Washington Home Buying

Maybe you?re buying your first home in Washington, or perhaps you?re relocating to Washington from another state. Either way, it?s important that you educate yourself on Washington home loans before shopping for a home and mortgage. This article explains what you?ll need to know before buying a home in Washington:

The median price of a home in Washington is $168,300. Recently, homes in Washington have been appreciating at rates higher than the national average. Additionally, the rate of job growth in Washington places them 13th in the nation. However, income levels in many parts of Washington are too low to purchase a median-priced home with a conventional loan. In fact, Washington is ranked fifth in the nation based on the number of residents that pay more than the recommended 30% of their incomes on their mortgage.

On the other hand, Washington has one of the lowest past-due loan levels in the nation. Additionally, current average interest rates in Washington are below the national average. The problems with high home-price-to-income ratios may stem from the variability of median home prices between Washington zip codes. For example, in the summer of 2005, the median price of a home in Bellevue, Washington, was $566,000; however, at the same time, the median price of a home in Seattle, Washington, was $386,000, and the median price of a home in Spokane, Washington, was $238,000.

Washington law does allow the disbursement of home equity lines of credit. Additionally, Washington?s Equal Credit Opportunity Act prohibits mortgage lending discrimination against individuals based on their race, color, religion, gender, familial status, or national origin.

Jessica Elliott recommends that you visit Mortgage Lenders Plus.com for more information about Washington Mortgage Rates and Loans.

Is Headline News Making Your Real Estate Decisions

Looking at the headlines for the last four months about housing is really depressing. However I have noticed that the bodies of the articles and the headline are often at odds. This made me wonder how many people make their housing decisions based on the headlines instead of the articles. We are a nation addicted to the quick. A vast number of us get our news from headlines on our home page or CNN. Articles take time to read; we need the condensed version.

One headline in red bold point type is: 31.7% Biggest Drop in CA home Sales 24 years. What you don't find until the second paragraph is that the drop is from September of 2005. Not mentioned is that home sales in 2005 were the highest ever recorded. Also down in the body is that Unsold inventory is holding steady and is close to the long- term historic average of a normal market. So why isn't the headline Market Reaching Historic Average?

Another article headline says: Home Price Fall Sharpest in 35 Years! What you don't get until the third paragraph is that this number ( 9.7%) is for Nationwide sales of new construction. Half way through the article you find that overall prices are down by only 2.5% and sales activity is up for the last two months. You won't see a headline that says Prices Only Drop 2.7% Sales on Rise.

If I were a Buyer or Seller reading all the headlines I'd be leery of this market. Buyers are worried that if they buy the price will drop and they will look silly for buying in a down market. Sellers are concerned that if they sell now prices will go back up and they will look foolish for not waiting until the market changed. People are truly afraid to make a decision about housing. People would rather make a mistake about a spouse then a house!

The Real Estate market has been slow for almost a year. The Bubble bloggers are praying prices drop to 1995 levels but that's not likely to happen. Sellers are waiting for prices to increase 50% and that's not going to happen either. Here is what has happened. Prices have declined and inventory is up with many housing choices. Sellers will negotiate price and terms. Interest rates are very low. 30 year fixed rates for loans less then $417,000 are 5.78% and jumbo fixed rates are 6.1%. This is an amazing market with great financing and lots of choices but people are not buying. So why are people waiting? I think people are afraid. It seems as if the entire country is just waiting for a headline that tells them the slump is over and it?s OK to return to the housing market. No one wants to be wrong, however trying to time a housing market is almost impossible and usually depends on luck more then skill. Often by the time the general public realizes a market has changed it is too late to get in at the right time. So if you are waiting for the headlines to tell you it?s time to buy you might be too late to get that good deal you have been waiting for so patiently.

