Should you be marketing to first-time home buyers in order to sell your Brooklyn real estate? The 2011 National Association of REALTORS® Profile of Home Buyers and Sellers has a wealth of information on first-time home buyers and will help you figure out if you should market to this large and important group of buyers.

Here are the stats (courtesy of AgBeat.com) you need to know about first-time home buyers before selling your Brooklyn real estate:

• Long-term survey averages show that 4 out of 10 buyers are typically first-time buyers. This segment is critical to a housing recovery because they help existing home owners sell and make a trade.
  • The median age of first-time buyers was 31 and the median income was $62,400, up from $59,900 in the 2010 study.
  • The typical first-time buyer purchased a 1,570 square foot home costing $155,000.
  • First-time buyers who financed their purchase used a variety of resources for the down payment: 79 percent tapped into savings; 26 percent received a gift from a friend or relative, typically from their parents; and 7 percent received a loan from a relative or friend. Nine percent sold stocks or bonds and 8 percent tapped into a 401(k) fund.
  • Ninety-four percent of entry-level buyers chose a fixed-rate mortgage. Fifty-four percent of first-time buyers financed with a low down payment FHA mortgage, and 6 percent used the VA loan program which requires no down payment.

What this Information Means to You

If you’re selling an existing, entry-level home, you’ll most likely be selling to a first-time home buyer with a median age of 31 and a median income of $62,400. First-time home buyers are most likely to get a fixed-rate, FHA mortgage. Gear your marketing toward that buyer to have more success.

If you’re ready to sell your Brooklyn real estate, whether it appeals to first-time buyers or other types of buyers, I’ll market it to get it sold quickly and for as much as possible. Give me a call  Charles D’Alessandro Your Brooklyn real estate agent with Fillmore Real Estate for more information. at 718/253-9600 ext 206 or email me at [email protected]

What Type of Mortgage is Right For You

You’ve been watching the news, reading real estate blogs and you know this is the perfect time for you to buy a piece of Brooklyn real estate.  You want to do all the right things to get the best deal, and you know one of the first steps is to line up your financing.

To help you pick a mortgage that matches your goals and financial situation, here’s an overview of three of the most popular mortgages available today.

Fixed Rate Mortgage

If you plan on keeping your new Brooklyn real estate for more than 10 years and you don’t expect your income to change, this is probably the loan for you.  Although fixed rate loans charge a bit more interest, the rate will never change.  This provides financial stability and the security of knowing what your monthly mortgage payment will be.  By locking in the current low interest rates, you’ll save thousands of dollars over the life of your loan.

ARM (Adjustable Rate Mortgage)

With the ARM loan, the interest rate is usually very low at the beginning but can increase over time.  If you plan on keeping your Brooklyn real estate for only a few years (up to 7) or you expect your income to increase, then this might be a better choice for you. If you expect your income to increase, an ARM loan can allow you to buy a more expensive home now. The drawback to this type of loan is that you do not know what your mortgage payment is going to be in the future; if the interest rate jumps dramatically, then so does your payment.  A particularly popular ARM is the 5/1 ARM.  The interest rate of a 5/1 ARM is fixed for a period of 5 years.  In the 6th year, the loan becomes a typical Adjustable Rate Mortgage.  So if you plan to own your Brooklyn home for less than 5 years, the 5/1 ARM may be your best choice.

FHA Mortgage

If your credit is a bit shaky, an FHA loan may be a good fit for you.  The qualifying criteria for FHA loans are not as strict as for traditional mortgages.  Also, because these loans are guaranteed by the FHA, lenders often allow you to provide a smaller down payment than they would allow for other types of mortgages.  If you’re in a time crunch, an FHA loan may not be right for you; processing times are typically longer than other types of loans because of the government paperwork involved.

If you have any questions about mortgages or need a referral to a lender, Give me a call Charles D’Alessandro Your Brooklyn Realtor® with Fillmore Real Estate at 718/253-9600 ext 206 or email me at [email protected], if you just need help deciding the right timing to sell or buy a Brooklyn home

Some Brooklyn home buyers have an advantage that others don’t in today’s housing market.  They can qualify for an FHA loan.

Federal Housing Administration (FHA) loans help Brooklyn home buyers who would otherwise have trouble being approved for a mortgage.  You can qualify for a loan if you have less than perfect credit.  FHA loans are available even after bankruptcy and foreclosure, if you have maintained good credit for the following two to three years.

What are the requirements for FHA loans?

FHA loans have strict home appraisal guidelines.  The appraisal value helps determine the FHA mortgage limit.  Each state has its own rules regarding maximum loan limits.

What are the advantages to FHA loans?

One advantage of an FHA loan is lower down payment requirements.  You may qualify for a down payment as low as 3.5 percent of the purchase price of the property.  Additionally, most of your closing costs can be included in the loan, so you’ll have less out of pocket expenses.

An FHA loan can also be used to buy a house that needs improvements.  If you need cash to make the repairs, you can apply for a loan to cover the cost of the expected repairs.  The FHA also has energy efficient mortgages which include the costs of energy improvements.

What are the terms of FHA loans?

An FHA loan can take many forms: it may be a fixed-rate loan, an adjustable rate mortgage (ARM) or a reverse mortgage.

• A fixed-rate mortgage has a set interest rate for a set amount of time.  Typically, it will be a 15 or 30-year loan.
• An ARM has a variable interest rate for 15 to 30 years.
• The reverse mortgage pays a set amount of money to the homeowner for the entire time they live in the home.

Whether you’d like to finance a Brooklyn home using an FHA loan or a non-FHA loan, I can help.  Give me a call today Charles D’Alessandro of Fillmore Real Estate at (718) 253-9600 ext 206 or email me at [email protected].