Buying Your First Home
January 27, 2010
A half century ago, buying a home was a very different process than buying a home in the past ten years. First off, most buyers had to put at least 30% down. FHA and VA programs were the exceptions, but a conventional home buyer needed to have saved enough for that 30% down payment. Admittedly, 30% of a $15,000 purchase price was only $5,000. However, in the late 1950s, school teachers average salaries were in the $3,000 to $4,000 range.
The rules in the real estate market place were in the category of "buyer beware" and there were no disclosures necessarily required of the seller. No final walk-thru or requirements for repairs.
The purchase agreement was probably one 8" x 11" sheet of paper and your loan qualification was primarily based on your W-2; a half-century ago, young home buyers had no IRAs or other stock portfolios. FICO scores had not been invented.
Jumping ahead to today, we see a surge in FHA buyers who need only a 3.5% down payment. We see FICO scores playing a major role in loan qualification. Seller's disclosures can fill almost 20 pages of California Association of Realtor's forms. Buyers request sellers to make repairs and a final walk-thru to be sure work requested has been completed is almost always done. Buying a home can be a tedious process, but "hooray", at last a buyer is now a homeowner!
Being a homeowner can sometimes be a surprise. No parent or landlord to call to fix broken sprinklers. You, the homeowner, are now responsible for the maintenance of your property.
There is a new book published recently by authors Ilona Bray and Alayna Schroeder which is entitle "The Essential Guide for First-Time Homeowners." The authors start with moving in and with how to organize all those papers for your purchase, for your insurance and for your taxes. Since we are in a "green age" they also offer tips on making your new property more environmentally efficient. The authors seem to cover everything from budgets to disaster preparation.
A worthwhile read for both first-time buyers as well as any potential homeowner.
A half century ago, buying a home was a very different process than buying a home in the past ten years. First off, most buyers had to put at least 30% down. FHA and VA programs were the exceptions, but a conventional home buyer needed to have saved enough for that 30% down payment. Admittedly, 30% of a $15,000 purchase price was only $5,000. However, in the late 1950s, school teachers average salaries were in the $3,000 to $4,000 range.
The rules in the real estate market place were in the category of "buyer beware" and there were no disclosures necessarily required of the seller. No final walk-thru or requirements for repairs.
The purchase agreement was probably one 8" x 11" sheet of paper and your loan qualification was primarily based on your W-2; a half-century ago, young home buyers had no IRAs or other stock portfolios. FICO scores had not been invented.
Jumping ahead to today, we see a surge in FHA buyers who need only a 3.5% down payment. We see FICO scores playing a major role in loan qualification. Seller's disclosures can fill almost 20 pages of California Association of Realtor's forms. Buyers request sellers to make repairs and a final walk-thru to be sure work requested has been completed is almost always done. Buying a home can be a tedious process, but "hooray", at last a buyer is now a homeowner!
Being a homeowner can sometimes be a surprise. No parent or landlord to call to fix broken sprinklers. You, the homeowner, are now responsible for the maintenance of your property.
There is a new book published recently by authors Ilona Bray and Alayna Schroeder which is entitle "The Essential Guide for First-Time Homeowners." The authors start with moving in and with how to organize all those papers for your purchase, for your insurance and for your taxes. Since we are in a "green age" they also offer tips on making your new property more environmentally efficient. The authors seem to cover everything from budgets to disaster preparation.
A worthwhile read for both first-time buyers as well as any potential homeowner.
posted by shirley harry at 8:29 AM
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