Home purchasing is a big project that every one of us has to deal with in our lifetimes. It is better to buy a home if you expect to move within two years; reason is that there are costs associated with selling. Most of the home owners rely on the home appreciation, so that to pay the costs and to provide the down payments and closing costs when they want to buy their next home.
Purchasing a home when you require moving before too long is a risk, particularly in an uncertain market.
Most buyers live in their new home an average of the seven years or more. If that fits you, it almost always makes sense to buy rather than rent in any market. If you are thinking to delay a purchase, because you want to “time the market” to get the best deal, that is almost impossible to do with precision. Even if you are in area with the falling market prices, the expertise cannot reliably anticipate the bottom of a real estate market.
If you are not an owner, but a renter, then you do not get to minimize the income taxes by itemizing the deductions like property taxes and mortgage interest. As a renter, you can make limited changes to your living quarters. But as an owner, you can paint the living room ‘Paris green’ if you want or put in an avocado green carpet. You can also change the light fixtures, garden and landscape.
These days’ interest rates are also very low. If you wait, then the interest rates could be higher. This means your monthly payment could also be higher, too. Home ownership is the easiest way to accumulate the wealth. There is more equity in the home than the assets in stocks, retirement plans, mutual funds and savings.
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Submitted by admin on Fri, 11/30/2007 - 03:44
You want to renew your house, estimated a budget for it, but you don’t have sufficient money, now you want to buy mortgage. The total debt on the house is more than the actual value of the house. If there is time, you can wait so that the value of your home goes up. The problem is solved, but unfortunately, this could take years.
However, this solution does not work for everyone, because many people are bound in a situation where they have to sell their house. There are many other reasons such as relocation, financial hardship, death, divorce, illness, or anything at all. You may have to move, but you cannot sell the house and make enough on the sale to pay the closing costs.
One option is to do nothing and not to make any mortgage payment, but this is a worst-case scenario. ‘Short sale,’ is another option, when you fess up to the lender, you can ask them to accept less money than you owe. The lender does not want to do that, but they also do not want to pay all the costs of foreclosing on a home, repairing any defects, placing it on the market, and getting the best price they can in what may be a market already overstressed with the excess inventory. Lenders do not like to foreclose; they may be willing to consider a short sale.
A short sale involves a lot of paperwork, time and effort and it is best, if you have a real estate agent or anyone knowledgeable to help guide through the process and to give moral support. Contact the ‘loan service department’ of the lender. You will require submitting the financial statement. The real estate agent has to put the home on the market, to find a buyer, and to get an authentic offer.
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Submitted by admin on Fri, 11/30/2007 - 03:42