First time home buyers are obviously home buyers. However, first time home buyers also come with some additional needs and challenges. Typically they will have very limited savings to apply towards a down payment or a limited credit history. The mortgages designed to assist first time home buyers are excellent at accommodating these particular challenges. Real estate agents as well need to be accepting and accommodating of the unique needs first time home buyers bring to the table to successfully help their clients locate the right home.

In particular, the current market is a first time home buyers market because of the extension of the $8,500 first time home buyers tax credit until April 2010, a large inventory of resale property available, builder inventories are up and there is a glut of bank owned and foreclosure homes first time home buyers have many homes to choose from. The first time buyer does not have the challenge of selling their current home and therefore can be selective in what they like and do not like in different homes. The current market conditions and the home buyer tax credit extension takes tremendous pressure off first time buyers to make rushed decisions and makes them more desirable then many other segments of the home buying population.

Also, many of the first time home buyer mortgage programs and down payment assistance programs have not been affected by the recent credit and mortgage crisis facing our country. With prices down, inventory up, and mortgage programs still widely available, the current market can be seen as a first time home buyers market as much if not more than a buyer’s market.

The difference between a buyer’s market and a seller’s market is simply who holds the most negotiating strength in a real estate transaction. A good example of a seller’s market was when mortgages were recently flowing quite freely, placing significantly more buyers in the market to purchase a home than were sellers wishing to sell their homes. This trend has shifted 180 degrees in most locations. In a buyer’s market, the buyer holds more negotiating power with plenty more homes to look at and potentially purchase.  The new year should be a happy one for the first time home buyer.

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Extended Tax Credit Means it’s Still a First Time Home Buyers Market

Filing for bankruptcy or home foreclosure need not be an incomprehensible barrier to property ownership. However, it will take a while to re-establish a FICO credit score and save an adequate amount for house deposit. Those who borrow money will also need to accept that they will need to pay an extra amount each month (or higher interest rate) in order to get a bankruptcy home loan due to the greater risk of default posed to the potential lender.

If you are looking to get a mortgage loan after bankruptcy sooner than 2 years from the time of discharge, you will need to have a good payment history since your bankruptcy discharge. Also, you may need to have a down payment. If you have even 3-5% to use as a down payment, that may be enough to help you get approved.

Rebuilding Credit Scores after Bankruptcy: Buying a home is a big investment for anyone from a lender’s point of view. If you want to be trusted with a home loan, then you need to prove to lenders that you are financially stable. So let’s discuss some of the steps you can take to help start upgrading your credit scores as quickly and resourcefully as possible.

* Do not take loan at a high rate of interest as it will create more problems down-the-line.
* Don’t rush into buying a home after bankruptcy.
* Use secured Credit Cards - If you’ve lately come out of bankruptcy you might find it hard to get an unsecured credit card. In a secured credit card the amount in the savings account is used to determine the amount of credit available for a person to use. These are often easier to obtain than a traditional credit card. then they will limit your credit each month to the amount of that deposit.
* Installment Loans - This can include personal loans, student loans and mortgages ect

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Buying a home after bankruptcy or foreclosure

Look for spec homes. These generally are already built, never lived in, and are simply awaiting buyers. Many builders erected them before the economy turned sour with expectations that they would pull in a higher price. Now that price is unrealistic, and builders are negotiating.

Don’t expect that the builder’s financing is the best deal in town. Remember: Over the years you live in your home, you’ll pay more in interest than on principal! Shop around for the best option. If your builder knows you’re being proactive, chances are he’ll give you a better deal. It might come as a lower interest rate, a percentage of the selling price returned to you at closing, shaved points, or some other benefit. He might offer you an in-ground pool if you stay with his financer. But the extra interest could cost you much more than that over the years.

Look for deals even if you are buying in a neighborhood where you wouldn’t normally expect them. When a builder is willing to negotiate, he often does so quietly, so that the people who already bought from him in the area won’t be upset with him.

If you’re looking in a development, choose one that’s close to completion. The last houses to go are generally sold at a lower rate. Don’t feel like you’re getting in on the tail end of a deal if you’re the last to move in. You’ll already know what the neighborhood demographics are. You won’t have questions about whether additional homes are going to block your view.

Another tip for purchasing a home in a development involves walking around and chatting with people who already live there. Ask if the builder lived up to his promises. You will also get a feel for the builder’s reliability and his willingness to negotiate extra features or price cuts.

If the builder offers you an upgrade to compensate for any issue, decline it in lieu of a price cut. An upgrade might place your home’s value beyond the norm in that neighborhood, which hurts you at resale time. Just ask for a price cut.

When you’re looking for your dream home, or even just the land to build it on, hire an exclusive buyer’s agent (EBA). That means your agent works independently of the local brokers. You will still sign a contract with him, but there’s no chance he will also be representing the seller. And specify in your contract, whether you go with a EBA or a local real estate agent, that you want access to all listings, not just one agency’s. You can also retain the right to look on your own.

Check your builder’s reputation with the local homebuilders association or architectural board. Also ask the local Better Business Bureau if the builder has complaints against him. Besides reviewing complaints from other buyers, look for contractors with unpaid bills, which could indicate that your builder is going through a period of instability.

Know what you want in a home ahead of time. Be specific when you sit down with the builder. Vagueness will cost you money later. Don’t let the builder push you into costlier options beyond your budgeted amount — you’ll pay for them in the end. And feel free to carry brochures from other builders with you when you visit each one — the hint of competition lubricates the wheels of deals.

