5 Questions for The First-Time Home Buyer

Usually, a first-time homebuyer picks out a house before lining up financing, but it should actually be the opposite. Buyers often call a Realtor first and then the Realtor refers them to a mortgage person. Realtors are there to guide first-time homebuyers through the entire process. This can start by providing names of reputable lenders with a proven track record that you can individually interview to find out which mortgage lender and which loan product is going to be the right one for you.

Before you actually set your sights on viewing properties, sit down have a long hard look at the pros and cons of homeownership as well as your current financial situation. Establish what you feel you could afford based on your budget.

Ask yourself these five questions then contact a Realtor and / or Lender:

1) How much can I afford?

It may be hard to figure out how much you can truly afford. The very best ratio to have is one-fourth of your income going toward house payments. This means net income, or 25 percent of what you earn after taxes -- lenders calculate using gross income. "Anywhere between 25 (percent) and 32 (percent) is safe. Anything over 35 (percent) is the danger zone.
A higher ratio puts you at risk if anything changes. Insurance or tax rates can increase, putting you over your monthly budget. Then there is the prospect of job loss. With 25 percent, even with the loss of one income, you can still keep your home,
You should essentially know your financial situation before you approach a lender and borrow accordingly. A 30-year fixed mortgage is preferable. Chart out how high your payments would be at different rates by using a mortgage calculator. You'll find one at:  www.sandiego-ca-homes.com. Once you've determined your monthly principal and interest, factor in taxes, insurance and any HOA/Condo fees and special assessments that may apply such as Mello-Roos, as well as utilities.
Once you know what you can afford to pay on the mortgage, you can figure out your housing price range.

2) What are my costs outside of the loan?

First-timers tend to miscalculate the total tab for sealing the purchase and the cost of maintaining a home.Have a thorough conversation about down payment costs and closing costs, You need to know the total out-of-pocket costs. Next, make sure you consider all the monthly charges.
If you're buying a fixer-upper, get several contractor bids so you know what lies ahead.
You always have to be prepared, new or old, to make any repairs, If your mortgage is at 25 percent of income, repairs can bring your cost to 30 percent. We always say you should have three months of basic living expenses in a very liquid place, and part of that is your house emergency fund," Cecere says. Finally, double-check utilities and tax costs to avoid nasty surprises.


3) What do I need in a neighborhood?

I always sit down and say, 'Give me your wish list,' What are the must-haves?"
Your particular lifestyle is key. What do you do when you come home?" That can help you determine whether proximity to a gym, park or good restaurants matters.
I urge buyers to consider how they will get from home to other places. Walking three blocks to a bus stop when it's 90 degrees can be less refreshing in the blistering heat. If you drive, try out the route before you buy. Check out potential neighborhoods at different times of day,
Sure, look at the MLS, see the reports, but walk the neighborhood.

4) Will this house fit my long-term goals?

While you have to make a purchasing decision based on your current financial situation, you should imagine your future personal and work life. Are you going to grow your family? and How many bedrooms do you need? If you think an elderly parent may move in or you'll need a home office, include that in your decision. Don't forget about schools. Sometimes, paying more for a house can be cheaper in the long run. A pricier home in a better school district can be cheaper than a lower-priced home plus private school for 13 years. This home will let us go for public school and not pay $50,000 for private school, may be the better course of thought.

5) Am I prepared to be a homeowner?

Whatever your money attitude is, when you have a home, a lot of your money will go (to it), A lot of your time will be spent dealing with your home. Make sure you understand what's involved. You should ask yourself before buying if you have good spending habits.
If you're ready and buy responsibly,  homebuying can absolutely be a wise financial move. Owning a house is still better than renting, and you should absolutely be able to find a great house for what you can afford.

