(320)260-3290 steve_baklaich@yahoo.com

FHA from First-time homebuyers to Last

by | May 12, 2021 | Area Information, Buying a Home, First Time Home Buyer, Uncategorized

FHA Financing for your first time home purchase

FHA Financing is not just for first-time homebuyers.  It doesn’t matter if you are moving up, or moving out, or all the way across the country. If the fact that anyone can use FHA, not just first-time homebuyers, is new to you, please read on. Let’s clear up any misconceptions you have, possibly saving you time and money with FHA financing. Far too many people have been given bad information and told only first-time homebuyers can use FHA Financing. 

 

Homebuyers need accurate information

 

Real Estate professionals read a ton of information to keep up with the housing market. A Realtor’s information comes from many different reliable sources. We read what feels like everything, news stories, statistics, market reports, and more. Through experience, market research, and activity in the market, good  Realtors can discern accurate information from click bate.

 

The number of emails per day alone can be staggering. Realtors read emails from homebuyers, and home-sellers, inspectors, Mortgage lenders and other real estate agents. Remember all real estate is local. Plus there are all emails from real estate lead-generating companies, but that’s a story for another day. Then there is all the technical information we need to keep up with to be good at our job. Everything from Home Inspectors reports, to property disclosures, plus all the rule changes from the professional associations, new ordinances from government agencies, etc… The list goes on, but you get my point. Realtors process a lot of information about the real estate market. 

Facts matter for First-time homebuyers 

Multiple industry publications are practically mandatory to stay current with the real estate market.  Plus, we are required to take a minimum of 15 hours of continuing education per year, with regular emphasis on Ethics and Equal Housing Requirements. Many of us take more than what is required. It is important to keep learning new things, as well as reviewing the bedrock principles, in order to stay sharp, effective, and competitive.
For an outsider, such as a reporter, knowing all this information if you are not in it every day can be quite difficult. And mistakes can be easily made, and understandably many are made without any ill intent. Even so, time is money and bad information can cost clients. Sometimes quite dearly.

Don’t let bad information cost you

In the 35+ years, I have been working with home buyers and home Sellers being a reliable source of information has always been an important function. I consider it part of my job to teach and empower them to make good decisions with confidence. Sometimes, however, they may receive contradictory information or misleading information from sources they trust.

FHA not just for First-time Homebuyers

A few years ago I was reading an article in the local newspaper, dealing with the real estate market, and financing programs. The article stated that FHA Financing was a first-time homebuyer program. Even though FHA financing is regularly referenced as First-time homebuyer financing, it is not ONLY first-time homebuyers who can use it. 

I wrote an email to the paper, stating that FHA was not just a first-time homebuyer program. As a commonly trusted news source, they may have caused some harm to non-first-time homebuyers who may have benefited from using FHA financing to buy a home. 

FHA for First-time Homebuyers and beyond

The newspaper contacted me back for clarification.  I explained that even though FHA was a great resource for the homebuyer with a lower down payment capability and with a lower credit score. FHA financing can be used by people who have previously owned a home. Unlike other first-time homebuyers loans which have restrictions, FHA is able to be used by all homebuyers.

The concern is some potential homebuyers may have read the article and assumed they had to wait. They might have thought they needed to wait until they had more money down and more income. Keeping people who want to buy out of the market for a longer time before becoming a homeowner.

Some news articles contain information that is only correct in that area. For instance, if you are in the state or locality where the author lives you might find their story to be applicable to you. But the information may not be correct or accurate if you are buying a home in central Minnesota.

All real estate is local

Most magazine articles and many blog posts are specific to the local market where the author lives and works. As such, a blog written in Boston about real estate market conditions may not apply to real estate market conditions in St. Cloud, Minnesota. Real estate sales in loft condominiums in Chicago may be a great investment with great appreciation in value projected over time, but maybe not so much in that small town in central Minnesota. 

Laws differ, and in some areas traditions differ. In Minnesota, most home sales include a proration of the real estate taxes, and in some areas, the seller may pay the full year’s taxes.

Many cities and states have Truth in Housing regulations. These require code compliance inspections to sell. In states like Minnesota, homebuyers are responsible for inspecting a home and determining the home’s status. 

A few cities in Minnesota have some Truth in Housing regulations, talk to your local Real Estate professional about the area where you are going to buy your next home to see if this affects you.  It is easier to make sound homebuying decisions armed with all the facts for your local market.

Local real estate in central Minnesota

In central Minnesota home sales, the single-family home is king. Preferably with a few acres of land. Loft condominiums less so. A writer from Boston may not know this, but a good local REALTOR will.

In addition, many writers are not in the real estate business. They are general business writers and lack specific real estate experience, unlike industry professionals who live and breathe real estate business full time.

Similarly, a part-time Agent, who may be a friend or relative, may also lack the qualities you require in a Real Estate Professional.

Experience and knowledge are of key importance. To get the best information about real estate where you plan to live, to buy, or sell, you should find a good Real Estate Professional who is also a good teacher. This may or may not be the Agent with the highest number of sales, but rather the Agent who takes the time to educate the Buyer or Seller, to make good decisions based on sound information.

Helpful to First-time homebuyers and beyond 

Even if you are not in the market to buy a home right now you can share this information with a friend who is buying a home. Becoming a homeowner is a wonderful way to begin to establish a solid financial future. It is a fantastic way to establish roots in a community and create stability for you and your loved ones.

The real estate market, rules, and conditions are always changing and you should have a guide to help you through it. The smartest thing to do is find a good REALTOR and start asking questions and gathering knowledge, including getting referral(s) to a good lender(s), who can also be an amazing source of information. 

If you are relocating to central Minnesota check out all the wonderful reasons to love St Cloud. It is a  beautiful area full of things to do and lots of great houses. I would welcome the opportunity to help you find your perfect place here. Browse my website for more information about buying or selling a home, or property in the Central Minnesota real estate market.

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