Hold the builder financially accountable. Make sure the builder gets the subcontractors to sign lien waivers. If they don’t, and the builder doesn’t pay them, they can put a lien on your home. Also, make certain he cannot draw progress payments from the bank unless both you and the bank officer have approved them.

For new home communities and developments organized by state visit the home builders page on NewHomeGuide.com/

For your real estate needs in Boulder CO, try Automated Homefinder.

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Top 10 Home Buying Tips for Good Deals on New Construction Homes

A production builder is usually about half the price of a custom builder. This is because they will usually buy several lots of land and build using stock plans which offer some variety of choices and options but not the type of choices that a custom builder will be able to give the home owner. Production builders are builders that usually have large numbers of projects each year. They will build more than 25 projects in a year. These projects, depending on the production builder can be in every price range, from economical entry level homes to luxury builds. They build every type of dwelling from single family homes to condos, rental properties and townhouses or attached dwellings. Most production builders will have a limited list of materials that they use and you are given a few standard choices of what can be used for building materials and fixtures.

Custom builders are different from production builders mainly because the options for home designs are limitless for the most part. They will create the house as a one of a kind project. You can have your own design team to create the plans for the dream home you have always wanted and the custom builder will work with your design team to build to your specifications. Many custom builders do employ designers and offer building plan services to their clients but a home owner is not bound to use only the designers that their custom builder employs.

Another difference between a custom builder and a production builder is that with a custom builder most home owners pick out and buy their own lot to build on. Some custom builders do buy lots of land that you can buy for them to build on but again your choices are greater and you are not required to use just their choices of land. Most of these builders will build less than 25 projects a year because of the extra time, planning and work that goes into building unique homes for each project rather than following standard plans that they use for each project. You have a much greater choice of materials to use as well. The decision making is from your plans, your wishes rather than from their list of materials that they use for every build. The fact that you can use all of the materials that you want, rather than materials that they buy in bulk can mean that the price of your home is much more expensive than if you choose to go with a production home builder. In fact most custom builders prices will be high end homes and the prices can run two to three times the amount you would pay for a home built by a production or tract builder. While it is more expensive to use a custom builder, you do get the home you wanted, the way that you wanted it, where you want.

There are many reputable new home builders that fall in each of these two categories. You need to weigh what is the most important factor in your own set of priorities and constraints when you are choosing your builder. Whether it is freedom of choices or budget, there is a home builder that is right for your needs.

Article presented by Automated Homefinder, Colorado’s Boulder real estate specialists.

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Custom Home Builders or Production Builders? — What’s the Better Choice for Your New Home

Let’s look at items that usually fall to the seller’s responsibility. Excluding his mortgage payoff, which is the seller’s most obvious expense, usually his next largest responsibility is the Realtor’s commission. Traditionally this is six percent of the total sale amount. The seller also pays:

*  Document preparation fee
*  Tax service and set-up fee
*  Settlement or closing fee
*  Title examination fee
*  Title insurance binder
*  Attorney’s fee
*  Title insurance (split with the buyer)
*  Local tax stamp fee
*  Pest inspection

The above items do not amount to very much against the big picture of the sale. That leaves negotiating room to convince the seller to contribute to the buyer’s closing costs.

Why would the seller do that? This usually occurs when housing prices have been driven down, and the seller is motivated to facilitate the sale. It sweetens the deal for a buyer who doesn’t have enough cash for both a down payment and for his closing costs. The way it works is that the buyer’s offer reflects the amount of money that he needs for his closing. To use round numbers, say that John is selling a house for $100,000. Larry is buying it and needs $20,000 down and $2,000 for closing costs but he only has $18,000. Larry then agrees to pay $104,000 and John contributes $4,000 to Larry.

This is perfectly legal, and the only real caveat is that the higher sale price of the home must remain within its appraised value. One other stipulation is that the seller’s contribution cannot be used toward the buyer’s hazard insurance, taxes, or other one-time fees. However, the seller’s contribution often frees up the buyer’s funds so that he has the money to use for those items.

Sometimes the seller agrees to pay points. A “point” equals the cost of one percent of the mortgage. A buyer can pay this amount in order to get a reduction in his mortgage interest rate. But it doesn’t benefit the buyer to pay points if he does not have a down payment of at least twenty percent, because then he has to pay mortgage insurance to the bank. It would make better sense for the buyer to use that money toward the down payment than toward the purchase of points. However, the seller might pay for points — again, to sweeten the pot for the buyer.

There are always alternatives to traditional sales agreements. For example, in FHA home loans, the seller is “allowed” to pay all of the closing costs. The buyer does have to contribute a 3% payment, whether this goes toward closing costs or toward the down payment. Many sellers agree to FHA loans because this is voluntary and they don’t have to pay those costs. However, in VA home loans the seller is “required” to pay the closing costs. Again, this can be negotiated by jacking up the selling price.

Pretty much anything can be negotiated between a buyer and a seller. A seller who has not upgraded aspects of his home might present the buyer with money as an addendum to the sale so that the buyer can arrange the upgrade. Buyers and sellers negotiate every day whether to pay for repairs identified at appraisals, the length of time between closing and possession by the new owner, and many other issues.

During a real estate transaction, the seller has contracted with a Realtor to represent his interests. If he tells the Realtor what he ultimately wants from the sale in terms of dollars, the Realtor can manipulate figures to make it happen. The buyer cannot be advised by the seller’s Realtor. It might behoove the buyer to retain his own Realtor. Each Realtor works for the person who has hired him.
If you have questions about the Boulder real estate market, use AutomatedHomefinder.com, visit NewHomeGuide.com for new homes in most States and Cities.

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