Call me if you would like to get started. You can reach me at 858-603-7879 or email me at robert@sangiego-ca-homes.com

Who Pays What? A Closer Look at Closing Costs

Who pays closing costs when buying a home? Does the buyer pay everything, or do the costs get divided between buyer and seller? Is it negotiable? These are some of the costs that are "customarily" borne by Buyer and Seller during a residential real estate transaction in San Diego. Take a look...


The BUYER Can Generally Be
Expected To Pay For:
•   "Lender's" title insurance policy premium
•   Escrow fee
•   Document preparation (if applicable)
•   Notary fees
•   Recording charges for all documents in buyer's name
•   Termite inspection (defined by contract)
•   Tax proration (from date of acquisition)
•   All new loan charges (except those required by lender for seller to pay)
•   Interest on new loan from date of funding to 30 days prior to first payment date
•   Assumption or change of records fee for takeover of existing loan
•   Beneficiary statement fee for assumption of existing loan
•   Inspection fees (roofing, property inspection, geological, etc.)
•   Home warranty (defined by contract)
•   City transfer or conveyance tax (defined by contract)
•   Fire insurance premium for the first year
•   Messenger fees (if applicable)

The SELLER Can Generally Be
Expected To Pay For:
•   "Owner'sn title insurance policy premium
•   Escrow fee
•   Real estate commission
•   Document preparation fee for deed
•   Documentary transfer tax (typically $1.10 per $1,000.00 of sale price)
•   City transfer or conveyance tax (defined by contract)
•   Any loan fees required by buyer's lender (FHV,VA)
•   Payoff all loans in seller's name (or existing loan balance if being assumed by buyer)
•   Interest accrued to lender being paid off, statement fees, reconveyance fees and prepayment penalties
•   Termite work (defined by contract)
•   Home warranty (defined by contract)
•   Any judgments, tax liens, etc., against the seller
•   Tax proration (for any taxes unpaid at time of transfer of title)
•   Any unpaid homeowners dues
•   Recording charges to clear all documents of record against seller
•   Any bonds or assessments (defined by contract)
•   Any and all delinquent taxes
•   Notary fees
•   Homeowners transfer fee
•   Messenger fees (if applicable)

Please Note: The above-listed Seller and Buyer closing costs are negotiable in any transaction
and are defined by the Contract between the two parties.

Call or email me with any questions you may have: 858-603-7879 or robertmoore@coldwellbanker.com

National Geographic Channel Selects San Diego As One of World's Smart Cities- April 25 and May 2 @ 8am

Tune in Saturday morning on April 25 or May 2 @ 8am to see how San Diego is presented to be one of National Geographic Channel's chosen cities for the filming of the documentary series "World Smart Cities." This unprecedented exploration of the world's cities seeks to showcase destinations where technology, talent and innovation are creating new urban environments that will emerge as leading cities in the 21st century.

Thanks to a strong technology sector, local innovators, green practices, smart public planning and an unparalleled quality of life, San Diego is the only U.S. city to be featured in this documentary series that will air in 20+ countries in 2015.

National Geographic's "World Smart Cities" crew captures the spirit of San Diego.

From now through Oct. 23, National Geographic Channel is filming San Diego's best and brightest, including:

• Environmental innovation at San Diego Gas & Electric's Smart Grid.
• The Port of San Diego and how it has become a leader in environmental issues with its new shore-power system at the Tenth Avenue Marine Terminal.
• The environmental protection efforts of SeaWorld San Diego, which has rescued and helped over 22,000 marine animals, along with SeaWorld's ground-breaking research studies in marine animal science.
• How San Diego attracts innovation and talent, highlighting the work being done by J. Craig Venter with human genome sequencing.
• UC San Diego's San Diego Center for Algae Biotechnology, which engineers algae for the production of hydrocarbon molecules that can be used as biofuels.
• The innovation in yeast cultivation done by San Diego-based White Labs, highlighting San Diego's dynamic craft beer scene.
• Illumina, recognized as "One of the 50 Smartest Businesses in the World."
• Northrop Gumman's work with Unmanned Aerial Vehicles for NASA which are involved with climate change measurements.
• The New San Diego Central Library, its stunning architecture and dynamic public art.
• San Diego's active lifestyle and action sports culture. Surf legend Rob Machado will share the work of his foundation, which helps provide clean drinking water and engages disadvantaged youth in healthy lifestyle activities.
• San Diego's spirit, as defined by our cultural roots, from ethnography to gastronomy.

