Baton Rouge Realtor Homes

Hello to all the potential home buyers out there.  I know there’s so much going on in the news right now, it’s hard to know what to believe.  So let’s hope this blog post can clear up some of the confusion.

First, let’s talk about interest rates. Yep, you’ve seen it.  Someone, somewhere has advertised a rate of 4.6%, 4.8%, 4.4%, etc.  How do you know what your rate will be?  Well, unless you talk with a lender, you won’t know.  First of all, the rate that is typically advertised is the best possible rate.  It would typically apply to someone with 800 credit scores, putting at least 20% down for a conventional loan on a primary residence.  You see there are a lot of factors that go into determining your rate.  So, if your credit scores are in the 675 range, your rate will be higher.  Some banks are even charging hits to the rate for people with scores of 700-719.  Part of this is the lending industry correcting for past mistakes.  So, be prepared if your rate is higher than the rate that plastered all over billboards all over town.  And remember, if rates weren’t so low to start with, then with the added hits, your rate could be even higher – so you’re still getting the deal of a lifetime with respect to interest rates.  Rates remain at the lowest levels that they’ve been at in 30 years!

The tax credit – $8,000 - up for grabs.  Ok, so first, this applies to a first time home buyer which is someone who hasn’t owned a principal residence in the past three years.  How cool is that?  So if you did own a home, five years ago but haven’t since then then, presto bingo, you’re a first time home buyer again!

Second, there are income limits so you may or may not qualify for the entire $8,000.

Thirdly, you may have heard a lot of noise about FHA saying that you’ll be able to use the tax credit in advance of receipt of the money.  Well, they put the cart before the horse on this one.  While they may still figure out a way to make it work there isn’t anything that I’m aware of YET to make this a reality.  So, for now, you need 3.5% for a downpayment and you may file for the tax credit when you file your tax returns next year.  That’s still pretty good… getting $8k back from Uncle Sam!

P.S. I did hear a rumor that Louisiana was working on a putting a mechanism in place for you to get use of that tax credit up front as your downpayment. But at this point, I have to question if the beauracracy can get something in place before the 12/1/09 deadline expires.  My suggestion is – DON’T WAIT – MOVE NOW.  Go ahead and make that move now. Take advantage of this phenomenal buying opportunity, Now!

If you want more information about the tax credit, I suggest that you talk to your CPA and take a look at the website.

That’s all for now.  I’m sure things will keep changing daily so keep looking out for new information as it hits the streets!