http://leahcoss.ca

Many people get very hung up on retaining or using their first time home buyer status. When I ask them why, they are often unsure of what the savings exactly are and if they even qualify based on the home they are buying.

Really, when it comes down to it, there are just 2 main benefits to being a first time home buyer and it really depends on you and where you are buying to see if this will effect you at all.

1. As a First time Home Buyer you are allowed to pull out up to $25,000 of RRSPs Tax Free. If you pull out any more than $25,000 then you will be taxed on that money but for the most part $25,000 will be a big help.

Now, if you do not have any RRSPs then obviously this is not much of a benefit for you. If you plan to save up RRSPs in the future but will be buying a house in the meantime then unfortunately you will not be able to take advantage of this benefit. Once you buy a home that you are on title to you lose your first time home buyer status.

2. You are able to save on your property transfer tax when you buy your first home up to a purchase price of $425,000. (with a sliding scale up to $450,000 but that is a long complicated story). So what does this mean?

Well, if you buy a home for $400,000 you will save the $6,000 property transfer tax. If, however, you live in an expensive area like Vancouver and are looking to buy a 2 bedroom condo or any kind of a detached home then chances are you can’t find ANYTHING for under $425,000 and this benefit does not help you.

If you buy a place for $480,000 you save NOTHING. Not even a percentage that factors in the $425,000 to save you even a little.

So how is this amount calculated? You are charged 1% on the first $200,000 of the purchase price and 2% on the remaining balance. So for a home that is $500,000 you will have to pay $8,000 and whether you are a first time home buyer or not you will have to pay this whole amount.

So there you have it. The benefits of being a first time home buyer. These really are great benefits but only if you have a use for them.

If you have any questions about this then please leave comments below or contact me at Coss.L@mortgagecentre.com.

Thanks so much and I hope to talk with you soon

http://mortgagesInVancouver.com

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http://www.ezchfaloans.com, 0 Down CHFA Mortgages for First time Home Buyers in Denver, Centennial, Aurora, Littleton, Lakewood, Highlands Ranch, Arvada, Westminster, Thornton, Boulder, Brighton, Parker, Colorado. If you are looking for 0 Down CHFA mortgages for First time Home Buyers in Denver, Centennial, Aurora, Littleton, Lakewood, Highlands Ranch, Arvada, Westminster, Thornton, Boulder, Brighton, Parker, Colorado. See this site.

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http://realestatemarketingthisweek.com/first-time-home-buyer/the-median-income-first-time-home-buyer-can-afford-twice-the-median-priced-home/ – The median income family can afford twice the median priced home –

Part 2 – And now I mentioned Dan Havey is back in the studio with us, Dan has done a lot of great things in the mortgage industry. He left us about a year and a half ago, is that right Dan?

Yes, I left the mortgage industry in October of 2007. Tell us a little bit more about yourself.

As you know I came originally from Wisconsin, where I got a degree in Business Finance and I came out here in 1989 and started working with my brother selling real estate owned-REO, bank owned properties for Fannie Mae, Countrywide, and the Resolution Trust Corporation-RTC which was the government entity that was put in charge of disposing of all the real estate owned by the 1800 S&Ls that had failed. I did that until about 1995 when I moved into the mortgage industry and there for 12 years I worked predominately with bankruptcy attorneys helping their clients get out of bankruptcy and foreclosure. I left the mortgage industry in October of 2007. Now I am working predominately in the arena of marketing for real estate and mortgage companies, helping out companies, just like Im here helping out Michael today, to get people to realize that right now actually is a really good time to buy.

There are a couple of points I want to make and it was something that Michael had said earlier. The first one was that 4% interest rate. Originally Obama said a couple of weeks ago, when he rolled out the mortgage plan, that they were going to take the $200 billion and use it to buy mortgage backed securities, well the article I was reading today said it appears that plan may have changed. Instead of buying the mortgage backs they were actually buying the stock of Fannie and Freddie to help support the company and keep these companies going under. I dont quite understand why being how they own them now.

Well youve got to hand it to the government they have really done a heck of a job helping Fannie Mae out, for instance today the stock is up to $0.41. Wow, doing so well, I remember when it was $150 or so, where it was at the top of the market.

Today, right now is definitely the best time even if rates dont get down to the 4% point. The beauty of it and were going to talk more about this in a later segment, is that we have seen a 51% decline in home values from the peak of the market. So you dont have to have the absolute greatest interest rate in order to be able to buy a house today. The median home price right now is $130,000 in Maricopa County, it was $264,000 just two years ago.