Host Andrew Evans learns about San Diego's culture and cuisine from chef Su-Mei Yu.

Broadcast will begin in spring 2015 in approximately 25 different countries, including the United States, Austria, the United Kingdom, Switzerland, Japan, France, Korea, Italy, Australia, Russia, New Zealand, Spain, China, Brazil and more.
The 50-minute San Diego episode is expected to reach more than 150 million international households and approximately 85 million U.S. households, providing record exposure for the city as a leading business and travel destination.

FUNDING PARTNERS

The following organizations have provided funding for the filming of National Geographic Channel's "World's Smart Cities: San Diego":

• City of San Diego
• County of San Diego
• San Diego Tourism Authority
• San Diego Tourism Marketing District
• San Diego Regional Economic Development Corporation
• Port of San Diego
• San Diego County Regional Airport Authority
• SeaWorld San Diego
• Sempra Energy
• University of California, San Diego
• Legler Benbough Foundation
• Malin Burnham
• The San Diego Foundation
• Qualcomm

When in Hillcrest

When in Hillcrest viewing homes, be sure to lunch at Bread & Cie. This open airy cafe/bakery/bistro offers a vast array of bread or pastries, croissants and sweet baked goods, fresh sandwiches and coffees. Busy but not uncomfortably crowded. I am sipping on a cappuccino, munching on flute-style baguette, with a side of San Pellegrino - $13.00 and some change. Clients are ready to resume-four more properties lined up for this pm.

When in La Jolla

When in La Jolla, sauntering along Coastal Blvd., be sure to drop in at Gelateria Frizzante. Great gelatos, caffe and other beverages. Excellent, cool, clean place to rest and get recharged while in La Jolla - picolo gelato (2 flavors and a cappuccino just $6.75.

San Diego Home Affordability Still Riding The Wave

Over the last three years, sellers were more than pleased to see that homes were selling for a total of 25 percent more than three years before, according to the S&P/Case Shiller Index. Sellers were pleased; buyers not so much.

So far in 2015, slower gains for San Diego sellers have helped to make home affordability a more positive factor.

Sellers are still going to net more from a home sale than they would have in recent years.

But these same sellers, those who recently decided to trade up or move to a smaller place, are still doing buyers a big favor.

It's a lovely circle.  San Diego prices have been going up, which makes some sell, and that puts more choice homes on the market, which makes others want to buy. Even with the extremely tight resale inventory in San Diego, slight increases of great homes, combined with higher price levels result in prices becoming more settled and more of a balance plays out.

Real estate agents may be more likely to make recommendations that meet all the buyer's wants, instead of just a few.

Experts say it is too soon to calculate San Diego County affordability for this year, but if you buy a home in San Diego today it will definitely be more affordable than a year from now.

Quoted in The Wall Street Journal, Bill McBride, who writes the popular Calculated Risk blog, reminds us that in the existing housing market, active inventory may influence pricing somewhat, but it also influences sales. 

McBride says that in 2014, home sales were just so-so, mainly because inventories remained low. 

Mortgage interest rates for 30-year instruments have drifted back to about 4 percent or less in some areas. Some economists, however, say rates will rise beginning in June or July of this year.

According to Greater San Diego Association of REALTORS®, median sales price of existing homes rose 9 percent in 2014, with sales picking up at the end of the year. The prices of previously owned homes sold in San Diego County rose by 9 percent during 2014 , according to new housing statistics from the Greater San Diego Association of REALTORS® (SDAR).

