Houston TX
1st Time Home Buyer

Q: Do states offer help to home buyers?

A: Most states have a housing finance agency, usually located in the state capital, which offers help for first-time home buyers.

Q: When is the best time to refinance?

A: The traditional answer to that question is when interest rates fall 2 percent below your current mortgage interest rate. However, in recent years some experts have argued that refinancing may be appropriate with a smaller point spread. Some weight is often given to the length of time the owner anticipates holding on to the property. If the owner expects to keep the property for at least three or four years, then refinancing may be worthwhile. While refinancing can involve upfront costs, in many cases it is possible to roll the costs of the refinancing into the new note and still reduce the amount of the monthly payment.

Q: Where do I get information on refinancing?

A: For information on refinancing, the following booklet may be helpful: * "A Consumer's Guide to Mortgage Refinancings;" Federal Reserve Bank of San Francisco, Public Information Department, P.O. Box 7702, San Francisco, CA 94120; call (415) 974-2163 to order.

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Q: Can I refinance after bankruptcy?

A: Refinancing may be prudent but could be difficult after a bankruptcy. If you're considering bankruptcy, you may want to go to your current lender first and explain the situation. If you have been current on your payments, the lender may be accommodating and refinance your loan, easing your financial situation

. Q: What are no-doc loans?

A: "No-doc" loans are mortgages for which lenders require very little loan documentation as long as the borrower puts down a sizable down payment, generally 25 percent or more. These mortgages are common among self-employed people who say they earn a certain amount of money but whose tax returns show that their earnings are much lower. Resources: * "How to Shop for a Mortgage," Mortgage Bankers Association of America, 1125 15th St., N.W., Washington, DC 20005; call (202) 861-6500.

Q: Can someone who is unemployed get a loan?

A: Generally, lenders will not make loans to unemployed persons because someone without an income would seemingly have no way of making monthly mortgage payments. However, there are home loans for which lenders require very little loan documentation as long as the borrower puts down a sizable down payment, generally 25 percent or more. These "no-doc" loans are common among self-employed people who say they earn a certain amount of money but whose income tax returns show that their earnings are much lower. Borrowers should check directly with lenders when seeking a no-doc loan. If specific lenders do not offer them, ask for a referral.

Q: Do we dig deep and buy a dream home or settle for a starter home?

A: Choosing between a smaller house in an affluent neighborhood, an older, bigger house in a more working-class community or a brand-new home is not easy. If you're in this situation, start by examining your priorities and asking the following questions: * Is the surrounding neighborhood or the home itself the most important consideration? * Is each of the neighborhoods safe? * Is quality of the schools an issue? * Do any of the areas seem to attract more families with children or adult residents? And where do you fit in? As for the return on your investment, home-price appreciation is hard to predict. In the late 1980s, the more expensive move-up housing appreciated wildly. But during the recession that followed, smaller homes tended to hold their value better than more expensive ones.

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