Profile picture for FindMeATownhouse

First Time Home Buyer?

Hello, I am currently in the Riverside area.  The company that I have been "with" for 2 years is looking to open another office in the Los Angeles area sometime this year, and they want me to manage it.  (I say "with" because technically I am a 1099 independent contractor).  My pay has been $45K, but since I will be running the new the office, I will be earning closer to $60K.

I have a great rental history and the thought of home ownership has never seemed realistic, but with this pending move, I'm thinking why not give it a shot?

The past year I have been trying to clean up my credit.  My FICO score is around 647, with 3 open credit cards ($2000 total limit, run them up and pay them off every month), as well as an open car loan ($20K).  Although the only collection/derogatory marks on my credit are from 5-7 years ago, I realize most of my "good" credit is fairly recent.  (1-2 years)

I was wondering if an experienced RE agent can tell me what steps I should take to realistically be considered for a decent loan in the next six months.  I am looking for a 2br/1bath townhouse or condo in the Studio City/Sherman Oaks area.  What sort of a down payment would I need?  A co-signer isn't completely out of the question, but I would like to do this on my own if possible.
  • March 10 2014 - Sherman Oaks
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Answers (7)

Profile picture for UpNest
Couldn't agree more with everyone's recommendations.  I'll pile on with two more things to try. 

1) Try a new house calculator, like this one on bankrate.com --> http://www.bankrate.com/calculators/mortgages/new-house-calculator.aspx.  It'll give you a rough idea of what you could afford.

2) Simply go to your local bank, and ask them for pre-approval.  It doesn't cost anything.  They'll check your financial health & credit score, and tell you how much home you can realistically afford.

For more buyer tips or help on finding an agent, feel free to check out our site.
Hope this helps, and good luck!
  • March 11 2014
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Profile picture for Ryan OKane
Hi there,
Reach out to a local lender that can help you get pre-approved.  Once you have that figure, then you can search for a Realtor to assist in buying a house in that price range. 
Best,
Ryan
  • March 10 2014
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Hi Findmeatownhouse-

The first step to take is to speak with a Mortgage Broker who can help you with qualifying for a mortgage. My mortgage broker also works with a company that helps to clean up your credit as quickly and efficiently as possible. He may advise you to speak with a company that does that if there are items or credit lines that can be improved to help with your credit score. From there, he will help get you pre-approved for a home loan. After that, a Realtor like myself can help show you options for home ownership in Studio City or Sherman Oaks.

Please make sure you work with a Realtor who is working daily in the areas you want to buy in. This is important for many reasons, not the least of which is because a Realtor who works daily in the area you want to buy in has developed relationships with other listing agents in the same areas and will be aware of listings coming on the market and returning to the market. He will have worked with these agents on previous transactions and/or will personally know them as business networking associates. This goes a long way when an offer is submitted for you.

Further, an agent who works daily in the areas you want to buy in will have a good grasp on market values in the neighborhoods you're interested in because he/she will be out caravanning (previewing single family homes/Condos/Townhomes that have just come on the market aka "The Inventory") week in and week out. There are also reasons to work with an established brokerage with a great reputation that can protect your interests, especially when you're a first-time buyer. Buying a home is an extremely complex transaction with many, many, steps that have to be handled correctly throughout the process by an experienced and proficient agent who's with a brokerage that's equally experienced and proficient.
  • March 10 2014
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First off, you should speak with a loan officer as well, especially when it comes to your mortgage needs. When it comes to a down payment, it depends on the type of loan you obtain. Below I have listed current popular mortgages with their required down payments. When it comes to your credit score, it is already high enough for most loan options. Either way, the best thing for you to do is to speak with a knowledgeable lender to see if you can get started on financing a new home. If you need additional assistance, feel free to reach out. Good luck!

FHA: 3.5%
Conventional: 5%-20%
VA: 0% (Must be a veteran)
  • March 10 2014
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Profile picture for Dunes ..
Agree with what I consider the is excellent & honest advice of those who have responded so far...

You need an experienced Mortgage Broker/Lender to tell you what Steps you need to take...period
Fortunately there are some excellent ones who participate here at Zillow so hopefully they will show up here and if not I'd suggest re-asking this question in the Mortgage Category so they'll see it...

Thumbs up for the Agents who imo gave you solid advice..
  • March 10 2014
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I agree that a lender would be able to give you the best answer as to whether or not you are in the best position to buy.  However, from what you have said I believe you could be able to start taking some of the first steps in figuring out what kind of home you want and where this would be located.  And with help from a lender they will keep you in that sweet zone of payment that you desire.  Let me know if you need a realtor in the Riverside area.
  • March 10 2014
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Hello,
From the sounds of it, you need advice from a lender than a real estate agent.  As a lender we can tell you what your credit looks like, what aspects need improvement, and how much loan you qualify for (also how much you would need to put down, which changes if you have a non-occupying co-borrower).

Realtors will want you to have a  pre-qualification letter from a lender before they take you to look at houses too!

Click on  my profile and feel free to call me if you'd like more info!
  • March 10 2014
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