Dear Sue,
I have a good job with Placer County that pays well.
I have been renting a home for about five years now. My rent is $1,200 per month and I have never been late.
A friend of mine told me that if I could pay $1,200 a month in rent, I should be buying a house.
Sounds good, but I don’t know where to start.
~ Buyer Ben
Dear Ben,
In your position you are very wise to consider becoming a homeowner.
Here are the four things you need to know before starting your home search.
First, interest rates are historically low. You can get a 30-year fully amortized loan with an interest rate of 4.25 percent. The interest rate on a 15-year loan is around 3.75 percent.
These rates may not mean anything to you as a first-time buyer, but when I bought my first home in the early ’80s the interest rate was 13 percent.
Second, home prices are at an all-time low. Five years ago entry-level home prices hovered around $300,000. Today an entry-level home that may need some minor fixing up can be purchased for under $100,000.
Third, get a good lender. A trusted lender is invaluable. He/she will analyze your current financial situation and let you know how much of a loan and what type of loan program meets your needs.
Fourth, you will need to engage the services of a reputable real estate agent who will act as your guide. A referral from a family member or trusted friend is best.
Be sure to choose an agent that listens to you and one that you trust and are comfortable with.
Purchasing a home today can be a matter of good Home $$$s and Sense.
Sue Thompson is owner and sales manager of HomeTown Realtors in Auburn. She can be reached at seesue@seehometown.com, or on the web at homedollarsandsense.com