So the median home price is $130,000? We are going to talk a little bit about what a person has to make to actually qualify for that. Well it is definitely well within the means of a median income family. Right now a median income family makes about $64,000 in the state of Arizona according to the US Census Bureau and HUD. I ran some numbers today, I think at 6% interest and at that rate they can buy a $280,000 house. So you can buy twice the median home price if you are making just what the median income family would be in the state of Arizona. So the median household income buys double the median priced house in Maricopa County. That is correct, at 6% interest.

And the reality of it is interest rates are not even that high right now. So for people to be waiting for that perfect interest rate of 4% it doesnt really matter if it gets here or not because right now is such an incredibly fabulous time to be buying a house. There are so many foreclosures out there on the market right now, there are so many short sales out there on the market right now, and the point you made earlier is very important, that people have to get in and get prequalified, know exactly what they can buy. Now in many cases you are going to need a down payment, so get with your mortgage broker, get with Velocity Financial and start working on that program of getting those funds together for the down payment as well.

Dan Havey we talked in the past about whats available for financing these days, interesting to give little pat on the back for Velocity Financial is one of less than 15% of all of the lenders in the state of Arizona that are qualified to do FHA financed homes. Now FHA financing, people used to think it was only for first time home buyers, thats no longer the case. The FHA loan which only requires 3.5% down payment it doesnt matter if you have owned a home before and in many cases you can own another home now so long as your new purchase is going to be your primary residence you can utilize FHA financing and put only 3.5% down… http://realestatemarketingthisweek.com

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First Time Home Buyer Seminar with Kenn Renner – 08

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Hear what first time home buyers need to know about Hawaii mortgages. Marvin Galicha http://EasyMortgageHawaii.com 808-927-2935. Pitfalls: Low Credit Ratings, Junk Fees, quick approvals, Pre pay penalties. Don’t miss out on the house of your dreams.

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http://Creditchoices.co.uk give their top tips for first time buyers on mortgages.

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There has been no secret made of the fact that UK house prices have risen over recent years, and many home owners have benefited significantly from this. The rise in home values has meant many people have been able to free up cash tied up in their properties whilst sill owning a significant amount of equity to make them comfortable with this. Combined with the relatively low interest rates this has been a dream come true for home owners. The boom has even meant record numbers of people borrowing against their homes to lay down deposits against holiday homes or buy-to-let properties, gaining doubly from the rising market, and having the effect of further fuelling price increases.

Although industry experts don’t seem to be able to decide whether the boom is over or not, and the case can be argued differently depending upon different geographical areas. It would certainly appear that over the last 12 months or so, the growth has in general slowed.

Whilst the boom may have been the best thing that has ever happened financially for existing homeowners and those lucky enough to have bought first and second homes at the right times, it is not so good news for first time buyers. The overall increase in prices has not only increased the average house price in the UK significantly, but it has dragged the bottom end of the market in particular to new heights making that first step on to the property ladder as difficult as ever for first time buyers. The burden is especially difficult for University Graduates who not only face the likelihood of having to move towards the cities to find the right sort of employment, meaning that in many cases they can’t even seek the solstice of a family home for a while whilst they find their feet, they are carrying the millstone of student debt around their necks whilst they do so.

The above statements, I believe are a fair summary of the state of the UK housing market and the problems faced particularly with first time buyers today, but let’s now analyse the facts to see where people really stand in 2007.

Year Average Salary Average Salary

(Population) (22-29)

1997 £16,250.00 £14,336.40

1998 £16,842.80 £16,286.40

1999 £17,503.20 £17,071.60

2000 £18,189.60 £17,799.60

2001 £19,182.80 £19,026.80

2002 £20,004.40 £19,827.60

2003 £20,467.20 £20,098.00

2004 £21,507.20 £18,652.40

2005 £21,985.60 £18,834.40

2006 £22,926.80 £19,224.40

Year Average House Multiple Multiple

Price (Population) (22-29)

1997 £78,199.00 4.81 5.45

1998 £84,396.25 5.01 5.18

1999 £93,609.00 5.35 5.48

2000 £106,960.00 5.88 6.01

2001 £118,604.50 6.18 6.23

2002 £136,635.25 6.83 6.89

2003 £155,226.25 7.58 7.72

2004 £178,136.25 8.28 9.55

2005 £188,565.75 8.58 10.01

2006 £192,831.33 8.41 10.03

Source:

Average salary figures taken from www.statistics.gov.uk

Average house price figures 1997-2005 taken from www.proviser.com and 2006 figures from www.communities.gov.uk (figures are averages of all completed sales during the stated time period).

In 1997 the average house price in the UK was just over £78,000 with an average salary of £16,250 for the general population, and £14,336 for 22-29 year olds – typical first time buyers. The average house price in 1997 was therefore 4.81 times the national average salary and 5.45 times the average salary of a 22-29 year old. A 10% deposit for a 22-29 year old on the average salary buying an average house in the UK would have represented 54.5% of a year’s gross pay. Although clearly a struggle, the prospects of couples in particular finding their way onto the housing market was good.

