I dont care how good I got my credit score or how much I could steal from a bank I'd never be able to live in Long Island, which is why I moved. I was just tossing my money away on rent.

Homes are not as expensive here and from what I've gathered mid 600s is considered well qualified here.

I'll have to look into that further.

Open houses are a good idea, Thanks.

Does pre-qualify hurt my credit in anyway? We dont need a mortage to look around here. We can see as many homes as we'd like without it. So before I do a prequailfication should I wait? are there any cons to it if im not ready to buy in the next 6months?

Message edited 10/26/2009 2:48:50 PM.

Re: Firsttime buyer looking for advice (to clarify - In Texas)

Posted by alli3131

Posted by Xelindrya

Thanks folks.

Lots of good info

I guess I should rerun my credit and see where I am first, huh?

And this is DEFINTELY TEXAS. I could never ever ever EVER afford a home in Long Island.. EVER NEVER EVER!

I dont care how good I got my credit score or how much I could steal from a bank I'd never be able to live in Long Island, which is why I moved. I was just tossing my money away on rent.

Homes are not as expensive here and from what I've gathered mid 600s is considered well qualified here.

I'll have to look into that further.

Open houses are a good idea, Thanks.

Does pre-qualify hurt my credit in anyway? We dont need a mortage to look around here. We can see as many homes as we'd like without it. So before I do a prequailfication should I wait? are there any cons to it if im not ready to buy in the next 6months?

i would get a pre-qual so you know exactly what you would be able to get a mortgage for. You do not want to go out and find something you love only to find out that you are not able to get a mortgage

Message edited 10/26/2009 3:31:54 PM.

Re: Firsttime buyer looking for advice (to clarify - In Texas)

I would speak with your credit union to get a sense of where you are at and what they would approve you for now and what you'd get later on. Getting pre-qualified does not affect your score b/c they don't get your credit score. They are basing their info on some preliminary information that you give them. Use it as a guide to help you look around at homes; you dont' want to look at ones you won't be able to afford in the end.

Every time someone checks your credit, it goes down a tiny bit, so I wouldn't touch it unless you saw an error on your report.

When we were looking, we used a site called Redfin. It's a multi-state MLS service. They have listing all over the country and we found it to be excellent. Just another tool to use before you find a realtor to work with.

GL!