bostonbubble.com Forum Index bostonbubble.com
Boston Bubble - Boston Real Estate Analysis
 
 FAQFAQ   SearchSearch   MemberlistMemberlist   UsergroupsUsergroups   RegisterRegister 
 ProfileProfile   Log in to check your private messagesLog in to check your private messages   Log inLog in 

SPONSORED LINKS

Advertise on Boston Bubble
Buyer brokers and motivated
sellers, reach potential buyers.
www.bostonbubble.com

YOUR AD HERE

 
Go to: Boston real estate bubble fact list with references
More Boston Bubble News...
DISCLAIMER: The information provided on this website and in the associated forums comes with ABSOLUTELY NO WARRANTY, expressed or implied. You assume all risk for your own use of the information provided as the accuracy of the information is in no way guaranteed. As always, cross check information that you would deem useful against multiple, reliable, independent resources. The opinions expressed belong to the individual authors and not necessarily to other parties.

Backed out once again

 
Post new topic   Reply to topic    bostonbubble.com Forum Index -> Greater Boston Real Estate & Beyond
View previous topic :: View next topic  
Author Message
Dorchester grandma
Guest





PostPosted: Sat Jul 28, 2007 5:40 pm GMT    Post subject: Backed out once again Reply with quote

I had made a low ball offer for a condo recently which was accepted. However it would have been a "short sale" which means that it would be a long drawn out process, not short at all. The seller had paid 169. I had offered 155 so her bank loses $14,000

My interest rate of 6.125 would have been locked in for two months. After that I would have to pay an $800 fee to extend the rate should rates go up even higher. The seller is in dire straits, about to foreclose, so would not pay this. Since the place was not exactly what I had wanted (too small) and I see prices dropping daily, I decided that I don't want to wait several months for this deal to go through. Better deals might be coming soon (?)

Interest rates may come back down again and I would be stuck with today's higher interest rate. When you are "locked in" it is for better or for worse. About 2 months ago my rate as a first time homebuyer would have been 5.125. There are too many "ifs" here and certainly if this had been a better fit (a larger place with a porch) it would have been worth waiting for, paying the fee etc.

So here I am again still renting and checking the new MLS listings every day hoping for a miracle to appear EVEN A BANK OWNED SINGLE FAMILY WHICH IS NOT A DILAPIDATED WRECK!
Back to top
admin
Site Admin


Joined: 14 Jul 2005
Posts: 1826
Location: Greater Boston

PostPosted: Sat Jul 28, 2007 7:16 pm GMT    Post subject: Re: Backed out once again Reply with quote

Dorchester grandma wrote:
Interest rates may come back down again and I would be stuck with today's higher interest rate. When you are "locked in" it is for better or for worse.

Are you ruling out refinancing for a particular reason or had you not considered it? Yes, the rate is fixed for the life of the loan, but if rates fall you can get the new rate by taking out a new loan to pay off the original loan in its entirety. Of course, there may be prepayment penalties which you would need to factor in, and maybe it would also be harder to qualify for refinancing in the future if the credit tightening continues or if prices have fallen too far. However, there is at least the possibility that you could take advantage of lower rates in the future even if you bought now. This is one of the reasons that I would prefer to buy when rates are high since that would leave open the possibility of refinancing to a lower rate in the future, whereas buying when rates are low (and they still are) doesn't leave much upside potential.

Your other points seem valid and I think you made a good choice. Best of luck in your continued search.

- admin
Back to top
View user's profile Send private message Send e-mail Visit poster's website
Dorchester grandma
Guest





PostPosted: Sun Jul 29, 2007 12:02 am GMT    Post subject: Why no refinancing? Reply with quote

I did check into refinancing however then I would lose the Soft Second mortgage for first time homebuyers and it would end up costing me more. Refinancing did seem like the obvious choice however it seems that you can't win.
Back to top
john p



Joined: 10 Mar 2006
Posts: 1820

PostPosted: Mon Jul 30, 2007 6:10 pm GMT    Post subject: Reply with quote

I think you made the right move. You learned some important things and the market is trending in the right direction. Best of luck.
Back to top
View user's profile Send private message
Display posts from previous:   
Post new topic   Reply to topic    bostonbubble.com Forum Index -> Greater Boston Real Estate & Beyond All times are GMT
Page 1 of 1

 
Jump to:  
You can post new topics in this forum
You can reply to topics in this forum
You cannot edit your posts in this forum
You cannot delete your posts in this forum
You cannot vote in polls in this forum


Forum posts are owned by the original posters.
Forum boards are Copyright 2005 - present, bostonbubble.com.
Privacy policy in effect.
Powered by phpBB © 2001, 2005 phpBB Group