Looking at the same comparison for 2006, the average UK house prices was just under £193,000 – an increase in 10 years of 147%. The average salary for the UK population had also increase to just under £23,000, and increase of 41% and to just over £19,000 for our 22-29 year old demographic – an increase of 34%. Incredibly, the average house price in 2006 was 8.41 times the average salary of the UK population, and over 10 times the average salary for our 22-29 year olds. A 10% deposit now represents almost exactly one whole year’s salary on average.

These figures clearly demonstrate that the lifestyle and expectations of the UK population has had change forced upon it. Being able to afford a house on a graduate salary straight out of University is a pipedream only possible for the very luck few.

Where does this lead everybody else?

One of the catalysts behind the increase in prices in the housing market as previously mentioned is the increasing number of ‘buy-to-let’ properties purchased by those lucky enough to see the values of their own properties increase. It would seem logical that the rental demand for these properties has also increased as the would be first time buyers can now in general only afford to rent and often to seek out suitable housemates to share their rented house or flat with.

A good source of housemates can be found at sites such as www.abodewithme.com which has grown as an aide to home seekers who in today’s economy simply cannot afford the luxury of their own place.

Another option for would be ‘first time buyers’ is to get on the property ladder by purchasing part of a property. At least in paying a mortgage instead of rent, even though a property is not entirely in an individuals name, will at least allow them to benefit from any further rises in the property market, leaving them lagging further behind in their rental properties.

There are several ways of purchasing part of a property and renting the other part with an option to buy in the future, although these such arrangements often mean paying a mortgage and rent, which will cost nearly as much as a mortgage to cover the full value of the property.

I read recently of a leading high street bank offering joint tenancy mortgages for up to four applicants. This means it is possible to buy a property with three others all contributing their earnings towards the total borrowing, and each taking an agreed share of the value – and the increase in value of the property. This seems incredible, given that most of us find it hard enough finding one person that we are happy to make the commitment of marriage to, and as they say, marriages are easier to get out of than mortgages.

Again, it raises the question as to how to find suitable candidates that you would be willing to take the plunge of buying a property with. Some people will be lucky enough to have long standing friendships, or perhaps relatives, brothers, sisters, etc., who are also looking to get onto the property ladder but cannot afford to do so alone. Short of this, highly recommended would be a website such as who has profiles of all sorts of people with varying budgets, all over the UK, and equally as importantly wanting to enter into the same type of partnerships.

Regardless of the route that individuals choose to take, whether to rent or buy, the state of the property market compared to average salaries as we have seen means more and more people will be living in house shares for many, many years.

If you would like to find out more about candidates looking for house or flat share companions, please visit .

Lee Unsworth
http://www.articlesbase.com/relationships-articles/what-is-the-impact-in-the-rise-in-the-housing-market-on-first-time-buyers-98841.html

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http://realestatemarketingthisweek.com/real-estate/the-old-rules-of-real-estate-financing-no-longer-apply-and-suze-ormond-should-know-that/ – The old rules no longer apply and Suze Ormond should know that. –

Part 7 – We have Dan Havey the author of Real Estates Future in the studio today.

Michael, I was just curious, back when I got into the industry many, many years ago there used to be a rule of thumb that if you were going to refinance you had to lower your interest rate by at least two percent and I know as time went along and products changed that really became unnecessary, but I am just curious in todays mortgage market its a lot different than we were dealing with even two years ago. Is that still true that there is a 2% rule? Whats going on now?

I happened to catch Suze Orman on television and she was talking about mortgages, the caller who called in to the program, the question became I believe similar to what Dan just asked, her comment was that basically if you’re in 6% interest rate or above now is the time to re-fi. That is what she said, a blanket recommendation. I know a lot of people put a lot of credence into what she says, maybe you could speak to that, the lowest interest rates you’ve seen in your career, you have been doing this for a while.

I have, and they are. You know there was a lot of speak the last couple weeks about the Fed, the Fed funds rate by the way is the lowest it’s ever been in history. As of this week the discount rate is to the point that banks are lending money to each other at nothing, the Fed funds rate for intrabank lending is at zero, the problem is the banks don’t have any money.

To be serious about the refinancing, because its a serious topic, I think people are starting to see their mail boxes filled with lots of advertising crap about refinance. I believe that doing the refinance is no different from doing a loan modification or buying a house, you need to sit down with the human being that’s local, that you can know is a legitimate source. You’re going to give all this personal information about you, your family, your kids, your Social Security number, you want to make sure you have somebody there that you know whos legit.

