So said Chicken Little, as he concluded an acorn fell on his head.  He convinced his friends he was right, and the group ran off to tell the king of the impending disaster.  They were tricked by a sly fox who directed them to his den, where he ate them all for lunch.

As the final days of the Home Buyer’s Tax Credit tick away, thousands of potential home owners are letting $6500 or $8000 slip away from them because they fear the sky is falling –or potentially could. Buying a home is a big commitment that requires careful planning, but if you are holding off on homeownership, are your reasons legitimate or are you acting a little like Chicken Little?  Are you so convinced that the worst case scenario will befall you that you are hesitant to make the move to get a house under contract by April 30?  Is something else going on?

How stable is your job? You may have honestly told the lender about your current finances but do you secretly fear a layoff or a change in income?

Do you fear too much debt? If you have been approved for more than you feel comfortable with, there is no requirement that you buy more house than you feel comfortable paying for.

If you are buying a home with a spouse or partner, do you want to be tied into a real estate deal with them? Buying real estate implies a level of commitment you might not want to make.

Are you afraid you will make a bad investment, given the last year or so of falling home prices?

If you take a look at things and determine that you aren’t ready to move, fine – there will still be homes available after April 30.  However, you can take some steps to assure yourself that you are making a good decision to buy:

Consider the whole picture.  Aside from credit, housing prices are low and so are interest rates.

Stay well below what the bank says you can afford.

Put as much down as you can, but not so much that you use all your reserves. Getting an FHA loan rather than a conventional one can help you preserve some cash for an emergency fund.

If you are concerned about your relationship, work with an attorney to set up the deal in a way that will preserve the interests of both of you.

Anticipate an exit strategy if you have to sell.

Chicken Little would have met a different fate had he assessed his circumstances accurately.  No one can predict the future, but you can ensure yours as a happy homeowner if you do.

Express Realty Services specializes in finding affordable homes for residents of DC, eastern Maryland, and northern Virginia.  Act now to take advantage of the Home Buyers Tax credit.  Just call us at 888-306-9450 or visit our website to chat with a representative about how to get started.

When buying a home, you will likely become acquainted with a whole slew of real estate professionals.  From the realtor who helps you select a home to the listing agent who shows you some promising inventory, the experience can be difficult (and extremely frustrating) when any of these pivotal characters fail to meet your expectations.  One of the most controversial areas today is the whole appraisal process.

Help for the Weary

The folks over at Fannie Mae and Freddie Mac are doing their best to ensure that no one plays fast and loose with the appraisal process.  To that end, they’ve created a new code that holds appraisers to a higher standard of quality and professionalism. Sounds great, right? Well, it has already gotten serious backlash from people in the real estate business who believe stricter rules can only hurt an already struggling housing market.

As a result, Fannie and Freddie have tried to clarify what the new code means for homebuyers like you.  One major change outlined in the clarification document is the need for mortgage lenders to accept appraisals only from professionals with experience in the region in question.  Think about it: wouldn’t you want the appraisal coming from someone who knows the area your future home is in?

While communication between and real estate agents is permitted in the process (after all, realtors can be an excellent source of information), they cannot have a hand in selecting the appraiser.  The concern here is that a realtor eager to close a deal will select an appraiser they enjoy a mutually beneficial relationship, one willing to provide the estimate necessary for the transaction to be completed as quickly as possible.  Similar arrangements can often exist between appraisers and lenders, who have been known on occasion to lean on appraisers to overstate property values. While that may help a seller sell his house fast, it certainly won’t help when the buyer faces this dilemma: “I wanted to buy my house fast, but it didn’t meet appraisal. Now what do I do?”

Appraisal Delay or Consumer Protection?  You Decide which is Best.

Basically, Fannie and Freddie’s goal in creating a new code is to protect the homebuyer, and restore purity to the appraisal process.  Whatever delay these new measures may cause will be more than made up for by the increased confidence buyers will have in the accuracy and integrity of the professionals they turn to for an estimate.