Results 1 to 6 of 6

Thread: FHA loan

  1. #1
    AudreyLeigh
    Guest

    Default FHA loan

    Were taking the plunge and buying a new build. Its 335k. Weve been in LOVE withfor a year and they only have 4 left. One available in June, one in August and 2 in September. Our chance of buying our dream home is slowly fading.

    I spoke with the Pulte Manager and he gave us some info.

    1) We would have to put $5000 down as soon as we can to hold the house
    2) Since were first time buyers with a good income we can get an FHA loan
    3) FHA loans are 3% vs. the 10% we were planning
    4) 3% vs 10% down would be a difference of less than $200 a month
    5) This builder is giving $10,000 credit towards closing costs

    So, we have this option. Put 10% down (all our money) OR put the 3% down and have a $25000 cushion if something happens (which is about 6 months of all our bills)

    So, whats better? Im leaning towards the lower down just so were not el broko and stressed if something were to happen...

  2. #2
    God/dess VenusGoddess's Avatar
    Joined
    Oct 2003
    Location
    Home
    Posts
    13,598
    Thanks
    0
    Thanked 28 Times in 23 Posts

    Default Re: FHA loan

    Are you getting pre-construction pricing?

    I would strongly advise going and really looking/inspecting at the other homes they've built. The problem with buying a home from a mass-builder is shoddy workmanship. My in-laws did this and 2 years later, there are still problems.

    The only thing that would make me pause is putting that much money down on a place that you cannot see/inspect.

    If you are absolutely going to do this, I would go with the 3% down and cushioning the rest of the money.

  3. #3
    AudreyLeigh
    Guest

    Default Re: FHA loan

    Yes, pre-construction. Its Pulte and Ive always heard great things about them. The builds that are starting now I would worry more about because from what Ive heard theyre cutting costs but these ones arent as far as I know.

    I dunno. Im seriously debating on this or buying a smaller fixer upper...

  4. #4
    Banned Melonie's Avatar
    Joined
    Jul 2002
    Location
    way south of the border
    Posts
    25,932
    Thanks
    612
    Thanked 10,563 Times in 4,646 Posts
    Blog Entries
    3
    My Mood
    Cynical

    Default Re: FHA loan

    considering that 20 billion has just been approved for a 'subprime' mortgage bailout, it's too bad that you didn't decide to do this a couple of months back. However the bailout package won't give money on FUTURE mortgages written after whatever date was specified in the legislation.

    The bailout package does give a bunch of bailout help to homebuilder corporations too, like Pulte. So you'll be able to get a 'taste' of the bailout money via Pulte defraying closing costs.

    The ultimate question is of course whether or not real estate prices in that particular area have bottomed or not. - as well as whether or not many of the existing mortgage holders in this development will be eligible for bailout money. If they are NOT eligible, odds are that you'll have a chance to pick up a couple of houses in this development at 'distressed' resale prices next year !

  5. #5
    God/dess VenusGoddess's Avatar
    Joined
    Oct 2003
    Location
    Home
    Posts
    13,598
    Thanks
    0
    Thanked 28 Times in 23 Posts

    Default Re: FHA loan

    ^ Agreed. Have you spoken to a realtor in your area to see if the price they are selling at is sustainable by the market?

    Usually pre-construction prices are lower than market trend...however, in the age of the deflating market, make sure you are not going to sign a contract to purchase a place (where you put down non-refundable money) on a home that is not sustainable by the market (meaning a place that you'll lose money on/depreciate the moment you've bought it).

    Do your market research before you buy!!

    As for buying a fixer upper...I would not advise that unless you have at least 3 times that money in the bank. Why? Because not only will you have to pay to have everything fixed/upgraded, but you'll need money to do your regular move-in and make the house yours. Unless you are experienced and can do the work yourself (and are willing to spend the first several months in your new home in a ripped out condition...depending on the condition) you should be having a contractor giving an estimate on how much the repairs will cost based upon the inspection report of what is wrong.

    IME, buying a fixer upper is more aggravation than it's worth and it costs just as much money as buying a non-fixer upper. The only difference is that with the fixer upper, you save money at the sale...but sink that money into the repairing of the house. On a non-fixer upper, you get a home that you don't need to repair, so that money is spent at the closing table.

    6 of one, 1/2 dozen of the other.

    However, finding a foreclosure home and purchasing it...you'll get a $7000 tax credit next year (new legislation). If you look hard, you can find good condition foreclosure (especially in this market).

    Good luck!

  6. #6
    AudreyLeigh
    Guest

    Default Re: FHA loan

    Thanks ladies. I really think I want the new build - Ill have to see what happens in the next couple of weeks...

Similar Threads

  1. Replies: 2
    Last Post: 10-19-2009, 08:45 AM
  2. Buying a House - FHA rates
    By AudreyLeigh in forum Dollar Den
    Replies: 23
    Last Post: 07-08-2009, 08:19 AM
  3. Discrimination and the FHA
    By CherryBomb954 in forum Dollar Den
    Replies: 17
    Last Post: 09-11-2008, 12:19 AM
  4. FHA: Strong SELL
    By person in forum Dollar Den
    Replies: 1
    Last Post: 06-22-2008, 05:03 AM
  5. FHA Mortgage Question
    By Deni in forum Dollar Den
    Replies: 22
    Last Post: 04-14-2006, 12:56 PM

Bookmarks

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •