If you are thinking about buying a home, here are a few things you should NOT do.

1.  Don’t make any major purchase that would create debt.  This includes furniture, automobiles, appliances, etc.  An increase in debt may make your debt-to-income ratio too high and jeaopardize  your ability to get a mortgage loan.

2.  Don’t move money around.  This includes checking and savings accounts, certificates of deposit, etc.  Your lender will be reviewing your accounts as a source for your down payment and closing costs, and any large deposits or withdrawals may draw scrutiny.  You might be required to produce a paper trail for these items which could get tedious and frustrating.

3.  Don’t change banks.  You want your banking history to be stable, just like your job history, which leads to number 4…

4.  Don’t change jobs.  A good, stable job history will lead lenders to believe you’re not likely to default on a loan.

   5.  Don’t be late on your credit card payments or charge too much.  This could not only negatively affect your credit score, but charging excessively could indicate a problem with money management.

Jana Nelson from Paradise Real Estate in South Lake Tahoe talks about the differences between buying a bank owned property and buying a privatley listed property. Jana has been in the Real Estate industry for 15 years.

If you are looking for a bank owned property in the South Lake Tahoe Area, CA or NV, contact Jana Nelson at 1-800-996-2001.

The latest results from Freddie Mac’s Primary Mortgage Market Survey showed 30-year fixed-rate mortgages averaged 6.11 percent with an average .5 point for the week ending December 13, 2007. This reversed an eight-week trend where the rates held steady or declined. Last week, the average 30-year fixed rate mortgage averaged 5.96 percent, a new low for 2007. The highest average for 2007 was 6.73 percent on July 19. Last year at this time, the 30-year fixed-rate mortgage was nearly identical with a 6.12 percent average.

“November’s employment report showed stronger job growth, no change in the unemployment rate and a jump in wages, suggesting to some market participants that the probability of an upcoming recession might be lower than originally thought,” said Frank Nothaft, Freddie Mac vice president and chief economist. “This led to a rise in interest rates for U.S. Treasury securities this week and mortgage rates followed.” Nothaft believes that the recent quarter-point rate cut by the Fed will likely diminish upward pressure on mortgage rates over the next few months.

“Mortgages are still available despite news to the contrary,” said Dan Spano, President of Paradise Real Estate in South Lake Tahoe. “The rates are very attractive and this is an excellent occasion to invest in Lake Tahoe real estate. Home prices have declined and there are some outstanding buys available from motivated sellers. Now is the time to purchase your dream home at Lake Tahoe at the same price or even less than several years ago!”

The recent fallout in the subprime mortgage market has permanently changed the landscape for homebuyers. New Century, a subprime lender that was once the second largest in the industry, filed for bankruptcy in April. The company joined dozens of other subprime lenders to crash and burn in the housing market downturn. They were all victims of rapidly rising default rates.

So what does all this mean for the homebuyer? Basically it means it is quite a bit more difficult to get a mortgage loan now than the past few years. Popular forms of 100 percent financing have just about disappeared completely. Companies that were previously anxious to lend money are now very cautious. “First-time homebuyers will be affected because now they need to come up with a down payment,” said Dan Spano, President of Paradise Real Estate in Lake Tahoe. “This will prevent many first-timers from purchasing a home. Higher risk borrowers with low credit scores will also get squeezed out. The impact has truly been felt from Wall Street to your street.”

“However, if you are looking to purchase a home, do not despair,” Dan continued. “Mortgage rates are still historically very low and it is truly a buyers market. There is creative financing available, you just have to do some more shopping. Please call me direct at 530-318-1945 and I help you purchase the Lake Tahoe home of your dreams. I will be happy to share all of my great connections in the mortgage business. Together, we can get it done!”