While not as dramatic as the 20-percent rise in prices the previous year, the increase is a healthy sign for the local housing market. The 2014 median price of single-family homes increased to $495,000, while the price of condos and townhomes reached $325,000.Though the single-family home price in September and October was actually higher, weighing in at $510,000 and $500,000 respectively.

Sales increased in December compared to November. Single-family home sales jumped 11 percent, and condos/townhome sales were up 5 percent. For the year, however, total sales were 12 percent lower than 2013.
Active listings on the Multiple Listing Service (MLS) in San Diego County have been on the decline, and are now less than 6,000, about the same as one year ago, representing about 2.5 months of housing stock. (Five to six months is considered a healthy inventory level.) On average in 2014, homes were selling within 45 days of their list date.
As homeowners recapture more of their previously lost equity with home values rising to healthy levels, San Diegans will see more homes on the market this year, which will allow for the natural shifts to take place in the housing market. The projected increase in interest rates should boost inventory levels and drive sales.

We live in a wonderful coastal area with an outstanding climate. San Diego truly is one of the most beautiful places on earth. People want to live here and those who do are very fortunate.

In December, the zip codes in San Diego County with the most single-family sales were:

• 92157 (Oceanside) with 49
• 92114 (Encanto) with 43
• 92127 (Rancho Bernardo) with 42
• 92028 (Fallbrook) with 42
• 92009 (Carlsbad) with 40

The most expensive listing sold in the county last month was a 3-bedroom 3-bath, 2,500-square-foot beach home in Solana Beach that sold for $8.75 million.

Should We Get A Mortgage Now Or Wait for Interest Rates to Fall?

Interest rates on the 30-year fixed-rate mortgage change all the time, so today's rate probably isn't the same as last month's or next month's - in fact, it isn't.

If you've found the home you want, you might as well take the plunge. On January 3, 2014, the average interest rate for a 30-year fixed-rate mortgage was 4.63 percent nationwide. By October 17, the rate fell to 4.03 percent and remained there for a week or more. It was the lowest level since June 2013 according to the mortgage-information website HSH.com.  Demand for home loans surged, but the increase was driven by homeowners seeking to refinance existing mortgages.  Today’s purchase rates are even lower.
Here's what's behind the lower home loan rates:
Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result. The chart below shows Mortgage Backed Securities (MBS), which are the type of Bond on which home loan rates are based.

When you see these Bond prices moving higher, it means home loan rates are improving—and when they are moving lower, home loan rates are getting worse.

To go one step further—a red "candle" means that MBS worsened during the day, while a green "candle" means MBS improved during the day. Depending on how dramatic the changes were on any given day, this can cause rate changes throughout the day, as well as on the rate sheets we start with each morning.

As you can see in the chart below, Mortgage Bonds have been trending higher. Home loan rates remain near record lows

Chart: Fannie Mae 3.5% Mortgage Bond (Friday January 9, 2015)



When interest rates drop, here's how to take advantage of them: First, figure out what the best rates are in your area. The gap between the lowest and the highest rate a mortgage applicant is offered averages about 0.30 percentage points, according to mortgage lenders. On a $400,000, 30-year fixed-interest rate loan at 4.03 percent, borrowers will pay $145,000 in interest over the first 10 years of the loan and $289,969 in interest over the life of the loan. Calculating: With a 3.73 percent interest rate, borrowers will pay $11,464 less in the first 10 years and $24,717 less over 30 years. Following the $400,000 example, a person with a FICO score higher than 740 on a scale that ranges from 300 to 850, who is paying 20 percent down, could get a mortgage at 3.75 percent interest from an online lender or 4.07 percent from local lenders. Some banks charge less if you have a savings account or brokerage account with them. Once you find a rate that appeals to you, figure out how much you'll pay per month and whether that amount is manageable.

