First-time Buyers Choose Your Atlanta, Ga., Home

By: Louise Scoggins

Things could be a lot worse in Atlanta, Georgia, compared to the national realty market this area has been strong, but the pace has slowed. This slower pace of the realty market does mean that prospective buyers can take their time in choosing a home. The cut and thrust of the realty bubble days has well and truly burst, but this can only be good news for the buyer.

The worst hit neighborhoods in Atlanta are the ones that saw the quick escalation of house prices, some of which showed increases as high as 20% in one year, and they are now simply adjusting. Most Atlanta prices have held strong and Atlanta has not seen the dramatic changes in housing prices that has been experienced elsewhere.

However, in one respect Atlanta has suffered the same fate as the rest of the nation and this is in the fact that house sales are slower, therefore homes are accumulating on the market; the inventory is large.

If you are a prospective buyer you now have the maximum choice, the lowest interest rates, and eager sellers which means that you have the right climate in which to bargain over the price or conditions of sale.

Since the government has also ensured that subprime mortgages are off the menu, you should be able to negotiate a fair mortgage, if you have a good credit rating. One way to be sure of keeping your finances at a level that is affordable to you is to sign up for a fixed rate mortgage.

Fixed rate means that the amount of your monthly installments will never fluctuate once they are agreed upon and the payment will only change when the agreed term is up. This is typically five, ten or fifteen years. This period of time must not be confused with the 'amortization period' which is the amount of years it would take you to pay back that loan at that rate.

So if you get a mortgage with an amortization period of 25 or 40 years and a fixed rate of 5% or 6% interest on that loan for a year - that is not what you want. This could mean that after one year you will be facing a change in your monthly payment plan; it could go zipping up and this is what is happening to many distressed home owners right now.

You will require an amortization of 25 or 40 years, that part is okay, and so is the 5% or 6%, but you require it for preferably 10 years while you get on your feet. The mortgage rate is so low many financial experts would tell you to lock this interest rate in for 10, 15 or 30 years.

A broker, the bank or your real estate agent can use a table to work out exactly what your repayments will be for a certain amount of loan. For instance, if you think you want to borrow $100,000 you can be told, in advance, a monthly amount that this will cost you in repayments.

You can also work this out for yourself using some Internet web sites. If this loan is affordable for you to pay back, then make sure the loan 'term' is for several years. It may cost a higher interest rate to 'fix' it for longer, (it nearly always does) but it is a safety measure.

Most first time home buyers work out their affordable loan before they go looking for a home. This way they are only going to look for homes in their affordable price range. Then you must add on the house taxes, water bill, utilities and all your other expenses. The secret is to have your entire expenses amount to a lot less than you earn each month.

Inquiring from a mortgage broker how much you can qualify for and how much the repayments will be and how long the term of the mortgage will be, does not cost you anything and it does not commit you to anything. You do not need to sign anything (except maybe a form that allows your credit rating to be checked).

It is far more prudent to check out your mortgage possibilities before you go searching for a house. This way you will be 'pre-approved' and sellers will take you more seriously. This will give you more bargaining power to lower the price or ask for extras and also the sale will go through more quickly.

If you find a house first, you may be tempted to rush things and accept an unwise financial deal just because you can't risk losing 'the perfect home'.

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