Kaye Thomas is a UCLA graduate and has been selling real estate in Manhattan Beach Ca since 1979. Kaye works with buyers and sellers and specializes in residential and small residential income property in the South Bay Beach Cities of Los Angeles county. For more information on buying or selling visit Kaye at Kaye Thomas 4 Homes or Move2ManhattanBeach

or read her BLOG at Manhattan Beach and South Bay Real Estate Information You can e-mail Kaye with questions at: Kaye Thomas

Home Ownership in Palo Alto California

Trying to buy a home in Palo Alto California is a lot like looking for a needle in a haystack. That's because Palo Alto homes are in great demand, and there are a lot of potential buyers. The challenge is that few people can afford a home in Palo Alto. To overcome this, you have to be willing to make some sacrifices to find a home that you want.

First, choose your price range. Palo Alto is known for its wonderful schools, proximity to Stanford University, and easy access to major freeways and transit lines. While there are many expensive homes in Palo Alto, there are also numerous less expensive homes as well, homes that may need some work but can provide the basis for a wonderful living experience.

To find a home that will meet your needs, you may have to wait a while, but no wait will go un-rewarded. That's because Palo Alto has so many unique homes, and by unique, we mean that these houses will not work for everyone. Some houses aren't setup right for today's modern families, while other houses just don't have a workable layout.

One thing you should not compromise on is location. There are many neighborhoods in Palo Alto and one way to become familiar with them is to spend time on weekends either driving or walking around these neighborgoods. By doing this, you can find neighborhoods with likely future home purchase candidates; these are homes that have something wrong with them other than location - they need work, the yards are over-grown, the insides are outdated, and so on. If you can find a bunch of these houses, you then develop a strategy of waiting for one of these houses to go on the market. Once one of them does, you proceed to make an offer. This strategy may take patience, but it's worth the wait, because owning a home in Palo Alto is a truly wonderful experience.

Amy Morris writes for the home ownership community site http://www.homeownershiponline.com, which has an active community for Palo Alto homeowners.

Buying Your First Home?

You?ve finally decided to take the plunge and buy your first home. While the journey may feel terrifying and confusing, there are some basic steps you can?and should?take before hitting the pavement in search of your future home. Instead of feeling overwhelmed you can arm yourself with the knowledge you?ll need to make informed decisions as you begin your path to home ownership.

Becoming educated in the common practices in your area is the absolutely number one objective on your list. Pick up the phone and call local real estate agents, bank loan officers, and mortgage brokers. Be warned, some will attempt to coerce you into making an appointment?this is not necessary at this stage?and is their way of getting you to sign an agreement you are not ready to sign. Explain clearly that you are in research mode only and need no more than 15 minutes of their time to get your questions answered. It?s important to talk to several professionals as different perspectives and viewpoints will give you a broader spectrum of information in which to base your decisions on.

What to ask

1.Find out what disclosures (facts that materially affect the value of the property) the seller is required by your state to disclose. This varies state to state, so it is extremely important you know what your state laws mandate. Realize that in most cases, the seller is only required to disclose information he/she already knows about the property. What this means is the seller is not obligated to hire professionals, but is required to disclose in ?good faith? any personal knowledge on the property which may affect its financial worth.

2.Ask about standard home inspections. A standard home inspection will give you information on the physical structure itself and the systems inside the home. You need to know what the average cost is in your state, who usually pays for it, and when it is commonly done. Most standard home inspections are paid for by the buyer, but sometimes the seller will split the costs. If you?re in a repressed market or the homeowner is anxious to sell, he may pay for the inspection fully.

3.A title search will have to be performed to rule out any issues with the deed of the property. Who conducts this search and what is the average cost?

4. What are other potential costs you should be aware of? Taxes, settlement agent fees, and commissions are just a few of the ?other? costs you should ask about.

5.It?s also a good idea to find out the average amount of time it takes for a loan to close once an offer has been accepted. This can, and will, vary, because often it has more to do with the personal preferences of the buyer and/or the seller. Be aware of potential time sinks before you begin your search.

