Feb. 8, 2009 - 1st Time Homebuyer Online Toolkit
Congratulations! You've heard it's a buyer market out there and that there are some great incentives in the real estate market to buy a home now. Now is a perfect time to get educated on the process, things you should know, and incentives that are out there for 1st Time Homebuyers. The information can be overwhelming so make sure you spend your time understanding the market, the options that are available, and most importantly - choose a Realtor with experience that can guide you through the process!!
Here is a list of things I believe all 1st Time Homebuyers need to think through before they purchase their first home.
1. Financial Incentives for 1st Time Homebuyers
7500 1st Time Homebuyer Credit - The housing act is giving a $7500 tax credit to 1st homebuyers (or  someone who has not "written off" mortgage interest in the last 3 years) for homes purchased on or after April 9, 2008 and before July 1, 2009. The credit begins to phase out for taxpayers with adjusted gross income in excess of $75k for individuals & $150k for joint return. The IRS is NOT giving the $7500 credit as cash at closing. The individual must claim the credit on a '08 or '09 tax return. However, a buyer who purchases a principal residence in '09 after filing a 2008 return has the option of filing an amended '08 return to claim the credit.
Special 1st Time Homebuyer Program in North Carolina - The North Carolina Housing Finance Agency (NCHFA) has special programs for 1st Time Homebuyers. There are specific requirements that met including income restrictions, not having  owned a home in the past three years, and the price of the home.
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Rates one-half to one percentage point below market, on 30-year, fixed-rate loans
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100% financing on VA and USDA loans; FHA and conventional loans with 3% down
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Downpayment/closing cost assistance up to $7,000 for buyers with lower incomes
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Job loss protection for eligible borrowers
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Mortgage Credit Certificates (MCCs) that can reduce homeowners' tax liability by as much as $2,000 per year.
Use a Six Month Gift From a Relative to buy a home thanks to the Tax Credit - Jeff Belonger
For individuals or couples purchasing a home in 2009 it's important to note that buyers cannot borrow the 3 ½% down-payment required by FHA and traditional mortgages nor will they allow buyers to borrow any of the closing costs. However, when it comes to FHA loans, buyers can actually get 100% gift monies from a relative. It's called a gift because HUD doesn't want the burden of having the buyers payback a loan after buying a new home.
2. Find a Qualified Buyer's Representative - Experience counts!
3. What to expect with the buying process - Buying your first home can be a scary process. Perhaps your new to the area or have even lived in the area for a long time. Either way the thought of making mortgage payments and owning your own home can be baffling to many.
3. Assess Your Credit and Finances
4. Find the right home - In today's market fist time homebuyers are more savvy than ever. They go online to sites like Realtor.com, Trulia.com, and zillow to see the prices of homes in the area, how the market is performing, and even "shop" for a house online. Many of my first time buyers have homes picked out before I even meet with them. At that point they rely on my local expertise and knowledge of what will sell down the road when they decide to sell their property. The locations of the properties, are they a good value, are they on a steep hill, do they back to a major road? These are things that buyers don't think of when they are making an emotional decision. Read more...
How to find the right home - by About.com
5. Negotiating the contract - Buying a home is an emotional process. Having a skilled negotiator on your side takes the emotion out of the equation and focuses on your bottom line - getting the right home for the right price in today's market.
The Art of Negotiation.....Are you a skilled negotiator? by Peter Vekselman
6. "Buyers Market" Opportunity - The Triangle market has been red hot for so long with a limited supply of housing and prices on the rise. Now, with the increase of new construction and oversupply of housing (an oversupply is defined as more than six months of inventory) there is downward pressure on home prices in our area. Read more...
4 Tips for Buying A Home in a Buyers Market - by Bankrate.com
7. Inspections & Repairs - A home inspection is even more important for home buyers that are new to the buying process. In our area the repair negotiations seems to be the most difficult part of the buying and selling process. The North Carolina Offer to Purchase is changing and more agents are moving towards an "Option Period" and pre-inspections. However, the traditional "Alternative 1" method of entering into inspections can be challenging at times. Read more about the North Carolina process by Carol Fox.
The importance of a home inspection by Up-Country Building Inspectors
Buy A Matthews NC Home: Understanding the Home Inspection Process by Carol Fox
8. Closing with an attorney
In some states across the US Title Companies are used for closing. In North Carolina Attorneys handle the Title search on the property and the closing details.
9. Agency Law in North Carolina
The North Carolina Real Estate Commission requires, by law, that all real estate agents educate their clients on their rights and options as a buyer or seller in the State of North Carolina. This link provides, in detail, agency law in the state of North Carolina.
I hope you enjoy reading through the resources in this Online Toolkit for 1st timehomebuyers. Please contact me directly if you have any additional questions! I'd love to help you find the perfect home.
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