How much cheaper are foreclosed houses than currently occupied houses on the market?
According to investment services provider Moody's, foreclosed houses sell for nearly 40% less than occupied houses today.
How important are property taxes in deciding to purchase a home?
Property taxes could be a determining factor in choosing one area over another. Check what percentage of a home's sale price will be paid in taxes before you decide to buy a house. A city with very high taxes will charge you a larger percentage of the home's selling price than a more affordable city.
What is a "down payment"?
A down payment is the amount you can comfortably pay in cash to purchase a house. This down payment, plus the mortgage amount, is the price you pay for your house (plus some additional fees and expenses). The larger your down payment, as a percentage of the home price, the less your mortgage amount, and therefore your monthly payment.
How do I know how much to put down on a house?
This is a tough question because it touches on purchaser sentiment. You should already have at least four to six months of living expenses saved in a cash account as an emergency fund, in case something should happen to your employment situation. This money should not be touched, not even to purchase a house. The money you have saved in addition to that—money you may have invested in other ways—should be used for your initial down payment.
What are general guidelines for down payments?
Most lenders would prefer you to put down 10-30% of the house price as a down payment. This may enable you to get better interest rates, pay fewer fees or points, and reduce your monthly payments and interest over the life of the loan. Banks offer many programs, including federal incentives for the purchases of homes, especially for first-time home buyers. Check with your bank or mortgage adviser.