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First-Time Homebuyers: Ready Set Go 
By Yvette C. Page, Contributing Writer
Published August 24, 2016
Yvette C. Page (file photo)

Yvette C. Page (file photo)

Buying a home is a huge responsibility; it is also a huge opportunity. Owning your home means you can paint the walls with your favorite color, plant flowers and vegetables if you choose and plant the seed for an investment in your future.  Most of us were always taught growing up that owning a home http://www.trulia.com/is a financially savvy move and is considered part of the American dream.

According to the National Association of Realtors, research has consistently shown the importance of the housing sector on the economy and the long-term social and financial benefits to individual homeowners.   In addition to tangible financial benefits, homeownership brings substantial social benefits for families, communities, and the country as a whole. Because of these societal benefits, policy makers have promoted homeownership through a number of channels.

Today First-time home buyers are taking advantage and eagerly entering the real estate market to achieve their dream of homeownership.  This urgency is influenced by low interest rates, down payment assistance programs and tax benefits associated with homeownership.

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So who is considered a first-time buyer? According to California Housing Finance Agency (CalHFA) a first-time homebuyer is defined as someone who has not owned and occupied their own home in the last three years. That means if you’ve never owned a home, you’re a first-time homebuyer. It also means that if you owned your home three or more years ago, but sold it, you are right back to being a first-time homebuyer again.

Notably, while interest rates are at an attractive low it is wise to think about buying a home.  Lower interest rates make the cost of borrowing money cheaper.  The cheaper it is to borrower the lower your monthly mortgage payments will be. It is important to understand that interest rates will vary depending on your financial circumstances, lender fees, and other factors.

Further, the money you put “down” or the down payment on your home loan can be one of the largest hurdles for many first-time homebuyers. CalHFA offers several options for down payment and closing cost assistance. This type of assistance is often called a second or subordinate loan. CalHFA’s subordinate loans are “silent seconds”, meaning payments on this loan are deferred so you do not have to make a payment on this assistance until your home is sold, refinanced or paid in full. This helps to keep your monthly mortgage payment affordable. To learn more visit CalHFA at www.calhfa.ca.gov.

Alternatively, local Housing Development Corporations throughout California also provide residents with down payment aid and affordable loans programs.

As a final point, the tax code allows homeowners to deduct the mortgage interest from their tax obligations. For many people this is a huge deduction, since interest payments can be the largest component of your mortgage payment in the early years of owning a home. And real estate property taxes paid on your primary residence are fully deductible for income tax purposes.  It is important that you check with your tax preparer for up to date tax code information or visit www.irs.gov.

In the end, for some homeownership may seem impossible however it is very possible.  Working with an experienced real estate and financial team will bring your dreams to reality.

For more real estate information you may contact Yvette C. Page, President of Callum Page Realty Group directly at (213) 256-6363, ycallumpage@gmail.com or www.callumpage.com.

 

 

Categories: Business | News (Business) | Op-Ed | Opinion | Real Estate
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