Dallas TX Real Estate Blog

Feb. 23, 2018

Report: 61% of Buyers Closed on Their First Home in 2017 with only a Down Payment of 6% or Less

Among the first hurdles that home buyers have to to content with is saving for a down payment. 

Traditionally, if you had a 20% down payment, a buyer can secure financing and buy a property.  However, for a lot of folks dreaming about purchasing a home, this can represent a huge upfront investment putting home ownership out of reach.

If your creditworthiness is strong enough, then a 20% down payment may not be required at all to buy a house.  Actually, in some instances you do not even require a 10 percent down payment.  According to the National Association of Realtors: During 2017, a good 61 percent of first-time buyers bought a home with a down payment of 6 percent or less.

FHA loans represent the best low-down-payment mortgage option for many first-time home buyers and is making home ownership a reality for a new generation of homeowners.  The FHA program is great for folks possessing the financial means to responsibly pay their mortgage payments but may not have 20 percent down payment to get into the market.

The Takeaway

Do not let the prospect of a hefty down payment push you away from home ownership since it is in my opinion the most consistent wealth builder right now.  Begin talking to creditors and let's say that you don't have enough cash for a down payment, sometimes these lenders have access to down-payment assistance programs that make the potential for owning a house within your reach.

Feb. 22, 2018

Mortgage Rates Expected To Rise by End of 2018

Buying a home in Dallas TX is about to get more expensive for every home buyer.

Mortgage Rates Rise in 2018According to Freddie Mac's most recent report, mortgage interest rates are widely expected to rise in 2018. The rate for a 30-yr fixed-rate mortgage was 3.9% in Q4 of 2017, and it is expected to jump an entire point to 4.9% by the end of 2018 with many analysts expecting this to happen with a series of 0.25% incremental jumps. Now you maybe asking yourself: Hmm, one percentage point is not much really?

Let's do the math because it makes a huge difference in how much you’ll pay for your home over the length of your mortgage. Let's say you took out a $300,000 30-yr fixed rate mortgage, your monthly payment at 3.9% would be $1,415. At 4.9%, it would be $1,592 – and you’d pay a mind-boggling $63,720 more in interest over the course of the loan. In hindsight, those who paid $5,000 more than asking price to get into a home may have gotten a great deal so if you’re on the fence about buying, now is the time to get off the fence and get into the market.

If you keep pushing off buying a home until the end of the year, you may very possibly face higher mortgage rates and end up paying tens of thousands of dollars more for your home than you need to.