Agi Anderson

Buy Smart

Homes for sale

Following is a segment from an excellent article by Janet Bodnar, Editor at Kiplinger

Home Buyers in Search of Clarity

The picture should brighten as the “clouds of fiscal uncertainty” begin to part later in 2013.

I’d like to offer my take on how uncertainty could affect a household decision—namely, purchasing a home, whether you’re buying for the first time, moving up or considering a vacation retreat. Aside from analyzing how a house suits your personal circumstances—Is it in a good location? Does it fit my budget?—you also have to factor in larger issues that are beyond your control. You may, for example, wonder whether the housing market has finally hit bottom, and how easy it would be to sell your home if you had to do so unexpectedly (see our outlook on housing). You might worry about tapping your savings for a down payment when you may need the cash later for higher taxes or health care costs.

You could be reluctant to take advantage of rock-bottom interest rates on adjustable-rate mortgages because you have misgivings about the Federal home inspectionReserve Board’s ability to keep rates low indefinitely. And if you are inclined to borrow, you may be put off by a lending process that can take six weeks or more even if your credit score is stellar—and could be derailed if the appraisal doesn’t pass muster or the paperwork is delayed.

“Requests for additional documents can seem ridiculous and endless,” says associate editor Pat Esswein, our housing specialist. One Kiplinger’s reader reports that when he contracted to buy a condo in Florida, the bank “treated my loan application like a robber’s demand note,” despite his credit score of just under 800 and a 30% down payment.