Challenges for First-Time Home BuyersAccording to the National Association of Realtors®, first-time home buyers accounted for 39% of home sales occurring in the 12 month period ending June 2012. The increase is up from 37% the preceding year. But will this trend continue? As inventories are shrinking and lending restrictions are expanding, first-time home buyers are facing challenges.
Savvy investors presenting cash offers make it difficult for first-time home buyers to compete with multiple offers. Cash or conventional financing is much more attractive to Sellers, especially if compared to the restrictive FHA loan requirements. In addition, most cash offers will have a shorter escrow time, prompting Sellers to seriously consider the closing date when evaluating the terms of the offer.
If you are a first-time home buyer, it is crucial to be pre-qualified and prepared to move quickly. Contact a Mortgage Broker or Bank and initiate the process. Also, I recommend that you generate a pdf file containing your qualifying documents. The file should include the following documents and updated with revised pay periods and bank statements.
- 1 month current pay stubs
- Two months current bank statements
- Previous two years of W2s