Great Food, Enlightening Conversation
I just came back from dinner at a local bistro where in very close quarters you can't help but hear the next table's conversation. There were two couples, young professionals (late 20's) having a drink while waiting for dinner. My antennas went up when one young man said to the other couple, "I was called today by my lender to alert us as to the possibility of refinancing our mortgage at 4.75%. Since we have a 30 year fixed rate at 6.5%, I told him that we would surely be interested." He went on to say "he told us that we would have to come up with $25,000 in order to meet the appraisal requirements. I said that wasn't possible. Who has that much cash these days?"
The young woman across the table interrupted him and said in an astonished tone, "you can't refinance your mortgage even though you are making your payments? I am glad we didn't buy a home when you did."
He responded by saying "I hope you are thinking of buying a home now. You can buy the same home we did for $50,000 less and get a 4.75% mortgage. My lender also told me about an FHA program that requires a 3.5% down payment and you get a $7500 tax credit. I wish we had the same opportunity that you do now. It makes no sense for you to continue renting and throwing your money away."
I couldn't have said it better. Unfortunately, there are a substantial number of potential first home buyers that are unaware of their options. Who is going to alert them?
If every Realtor in the country, was successful in educating one buyer that then bought a home in the next two months, then the press might put their antenna's up. Let's do our part to stimulate the economy.