Is it possible to get a home loan after being left in a terrible financial state? A solution to this dilemma could be through the governmental scheme of FHA loans. For families with a terrible credit score a way out could just be a simple …
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My Florida Home Buyer » Mortgage Refinancing Options With A Terrible …
Florida is one of the states most affected by the mortgage crisis. The most accessible loans available in this market are FHA loans. After qualifying for an FHA loan I initially thought the hard part of being a first time home buyer was behind me. But, it would seem that the journey has just begun.
Most communities do not meet the requirements for FHA approval. The most common reason is the high foreclosure rate. The community of interest must also be current on HOA fees, there must be a certain percentage of home owners to investors and other such conditions must be met for an FHA approval. With all these regulations and restrictions associated with an FHA loan it is not hard to imagine that even this type of loan may become obsolete. The dilemma now is not whether you will exceed your budget but whether the available homes within your budget will qualify for the loan type.
With all fairness I am obligated to mention that conventional loans or cash sales do contribute to recent sales. The requirements for a conventional loan in Florida are not realistic. Where some borrowers may be able to contribute 10% down payment the newly required 25% down payment to say the least is a stretch on nearly anyone’s budget not to mention the budget of a typical first time home buyer.
Investor are buying at extremely low prices with cash and conventional loans. FHA loans cannot compete with these investors due to all of the restrictions and rules that they must adhere to. The increasing of number buys by investors in a neighborhood/community further limits opportunities available to FHA first time home buyers. As a result investors and not "home owners" are benefiting from the low market rates.
I have concluded from my observations that the so called homes sales increase doesn’t fully tell the underlying problem. The right rate of available homes and foreclosures properties are not represented in the market. Banks are slowly trickling inventory into the market while the excess or "ghost inventory" remains hidden in their vaults in an effort to manipulate market values.
I have also noticed another disturbing trend. Yes, single family homes, townhouses and condos are at an all time low. But, where FHA approval is not available home prices are much lower than market values. One would initially reckon this is in their best interest but these homes are primarily only available to investors due to requirements and restrictions placed on FHA loans. Where homes are FHA approved this results in homes being listed and maintaining the inflated prices. The limited homes available especially ones built in 2005 and 2006 are in high demand. As a result a new type of bidding war is ensues. Potential home owners of low to moderate income cannot compete with investors of whom recent sales can be attribute to.
I expect home prices will continue to fall. Do you predict a change in the way the real estate market and lenders addresses these new issues and it’s direct connection to lower home prices? Do you reckon the government will relax some of the FHA regulation to combat these issues? (which in itself has pros and cons associated with the outcome for home buyers). Finally do your foresee a new program/stimulus that will help first time home buyers in the near future once this ,000 tax credit expires?
I live in Pompano beach area. I thinking of buying in palm beach county. That market is over saturated with town homes and condos…. Over saturation can be a excellent or terrible thing.
We have found a wonderful home at an awesome price that we can afford, but, the home needs cosmetic repairs where the previous owner left off on renovating both of the bedrooms (No floor covering or doors) and the only bathroom (No doors, floor covering, or tile…but, one working toilet, working sink, and tub).
This home is a small sale and the bank(seller) will NOT pay the repairs or include money in the sale price for the repairs.
The now required 3% down by FHA will take nearly all of our savings. We are trying to find the best option for getting money to end the renovation to make the home at least comfortable in the bedrooms/bathroom area.
If anyone has any thoughts, our ears are so very open because we are signing the offer contract today (The offer has already been worked out between the bank(seller), our mortgage broker(through FHA), and our Realtor and pre-approved so I don't reckon there's any chance of altering it if we want it accepted. The Realtor already proposed that the bank pay some of the repair cost but they won't.)
We're pretty frightened about living in a home (as fantastic as it is) with no flooring or doors and exposed wall board(tile foundation) everywhere in the bathroom.
We are specifically wondering if maybe there is a way to get an advance on, or a loan against the 00 tax credit that we will receive next year at tax time?
We are open to any suggestions that will help us with this dilemma but!
We are even wondering about Federal Grants, but there is so much hype and scamming surrounding them it seems like and we don't know the best way to approach one without getting taken for a ride.
Thanks in advance for your help, any help 
We don't need the 00 before closing, just way before April 2009 which is when we will be due to receive it. (Like within a month after closing)
This house is very much within our price range and one of the lowest in the market for our boy's school district with 2 bedrooms which is the bare minimum we can live in as a family of 4. This home is selling to us about 60% of the appraisal after the repairs are done. We have lived in a tiny 2 bedroom apartment for 4 years saving what we have to place down on the house and the boys are too huge to have any room to study effectively, have friends over, etc. so moving is certainly a must and buying is a much better option than putting this money toward a larger apartment that is going to cost more than this mortgage.
Hope these added details help. Thank you so much for the suggestions so far!!!
Edit "April 2009" in details above = "April 2010"
SRC50,
Thank you so much for your answer to my question is Yahoo Answers regarding the 00 tax credit as follows:
"You cannot get the 00 tax credit in advance. It is payable only AFTER you close on the house.Source(s):http://www.federalhousingtaxcredit.com"
I followed the link and found the following information in the FAQ:
"If I’m qualified for the tax credit and buy a home in 2009, can I apply the tax credit against my 2008 tax return? …Yes…" (followed by more information)
Do you know if this means we can amend our return after settlement and receive the money for the credit at that time???
Sincere Thanks!
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