For more mortgage info, please contact me. I work with different in-house lenders who can help you become (pre) approved and ready to move.  858-603-7879 OR  robert@sandiego-ca-homes.com
 
www.rmsandiegohomes.listingbook.com / www.sandiego-ca-homes.com


BR/
Robert Moore
 

 

 

Hillcrest Living

Considered San Diego's first suburb, Hillcrest is two miles north of downtown San Diego, home to approx. 36,000 residents and brimming with trendy shops and cafes. Restaurants of almost every ethnic specialty are located here.

2007 marked the neighborhood's centennial, 100 years after William Wesley Whitson purchased the 40 acres north of University Ave to Lewis Street (between First and Sixth Ave) in 1906 for $115,000 that were to become today's Hillcrest.

Known for its "tolerance and acceptance, Hillcrest has a high population density compared to many other neighborhoods in San Diego, and it has a large and active lesbian, gay, bisexual and transgender community.
Hillcrest is part of the Uptown community planning area, which consists of the neighborhoods of Mission Hills, Hillcrest, Bankers Hill, Park West, and University Heights.

The older neighborhood has undergone gentrification, which in recent years, has made it appealing to people seeking a more central urban setting without being in the center of the downtown. Many Hillcrest streets are lined with trees and homes of different architectural types. There are Craftsman homes and Mid-century modern apartment buildings. Zoning is mixed, so you'll find single-family residences, apartment communities, and other multi-family dwelling types all on one street.

The neighborhood is bound by Mission Hills to the northwest, Bankers Hill and Balboa Park to the south, University Heights to the north, and North Park to the east. A large ridge overlooking San Diego Bay borders the neighborhood to the west.

Hillcrest loves to celebrate, each weekend, the local cafes, restaurants and bars fill up for fun and entertainment. Hillcrest "CityFest" is an annual street festival which features food, live entertainment, a beer garden and street vendors. Other regular events in Hillcrest include a weekly farmers market on the grounds of the local Department of Motor Vehicles, a Book Fair and Mardi Gras.

San Diego Pride is an annual celebration each July for the lesbian, gay, bisexual and transgender (LGBT) community. It features the Pride Parade on a Saturday morning, preceded by the Hillcrest Block Party on Friday night and followed by a two-day festival in Balboa Park. It is sponsored by San Diego LGBT Pride and is considered to be the largest civic event in the city of San Diego. The large rainbow flag approved in May 2012 was erected in time for the 2012 Pride Festival.

The Hillcrest Farmers Market currently consists of 175 vendors offering a wide variety of locally grown in-season fruit, produce, gifts, arts and crafts, and flowers. On any given Sunday we have about 175 of our vendors. Many of the local farmers participating in the market grow their produce organically or with no pesticides. The market also hosts a large variety of prepared food and hot food items with an emphasis on international cuisine. Additionally, each week, there are a large number of arts and crafts vendors participating, as well as weekly entertainment performed by Shawn Rohlf and the 7th Day Buskers, a local folk band (additional bands play weekly, check out the heart of the market to see who’s playing).

Hillcrest offers residential neighborhoods with great walkability to shopping, entertainment, as well as public transportation. Its centrality to freeways and downtown make for practical easy-access living.
For more information on Hillcrest and other Uptown neighborhoods, call me at 858-603-7879. www.sandiego-ca-homes.com
BR/
RM

5 Tips for Buying a Home

Looking to buy a home? Here are five essential tips for making the process as smooth as possible.

