Market Mixed for First-Time Buyers

(Source: Mortgage Capital Associates)

Market conditions are mixed for first time buyers who traditionally purchase nearly half of the homes for sale. They are not stymied by lost equity of an existing home that keeps others sitting on the sidelines. Yet they face stiff competition from cash flushed investors and bidders with bigger down payments who are scooping up available inventory.

There is plenty of incentive to press forward for the first-time buyer. The inventory of foreclosures and stressed properties is still significant. New construction is picking up in some regions of the country. Rents are on a steady incline. According to a recent study, it is cheaper to own in 98 of 100 top metro areas. For a buyer determined to make the transition from renter to owner their dream can become a reality in today’s market.

Best advise, get prequalified before you head out to make an offer. Rates are low right now and holding steady, but getting a loan can be difficult. It is well worth the time and effort to optimize your creditworthiness by paying down unsecured debt, delay purchasing a new car and forego impulse buys. Aggressively save toward your down payment. Do your research. Study your loan application to reveal any unforeseen issues.

Now you are ready to secure the best rates, lowest points, and most affordable closing costs. It may take longer and require more effort to find the best mortgage loan in today’s market. Considering a FHA loan option? You might face the toughest challenge. In today’s market FHA buyers with low down payments are being pushed aside. On the seller’s side, FHA loans often require more home repairs before closing, making these offers less attractive. Look at your options to secure a conventional loan to strengthen your offer.

Getting prequalified will significantly boost your ability to make a strong offer on that new home. Your goal is to make your offer as streamlined as possible for the seller. Capture the deal you want by being prepared.

The market is ripe for first time buyers despite tight credit and an uncertain economy. Ask yourself, “Is it the right time for me to buy a home?” If the answer is yes, visit our website to learn the requirements for completing your loan application. Mortgage Capital Associates can help you make informed decisions about your home loan options.