Bad Buyer Program
Hear all the reasons why Stacy shouldn't go for a fancy first-time homebuyer plan.
QUESTION: Stacy and her husband are newly married and debt free. They are working toward saving 20% for a house down payment. She works for a real estate company and is being told to take advantage of first-time homebuyer programs with no money down and 100% financing. Are these a good idea? Not even close, says Dave.
ANSWER: I think it’s a bad idea. I grew up in the real estate world, and these people are wrong. You are a young couple, so slow down and do things that are smart for the two of you. Have an emergency fund in place. Then start saving for the down payment. That will make a lot more sense than just rushing it and getting a nothing down deal. That’s what all this financial debacle is about; these subprime, interest-only loans.
Don’t buy a house until you are married for a year, because you want to know how close to your mother-in-law you want to buy. It takes more than a year to pick out what will be your largest asset purchase.