Cash The Checks

Today I made an official offer on my first home. The asking price is $875,000. The offer was $820,000. If they’re eager sellers they may just bite and take the offer. I thought the offer was just going to be a quick 1 page letter, but in reality it’s about a 20 page contract with all this legal mumbo jumbo.

I’m going to wait a bit to lock in my rate, because September 18th the rate may go down by 0.25%. I’m getting a 30 year fixed rate jumbo loan, so interest rates are hovering around 7.0% right now. A rate drop next week will bring that number down to something more manageable.

If the offer is accepted, that’s when the ball starts rolling, inspections are done, loan is obtained, closing costs are paid, and the moving in begins. How exciting! (not being sarcastic).

Purchasing a home is a major decision, and it can seem impossible if you have bad credit. Do you need help with IRS back taxes. You can also get information on debt management if you’re in serious need of debt consolidation services.

0.50%

Today the fed cut rates as expected, but it was 0.50% not 0.25%. It was predicted rates would be cut a quarter point in September, another quarter point in October. The base rates went down from 5.25% to 4.75%.

I’m in the process of buying my first home (Re: Making an Offer) so this news is great, it means I can lock in my rate right now. I’m getting a 30 year fixed rate jumbo mortgage loan, so the rates I was looking at before were hovering around 7.00%. Now it looks like I’m getting a 6.50% or perhaps even better.

The interest rates are down, but the national debt keeps rising. If you need help with debt consolidation or you have increasing tax debt, there are solutions.

A new job report came out recently: The number of Americans with jobs has dropped for the first time in 4 years. Then we’re also seeing the stock market decreasing and becoming more volatile lately. Let’s not forget that there are record number of foreclosures and homes are sitting with “For Sale” signs much longer now.

All this could be enough for the feds to lower their interest rates when they meet September 18th. Experts are predicting a 0.25% cut to a 0.50% cut. I found this link that lists the history of the rate cuts, and it’s interesting to note that there hasn’t been a change since June 2006. It’s hard to believe that according to that chart, the rate was as low as 1.00% about 3 years ago. I wish I would have bought a house then.

So if you’re on the verge of buying a home, it’s best to wait just a little bit longer, and see if you can get a better deal in two weeks.

If you’ve been looking to buy a home but are wary about interest rates, perhaps you should look into the cost of a modular home. Look online to find modular homes on sale, or better yet, start construction on a new home. You could save money and time by looking into modular homes!

The real estate market boom that we’ve been experiencing up until about a year ago was due in part to ARM loans. ARM laons are Adjustable-Rate-Mortgage loans. This means that your introductory interest rate starts off very low, and then in 3 or 5 years, it will adjust to a much higher rate. Sounds dangerous doesn’t it? It can either adjust down or up, but most likely it will go up and your payments might double. So you’ll be forced to sell your house, if you can’t sell it or afford another house, you’re screwed, time for a foreclosure!

So who is to blame for people entering into these silly loans? The lenders or the home owners? The answer is a little of both, but mostly the home owners. Credit card companies also offer introductory APR’s of 0% that go up to 20% later, but that’s not their fault, if you’re dumb enough to fall for it, knowing what the terms are, then it’s your fault and nobody should help you.

I heard on the news today that some politicians may entertain the idea of raising taxes to bail out these people who find themselves in these tough predicaments. It sounds completely unfair that if you work hard, do everything right, save your money for a down payment & get a fixed rate loan, that you have to pay for the mistakes of others. I don’t like this “we’re all in this together” attitude. If that’s the case, there’s little motivation to succeed, because you’re always going to have the government helping you out regardless of what mistakes you make.