Get your finances in order.
Start by getting a full picture of your credit. Obtain copies of your credit report. Make sure the facts are correct, and fix any problems you find. Next, find a suitable lender and get pre-approved for a loan. This will put you in a better position to make a serious offer when you do find the right house.
Find a house you can afford.
As with engagement rings, there’s a general rule of thumb when it comes to buying a home: two-and-a-half times your annual salary. There are also a number of tools and calculators online that can help you understand how your income, debt, and expenses affect what you can afford. Don’t forget, too, that there are lots of considerations beyond the sticker price, including property taxes, energy costs, etc.
Hire a professional.
While the Internet gives buyers unprecedented access to home listings and resources, many aspects of the buying process require a level of expertise you can’t pick up from surfing the web. That’s why you’re better off using a professional agent than going it alone. If possible, recruit an exclusive buyer agent, who will have your interests at heart and can help you with strategies during the bidding process.
Do your homework.
Before making a bid, do some research to determine the state of the market at large. Is it more favorable for sellers or buyers? Next, look at sales trends of similar homes in the area or neighborhood. Look at prices for the last few months. Come up with an asking price that’s competitive, but also realistic. Otherwise, you may end up ticking off your seller.
Think long term.
Obviously, you shouldn’t buy unless you’re sure you’ll be staying put for at least a few years. Beyond that, you should buy in a neighborhood with good schools. Whether you have children or not, this will have an impact on your new home’s resale value down the line. When it comes to the house itself, you should hire your own home inspector, who can point out potential problems that could require costly repairs in the future.

Buyers Beware: Ensure That Your Agents Are Using The Newly Revised Residential Purchase Agreement

Buyers, this may come as a surprise to some agents: The CALIFORNIA ASSOCIATION OF REALTORS® Residential Purchase Agreement (RPA) has been revised as of November 2014. The 2014 RPA is 10 pages long and contains 32 paragraphs and approx. 150 lettered paragraphs, some of which have been relocated within the RPA. The revisions encompass newly written/introduced or modified language in the Agreement. Please check with your agents to ensure that they are using the correct version of the Residential Purchase Agreement and attendant forms when submitting your offer. For more information on this subject, please feel free to call me at 858-603-7879 or email me at robert@sandiego-ca-homes.com

www.sandiego-ca-homes.com.

                                              BR/RM

La Jolla - "The Gem of San Diego"

Just 12 miles north of Downtown San Diego, La Jolla, Spanish for "the gem or jewel," is an affluent seaside community with 7 miles of dramatically varying coastline...

                           

La Jolla

Coinciding with the admission of California to the United States and the chartering of San Diego as a city, La Jolla was incorporated as part of San Diego in 1850. Just 12 miles north of Downtown San Diego, La Jolla, Spanish for "the gem or jewel," is an affluent seaside community with 7 miles of dramatically varying coastline. Ocean bluffs to the north drop abruptly to the sandy beaches below which, in turn, hug the bases of the rugged cliffs. La Jolla Shores offers prime sandy beaches for tanning and relaxing and further south, a combination of sandy coves and rocky shoreline are host to several sea lion harems, as well as snorkelers and myriads of tourists who come from all over the world to admire the charm of La Jolla's unique coastline.

  La Jolla is also a mini Mecca for education, research, culture and recreation: It is home to the University of California, San Diego, the San Diego Supercomputer Center, Scripps Institute of Oceanography, the Museum of Contemporary Art and the Birch Aquarium and Museum. Want some outdoor fun in the sun? La Jolla boasts an array of outdoor activities such as paragliding at the Torrey Pines Gliderport, or strolling the miles of sandy beach coastline. The world-famous Torrey Pines Golf Course is a golfer's paradise. Snorkel at La Jolla Cove, surf at Black's Beach or hike endless coastal trails. Tie in a bit of recreational shopping and saunter down Prospect Street, La Jolla's main drag through the quaint town center, where you will find magnificent retail shops and fine dining. La Jolla is not only known for its fine dining and upscale shopping but also for its luxury homes.

 La Jolla is also a mini Mecca for education, research, culture and recreation: It is home to the University of California, San Diego, the San Diego Supercomputer Center, Scripps Institute of Oceanography, the Museum of Contemporary Art and the Birch Aquarium and Museum. Want some outdoor fun in the sun? La Jolla boasts an array of outdoor activities such as paragliding at the Torrey Pines Gliderport, or strolling the miles of sandy beach coastline. The world-famous Torrey Pines Golf Course is a golfer's paradise. Snorkel at La Jolla Cove, surf at Black's Beach or hike endless coastal trails. Tie in a bit of recreational shopping and saunter down Prospect Street, La Jolla's main drag through the quaint town center, where you will find magnificent retail shops and fine dining. La Jolla is not only known for its fine dining and upscale shopping but also for its luxury homes.

