If you are ready to move out on your own, and Kiss Your Landlord Good-bye… CONGRATULATIONS! Earlier this year the newest part of the Government’s program to help people buy a house went into place! First Time Home Buyers definitely have an advantage in NC, and we offer all of the First Time Home Buyer NC programs that can help you with your first home!
As mortgage interest rates continue to climb in the fall of 2013, these Government First Time Home Buyer programs are more important than ever. Not every Bank offers them, but the NCHFA Programs increase buyer qualifications – allowing folks who have been renting to purchase a slightly larger house than they would otherwise be able to buy… with very few out of pocket expenses – using the NC First Time Home Buyer Program.
Johanna Brown, an agent with Re/Max United in Cary, said it would be pretty common for people sitting on the fence to get motivated by mortgage interest rates creeping up this summer.
“When we see an uptick in interest rates, people start to get that feeling that they might have missed the bottom of the market — which they have already. But sometimes fear is an important factor in buying property,” she said. “The interest rates are still very, very good, and people who want to buy a home, if they can, should be out there trying to buy.”
The low rates and tight supply also have lured buyers back into the first time home buyer market. Because of the purchase power these low rates have afforded first time homebuyers in NC, the hike in rates is likely to serve as an additional motivating factor for drawing buyers into the market.
If you are for your First Home, there are some basics we think you should consider as you are starting the process to look for a home. Here are FIVE THINGS we think every First Time Home Buyer should consider before making that move:
- When you buy a House – you get a Raise! Uncle Sam definitely sees benefits in having homeowners, so you get to “write off” the interest you pay each month on your taxes! We advise First Time Home Buyers to see a tax professional, and consider changing your W-4 when you purchase! This way, instead of the government giving you a $2400 refund… you get a $200 RAISE! (seriously, you can bring home more each month and not owe on April 15!)! We also offer the MCC | Mortgage Credit Certificate for those who qualify. This program actually DOES change your W-4, but it does not diminish the tax credit that you can write off each Spring. It’s an ADDITIONAL Tax Credit available for those who have been renting for the last 3 years in NC.
- You CAN get into a house with absolutely no pennies out of pocket - but it’s HARD. We would suggest that you have at least $1500 if you want to buy a house. There are really 3 buckets that your costs associated with buying the home will fall into.
- Downpayment: Conventional loans and FHA loans have the highest threshold for downpayment, requiring 3.5%. For FHA loans, this money can be a gift, and they allow a family member to co-sign with you to buy the house (without them having to live with you). USDA Home loans are available in every county in NC, and they require ZERO downpayment. The payments on this owner occupied program are super low too because USDA has the lowest PMI rates offered, often times saving homeowners $200 a month or more over a FHA loan. Because USDA Home Loans are designed for more rural parts of our state, you just need to be okay with living on the “outskirts” of town. If you have Veteran benefits you will not need any money for a downpayment when you apply for a VA Loan. Even if you’ve used your entitlement, you might still qualify for the program.
- Closing Costs: We can help you structure your contract so that the Seller is paying most of your Closing Costs, the trick is with wording the Seller Concessions correctly for the Underwriters. There are some of these fees that the Seller “can’t” pay, or won’t pay. You should be prepared to pay for the Inspection of the home, you will have to pay for your Home Owners Insurance, and your part of the taxes. Depending on what time of year you are closing, you could need as few as 4 months of taxes, or as many as 9. So there’s no way for me to give you an exact figure. We, as the Lender can also absorb some of your closing costs with the mortgage loan. There are other sources for help with closing costs and down payment. We offer the NC Affordable Housing Agency Program. Those who qualify can receive up to a 3% Grant! This money can be used towards your Down payment, or your closing costs, has no monthly payments, and is forgivable over time. It is designed to help folks who have been renting for the last three years.
- The Actual Move: You are going to want to have some cash to turn on appliances, buy a refrigerator (if you don’t negotiate one) and maybe buy some new shelf paper. Yeah, you could charge part of this – but having a “little” nest egg so that you can buy beer and pizza for the guys that help you actually move everything to your new place is a great idea. Having an amount equal to 2 house payments after you close on your home is the minimum we suggest. But if you are super tight on cash, don’t get too worked up … you skip a payment when you buy a house! When you buy a house, let’s say you close on June 25th – you pay interest at closing from June 25th thru June 30th. You live in your home during the month of July- and your first payment isn’t until AUGUST! Woot! Woot!
- Go ahead and meet with us (your Lender) EARLY in the process! Let us peek at your credit, look at your paystubs and give you an honest assessment about your decision to purchase! You might think you have to wait 6 months – and we might be able to tell you NOW is the time! Even if it IS six months – let us talk to you about the taxes, and insurance and the tax benefits! Let us HELP YOU get your credit in order – this is what we do all day, and we don’t charge for that help! (Here are some questions to ask your lender!)
- Use a Real Estate Agent (period). You will NOT get a better deal without one. Do NOT go to a new home Community and think that the sales person there is going to help you get the best deal… get a Real Estate Agent that is working for YOU. That does NOT mean that you have to pay for them – you don’t… but they work on YOUR behalf! (We know some GREAT ONES!) The right Real Estate agent is going to be critical in helping you structure an offer to purchase that is accepted, and for the best terms. Especially now that Real Estate prices are headed up – use an Agent!
- Don’t believe everything you hear on the News! Yes, the real estate market stumbled… IN CALIFORNIA! We live in North Carolina! Housing sales slowed, but it’s started picking back up. There are SOME foreclosed homes available, but we don’t have as many distressed homes here as there are in other parts of the country and the bidding for those homes is fierce. As we said earlier, mortgage interest rates have gone up in the past few weeks, and so have the prices on houses.
The Raleigh and Cary Real Estate market will continue to be a great investment because we have over 20 Colleges and Universities in the area, State Government (the Capitol) and MAJOR World Class Hospitals! Other NC real estate markets will continue to see improvement for the exact same reasons, including Charlotte and Greensboro. As the Economy continues to improve, real estate prices in NC will continue to climb. The time to buy is NOW!
We offer first time home buyer programs through our North Carolina Affordable Housing Agency that provides specific assistance for folks who have been renting for the last three years. The NC First Time Home Buyer program offers:
- allows you to purchase a home with a below market mortgage rates,
- a forgivable grant of up to 3% to cover your down payment or closing costs,
- Low Closing Costs fees and little or no money out of pocket,
- and it can help you qualify for a larger home while providing you with additional Mortgage Tax Credits!
The NC Affordable First Time Homebuyer program changed in May of 2013, and is now open to anyone who has not owned a home as a primary residence within the last three years. This works great for folks who owned a property in another area and moved to find a job. Having that rental property does not mean that you will not qualify for the program as long as you’ve been renting for the last three years.
The NC Affordable Housing Agency Program works in partnership with FHA, VA, USDA and Conventional loans. It’s an additional benefit offered to those who qualify and have been renting in NC. You might qualify for a 3% forgivable government GRANT that will help you buy a home!
So Relax! NC First Time Home Buyer Programs can help you do this! Buying your First Home in NC is FUN! Call Steve and Eleanor Thorne, Best Mortgage Rates in Cary NC, 919-649-5058. Connect with us on Google Plus and Facebook