6.If you do choose to use a real estate agent to assist you in locating your future home, find out if they?ll help you compose an offer when you?re ready to make one. If they use a standard form, find out if you can get a copy for your own reference. Always be informed on what the agent is giving to the seller.

What?s next?

Get a copy of your credit report, from several sources if possible, and make sure it is correct. If there is incorrect information on your credit report, contact the reporting credit agency and ask for a dispute form. Once you receive the form, fill it out and send it back certified with return receipt requested. When applying for loans your credit score will be the determining factor in getting you the lowest percentage interest rate possible. Make sure the information is factual and then work with what you have. A low score does not mean you can?t buy a house. If this is a concern of yours, find out what programs are available for less than perfect credit.

How much can you afford? You may already know this, but if you don?t, figure it out. The standard rule is your mortgage payment, taxes, and homeowners insurance shouldn?t be more than 28% of your gross income. However, this still may be too much, depending on your other financial obligations. Be honest with yourself and what you can afford to pay out each month. Consider any possible extra costs with home ownership; i.e. new appliances, new carpet, landscaping, and normal home maintenance. Don?t dig yourself into a financial hole you may not be able to get out of.

What type of loan should you get? This is not an easy question to answer, and the best course of action is more research. There are multiple mortgage internet sites you can start with to educate yourself on the types of loans available. In fact, you should definitely pick up the phone once again to make sure you completely understand the loans you are considering. Mortgage brokers and bank loan officers want your business?they will be more than happy to answer your questions and even send you specific loan information.

With this basic, yet important, information at your disposal; you are ready to begin the search for your future home. Always remember that knowledge is key in every aspect of purchasing a home, do not be hesitate in getting the facts you need in any area of the process. Ask questions, be informed, and you will arrive at the other end the confident owner of a new home.

? Copyright: Tracy Leigh Ritts
http://www.TracyLeighWrites.com

Interest Rate Buydowns What Is Old Is New Again

Whenever you hear about buydown loans again, it?s a sure sign interest rates have risen and the real estate market has slowed down.

A buydown occurs when the interest rate is ?bought down?, that is, with cash to pay for a lower interest rate known as a permanent buydown or ?borrowed? into the future with a higher base interest rate as in a temporary buydown. The lower interest rate, the lower the monthly payment and loan qualifying is easier. Conversely, the lower the interest rate the more it costs.

The permanent buydown buys the rate down for the life of the loan. Typically it costs one point or one percent of the loan amount to buy it down a quarter of a percent in rate. If the current rate is 6.50% for example, you can buy it down to 6.25% for about one point.

A temporary buydown is for a short, set period of time. A 2-1 buydown is most common where the initial interest rate is two percent below the base note rate for the first year and then 1 percent below the base for the second year, finalizing at the base note rate for the remainder of the term. An example would be a base note rate of 7.50% with the first year at 5.50%, the second at 6.50% ending with 7.50% for the remaining 28 years on a 30 year loan.

It can be bought down with cash and/or a higher base interest rate with revenue called a Yield Spread Premium, also known as YSP, rebate or premium pricing. Think of it as leveraging tomorrow?s higher interest rate to gain a lower one today.

Why is this important to you as a seller? It increases your pool of qualified buyers for your home. It costs you between one to three points but it is part of dealing with a slow market; either lower the price of your home or give more incentives. It is a widely used tactic by new home builders when the market softens.

Why is this important to you as a buyer? The buydown subsidizes your monthly payments to allow time for your income to catch up to the yearly increase of approximately 7.5% above the previous year?s payment. You can buy the home you want today rather than wait, or worse, buy a lesser home you really didn?t want. You get the added fixed rate security benefit knowing exactly what your monthly payment is at any time, unlike an adjustable rate mortgage. Structured correctly, you benefit at the seller?s expense.

Why is a permanent buydown not a good option on a purchase? One main purpose of the buydown is to get more people to qualify for more home. Three point cost only drops the interest rate about ? of one percent, the permanent rate of 6.50% lowers down to 5.75% for example. A temporary buydown using the same scenario would lower the first year?s interest down to 4.50% percent, a full two percent below. It also lowers the monthly payment substantially below the ? of one percent rate drop.

