Now may be the best time to buy more than ever. Foreclosures are down 11% from last year. Problematic loans are at its lowest in three years. This means that the housing market is beginning its long haul towards the healthy and stable market that it once was. At the current rate of sales, it may take four years to remove all current foreclosures/ delinquent loans out of the market, but with fewer new loans going bad and fewer new foreclosures, the vast spread of great deals is soon to be snatched up. Here are some factors contributing to curbing delinquent loans…
…More quality loans are being given, making it more realistic for buyers to keep their mortgage commitments. Loan modifications give homeowners more options in keeping their homes and are becoming more frequent. Also, fewer new loans are defaulting than in more recent years. Check out this article from USA Today on this issue.
So, all this being said, there are surely those of you that are thinking about taking your pick while the picking is still good. If so, congratulations, because it has become easier now that ever to get started. Lenders have record low interest rates and there are many public resources available to help homebuyers from down payment assistance to closing cost assistance.
A great place to start may be on the Fannie Mae website, Homepath.com. It is a searchable listing website with many foreclosed properties throughout the country. This website is particularly helpful to buyers who want to learn more about the options for purchasing a home as well as offering special incentives provided specifically through Fannie Mae. The most recent incentive for buyers that was offered was for Fannie Mae to have closing costs covered, up to 3.5% of purchase price, and provided not to just first time homebuyers but to anyone who is making a purchase to occupy. Although this is currently an expired offer there are others. Whether you are buying your first or eighth home, you can make an offer on a Fannie Mae house within its first fifteen days on the market without investor competition. Investor offers will not be considered by Fannie Mae until after this fifteen day First Look incentive. However, for those that are investors, Fannie Mae also offers deals with an unprecedented 10% down payment versus the more common 20% down.
I conducted a quick search for homes in King County, Washington, for 3bd 2ba under $100k and found eight properties, four had the status “under contract” and four with active status. I tried again with the same criteria and area only under $120k and found 14 with six “under contract”. The 8 active listings ranged in price from $118k down to $66k! If you’ve been waiting for a buyer’s paradise, here it is, but for a limited time only.