In regard to the old rule of thumb 2%, nothing could be further from the truth, and I will expand, but to the point of Ms Ormond that if youre at 6% or higher, that is a blanket statement and blanket statements never work. We just did a refinance for a guy who was at 5 1/2%, and it makes sense. Every situation is different, as far as how much do I have to lower my interest rate to make it work? It depends on the type of mortgage that you get.

The only type of loan to get today in December of 2008 is a 30 year fixed. I know that one of the things that was really interesting to me, and that you and I have referred clients to one another for several years, so we share a number of clients, were familiar with those families and those households, and this is Wednesday, on Monday and Tuesday of this week I’ve had seven phone calls from clients who you’ve already done loans for, refinances for, asking if this is the time to refinance a loan that is only a couple years old.

And I know in several of those cases the answer is yes you’re actually helping families right now with that process. I am and we do. To answer the question, you need to determine what the payback term is, in other words when your refinance is done it’s a new loan, there’s the title insurance, appraisals, lots of different things may need to be done, not in every case, but in most cases there are costs associated with that. The cost has to be offset by the amount of savings. Its a breakeven analysis

Absolutely it is, the shorter the breakeven the better the loan. I am working on a case right now which is going to be done in the next couple of days where the guy lowered his interest rate by an1/8 of a percent and it made sense for him. It’s not for everybody, 2 percent or lower, 2% is significant, now you’re talking about really significant savings in terms of cash flow… http://realestatemarketingthisweek.com

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Click here for Part 2: http://www.youtube.com/watch?v=jTXPzr_2BxQ

As the founder of Bello Mortgage, let my 11 years of experience and hundreds of resources find the best mortgage for you.

The Canadian First Time Home Buyer video gives new home buyers the basics on what they should be expecting when they look to buy and finance their new home.

This 2 part video looks at:

-Application Process
-Difference between Pre-approval and Approval
-Different types of mortgages
-Downpayment
-Financing availability
-Closing costs

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For more information or to receive our Free Newsletters, visit:

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or call:

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http://realestatemarketingthisweek.com/first-time-home-buyer/fha-guidelines-regarding-foreclosures-and-first-time-home-buyers/ – FHA Guidelines regarding foreclosures and first time home buyers –

Part 7 – Ok I was just checking because I thought this was a story about all the mortgage backed securities that were going under. It started at the top and it worked its way down. The reality of it is that people were buying homes, not reading what they were signing, not understanding how it worked and shame on the people who were putting it in front of them, knowing that they didnt know and we all need to take a little responsibility here for this past crisis. It is not just the Wall Street firms; its not just the mortgage companies and banks, the brokers have little in fact to do with it, we didnt create the loan products that people were buying, we were merely disseminating it to the public. I am glad to say I was not a part of any of that. I was able to stay away and do traditional, conventional type financing for people. So luckily I didnt have a lot of clients who got stuck into that nightmare.

Speaking of that nightmare, Dan when we talk about the people who have had foreclosures, their lives have been turned around, turned over and they think that there is no where for them to go. One of the nice things about the Federal Housing Administration loan, the FHA loan, thats the first time home buyer type loan, the minimum down payment loan, its only 3 years after you have had a foreclosure that you can qualify to purchase a home again. So it is important if you have had a foreclosure, you need to point your future away from the flame, you need to save your money, do your best, work as tightly as you can on a budget and look forward to that time when you can go back out and buy a home again.

Property values are going to be up from where they are today, but there is still going to be plenty of great value out there and there are not going to be loan products that are going to get you in trouble again. They wont exist. What really caused the great inflation in home values starting in about 2002 was the financing was just getting crazy. I wont get into a whole lot of technical stuff about mortgage backed securities and all that, but the lenders were creating products, selling them off their books, thinking that they would never have to worry about them again. They sold trillions of dollars worth of these loans and those are the ones that are going bad.

Ones that were toxic in the first place: the stated incomes, the option ARMs, all those loans are all gone now. I was saying earlier today that we are back to where we were in financing in 1992-1993, back when the median home price was $75,000. Now I dont think we are going to go anywhere near that again, I think at $130,000 we are getting real close to the bottom of the market and what I was thinking was when I got into the business in 1995 and you were in at about the same time I was, and I remember talking to a guy who comes into our office to sell us loan programs, now this is the very beginning of the really crazy stuff, and he was saying we can do 70% no doc loans.

We go, what do you mean? If somebody puts down 30% they dont have to verify anything, they dont have to verify their employment; they dont have to verify taxes, anything. We were absolutely floored, but by the peak of the market we were doing 100% no doc loans. If you were breathing they gave you a loan and the credit scores didnt have to be that high, I think I saw them as low as 600… http://realestatemarketingthisweek.com

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