In 2008 and 2009, La Jolla's home prices were the highest in the nation, according to a survey conducted by Coldwell Banker. The survey was based on the average price of a standardized four-bedroom home in La Jolla compared with average prices of similar homes across the nation. The real estate market in Sand Diego County, even La Jolla, has taken a beating since the boom years as they have in many parts of the country. With home prices almost half of what they once were in many areas of the county and with financing rates at truly historical lows, the current market has become extremely attractive to many buyers from all parts of the globe. Together with its mild climate (average daily temperature 70.5 degrees), its beautiful ocean and mountain scenic views, La Jolla and many parts of San Diego County are popular destinations for tourists and home buyers alike. Learn more about La Jolla and other parts of Greater San Diego. And if you are considering buying or selling real estate in San Diego County, call or email me. Today's real estate market in San Diego is a home buyer's paradise. And the uptick in prices for detached single family homes, condos and townhomes is incentive for many homeowners to get those "For Sale" signs up.

In 2014, as in  most of San Diego County, the La Jolla market is rebounding.

If ever in San Diego, make La Jolla one of your key destinations - you won't be disappointed. And be sure to schedule breakfast at Richard Walker's Pancake House, lunch at Georges at the Cove, and dinner at the Crab Catcher, all located right on Prospect Street. Museum visits, some window (or real) shopping to fill in the gaps.

Looking for more info on "The Gem of San Diego"? Feel free to contact me at 858-603-7879 or email me at robert@sandiego-ca-homes.com. www.sandiego-ca-homes.com

The Year You Were Born Predicts When You Will Buy A House

Two new generations are taking over the new home economy for 2015.

Buying their first homes in 2014 and 2015 will be Generation X, born from the early 1960s to 1976 and Generation Y, the first part of the Millennial generation, born from 1977 to 1994.

Like almost every generation, their life spans have included economic slow times, but the good news is consumer confidence today is growing.

While the American economy is slow-poking its way toward full recovery, it is nonetheless growing more and recovering more with each passing year.

 

Generation X and the early Millennials will be seeing friends and former classmates invest in homes this year.  It's important that this new generation prepares itself for home ownership, one of the main avenues for wealth and security.

 

To prepare for home buying, the new generation will have to pay close attention to credit scores, one of the most important factors in buying a home. There is room for optimism there.  Lenders are increasingly loosening standards for credit scores.  In addition, FHA insured loans can give a first-time borrower lower down payments, lower closing costs and easier credit qualifying.

You must have two lines of credit to qualify for an FHA loan.  If you are planning on buying a home soon, make sure you have credit and you pay on time.

 

Credit scores are important. FHA requires a credit score of at least 580 for maximum financing. Lower scores, down to 500, can mean a borrower would have to put 10 percent down on the home.

In fact, plan on a down payment of at least 10 percent.  Some lenders will require more, even up to 20 percent.

 

Lenders will look at total debt, also and that includes student loans.  Many lenders will require that your total debt, including mortgage, be no more than 45 percent (or even 35 percent) of your total pretax income.

 

Some first-time buyers may wonder if it is all worth it.  After all, real estate has had a bad rap since 2008 and many are wary of getting into it. But, home values are rising every year. That means the homes bought now will be worth more next year and beyond.

The payment on a 30-year mortgage will never rise. The same cannot be said for apartment and home rentals, which are predicted to go up by 3 percent each year. And none of that goes back to your net worth as home equity.

To find out about San Diego Homes for Sale or Rentals, feel free to call or email me: 858-603-7879 or robert@sandiego-ca-homes.com  www.sandiego-ca-homes.com

BR/

RM