There are different buydown variations to discuss with your mortgage consultant if you are a buyer or a seller. The 3-2-1 buydown works on the same premise of the 2-1 only over a three year period. A ?flex-fixed? buydown has incremental increases every six months. Structuring depends on your credit score and how much you are putting down.

If you are a seller, a seasoned mortgage consultant will structure the buydown so it doesn?t cost you as much yet broadens the market appeal of your home. It becomes a powerful marketing tool for your real estate agent to sell your home sold faster. This mortgage consultant will also structure the purchase of your new home based on your projected net proceeds to make both transactions smooth and tailored to fit you.

For you the buyer, a buydown is a valuable financing option added to your mortgage arsenal. The buydown and the cost need to be structured into your formal offer to purchase contract. It broadens the number of homes you qualify for and if structured correctly, you benefit from a lower initial monthly payment and interest rate, at the seller?s expense. By the time the interest rate hits the higher base rate; you will be in a position of handling the higher monthly payment with your increased future income if the rates remain high and/or to refinance if rates drop.

Your mortgage consultant will explain the program, the payments and cost in detail in terms you can understand; what it means to you today and over time. Insist on a side-by-side mortgage analysis in writing from mortgage software such as The Mortgage Coach, LoanMagic or a similar mortgage analytical product. If they can?t, you need to find another lender.

Vic Yamauchi, a San Diego native, started his real estate career in 1978 as a Regional Real Estate Manager for Pier 1 Imports after graduating from San Diego State University.

A Realtor in 1980, he learned the business the hard way as home interest rates climbed to over 19% and became well versed in creative financing that has served him to this day. He listed up to 25 homes in one month. He is celebrating his 28th year overall in the real estate and mortgage industry.

Vic has been an owner or co-owner of four different mortgage companies since that time. He was SVP of Retail Production, AME Financial and a past Branch Manager for Norwest/Wells Fargo Home Mortgage.

Currently, Vic is a senior mortgage consultant with CalPacific Mortgage Consultants, http://www.capmc.com, and President of Homebuyers Resource Center, http://www.mlsrec.com.

The Local Community

Whether you?re buying a residential house for investment purposes or as your home, the local neighborhood and community where it is located will make a big difference in your enjoyment of that property and in your prospects for the future. Here are some of the basic things to look for:

1. Essential Shops and Services

Are all the essential shops and services in the area and are they you?re your house? Drive around and look for the local grocery, convenience stores, church, gas stations, dry cleaners and the like. While you?re at it, take a good look at the community?s leading shopping center. Oftentimes, if the local shopping center is in decline, chances are that the neighborhood is in decline as well. In addition, if there are a lot of vacant storefronts along that neighborhood, it might be a good idea to explore other options, perhaps go down a street or two for your house hunting.

2. Proximity to neighborhood center You want your home to be neatly tucked away at the center of the residential neighborhood or as close to it as possible. You do not want to purchase a house on the edge of town or close to its outskirts. And neither do you want a house that is at the back or side of a busy thoroughfare either. If it?s a single family residence you are eyeing, try to avoid purchasing property that borders a bustling business enterprise, condominium, apartment complex or school because these places are naturally bustling with activity which can be a distraction.

3. Access to major thoroughfares The ideal property provides easy access to local highways, major traffic routes and major thoroughfares as well as to mass transit. Try to avoid purchasing a house located on a street that is a favorite shortcut of motorists between two busier streets. If it?s a residential home you?re thinking of buying, also avoid a house located at a corner lot since these tend to attract more street traffic and may not be that safe for children. Instead, try to find a house that is in the middle of the block or on a cul de sac. Now if it?s a business or commercial property you are eyeing, a corner lot would be more desirable.

Jonathon Hardcastle writes articles on many topics including Real Estate, Investing, and Finance