Its almost time for me to take the home purchase plunge. Any advice for a newby please?

Question

Its almost time for me to take the plunge. Any advice for a newby please?

Couple questions… ok more than a couple.

Stats

-1st time home buyer

-Phenominal Credit

-70K down payment ready

-Stable good income job with very little debt

-How much home I can appx afford: $375K

I’ve been doing my research over the past year and its coming down to the wire pretty quickly. My lease is up in December of this year and I think its time for me to buy. I can stay month to month renting for a bit more $$ than I’m paying now if I haven’t found a home that jumps out at me, so I don’t really have a “set-in stone” deadline. I’m in the Southern California area and know exactly the area I want to live (Fullerton).

Question 1: Home prices around the area have dropped and are still dropping dramatically. Do you think Dec 08 /Jan09 will be a good time to pull the trigger, or should I continue to wait it out?

Question 2: When? ……….. When should I get a pre-approval? I read that the pre-approval lasts 60-days if you lock in the rate, so if I decide Jan is my month to buy, then mid November I should start getting quotes? When should I get the actual loan?

Question 3: Should I get a Real Estate agent now? Not only to browse homes, but for lendor recommendations and possibly foreclosure advice/showings?

I know it’s a handful, but any advice is greatly appreciated as I’m a bit nervous and confused after reading post after post in this forum.

Thanks

Chris

Answer 1

You are definitely ready to buy.  Don't worry about the realty agents.  You can start now or wait.  There are many agents.  You may want to try out 5 of them to see how smart they are.

Home prices may drop a lot more.  Will you feel silly if you buy in December and they drop $50,000 in February?  We are all gamblers when we start house hunting.

You can get a home loan in 7 days from the best lenders.  Not a "preapproval" in 7days.  I'm talking about the real thing.   You need to find an excellent lender and that is tougher than you'd think.  You need to talk to people who recently bought or refinanced.  Not someone who takes realty agents out for free lunches every week. /

Answer 2

I would say wait another 6 months  from now  since prices are still dropping in your area.  Also I would keep an eye on the interest rate.  i would  apply for  pre-approval in like 4 months from now maybe like around Jan 09, You only want to check you credit score no more than once or twice since over checking can bring your credit score down.  Its also not a bad idea to contact a Realtor in a couple of months from now you never know what deal you might run into.  The main thing is to get pre approved.  Try not to time the market, as long as you are financially ready go for it.  Just keep about 3 months worth of living expenses for a rainy day.  good luck    

Answer 3

I live in Southern CA, too.  I'd wait a few years longer.  I'm not going to buy until we see two quarters of growth in the market.

Also, according to Yahoo.com Real Estate, there are 725 foreclosures in Fullerton alone.

Check out this site:

bubbletracking.blogspot.com/

It's written by a former OC homeowner.

Remember, buying high is a sure way to lose your downpayment...

You've waited this long.  What's a few more years?

Answer 4

It is best to get pre approved now. You should use an agent if you have no familiarity in the housing market.

When making an offer on a house lowball the offer most people trying to sell their house right now either have to get out of it right away or they are being forced to do to financial difficulties.

Remember someone elses problems can be a huge advantage to you. Dont worry about how they are feeling just make an offer 20-25% below asking and take it from there. Try not to make offers on houses that you agency lists they will and have been known to tell buyers before they even take the offer to the table that the buyer wont accept the offer. This is illegal , and you are in the drivers seat on any offer you put on the table.

If you want a bargain then short sale houses are plentiful ATM people really want out and are currently in the forclosure process.

You can preview houses on realtor.com you will spend many hours on that site if you are really looking to buy.

Good luck to you , and remember do your research get a reputable inspector that will get into the areas of the house to find hidden problems. Pillar to Post is a good company with good ratings.