Considering your first home?  The process can seem overwhelming. Your first buy in several years?  You'll wonder what happened.  The process is more complex than ever before.  But, the buying a home experience really is simple.

Most folks begin by cruising the Internet; looking for homes you might like.  You check areas of your goal community that appeal to you.  What about schools?  What is the crime rate?  What does the area look like?  It is all available on line.  With Google Maps, you can roam interesting areas in street view without using a gallon of gasoline!

You begin making some decisions.  How big a payment can you handle?  What do you think that will let you afford for your new home?  Check Bankrate.com for calculators or download an app for your Android or Iphone. Recommendation: Estimate a bit lower than you think you can afford each month. 

Why aim for a lower payment?

When you rent a place and have a repair issue, the landlord takes care of most of these.  In a condominium, the association handles things outside your unit in exchange for the monthly association fee.  With a home, it is all yours.  Recommendation: Condo or detached home, consider adding a home warranty plan to help if major systems or appliances fail.

You determine locations and features important to you.  A logical step is to meet with a qualified lender to get your loan pre-approved.  This is important.  You would not go shopping for clothes, food, or any other item and leave your money at home.  Failing to get advance loan approval is just like leaving your wallet on the dresser.  Recommendation: Compare service and reputation among a few lenders before you decide.

Next Post will include some handy checklists to help you along

Here to Help, not to Hound!
Bruce Forge
The Forge Team

Lots of reports out there? Seems confusing to many buyers and sellers.

• One source says we've reached the bottom and prices are going up.
• Another says we are still sinking on home values, but sales are up.
• Yet another says the inventory of properties is dropping, but so are prices.

How can we or anyone decide on a best course of action?
Prices will always change, up and down.  Sellers can set the asking price.    But, a seller has one home to sell.  A buyer can choose from all available homes in a price range.  Buyers choose the purchase price. 

The "market" collects results.  We review these collected results, compare what we see with past examples, then guess what it means.

Always remember that ALL CRYSTAL BALLS have a blind spot to the future.

We, as individuals, do what seems to us to be the right thing.  Buying a home, any home, is a decision based on emotion.  Then we float the emotion on a bed of "logic".  It is a home, not a house.  And not an ATM machine.  Never was.  Even though millions used it that way.

What do you think?

Here to Help, not to Hound!
Bruce Forge
The Forge Team

Hey Tustin, this Southern California Edison offer is from 2011, but it is still active.  If you'd like to save money and update your old appliances to energy efficient ones.  If you qualify on the income limits, all the benefits are free to you.

Check it out right now on the official SCE YouTube site.

There are many similar programs across the nation.  Check with your local utility providers to see what may apply in your area.  Some are income dependent.  Some are more generally applicable.

Every dollar saved has value.  Remember, "Money can't buy happiness, but it sure makes misery easier to live with."

Questions and comments are welcome.  Use the Add comment option just below.

Here to Help, not to Hound!
Bruce Forge
The Forge Team

Mr. Buffet is among the most successful investors in the world.  The "Oracle of Omaha" has grown his Berkshire Hathaway Corporation from tiny to billions of increased net worth and income.  Primarily he uses a value approach.  Generally this means buying when prices are low and holding the assets while prices and income both increase.  All with strong management taking care of the asset, which in his case, are typically businesses.

So what does this have to do with buying houses?  Well, he didn't actually say Buy a Tustin Home.  But, as of March 2012, home prices in Orange County are as low as we have seen in many years.  Not just in absolute price.  But more dramatically, in price to income. 

And interest rates are low as we've seen in over 50 years.  One can obtain 30 year fixed rate financing between 3.5% and 4%!  Low rates make for low payments.  Low prices make for low payments.  And at the same time, rental rates are increasing. This is a great situation to buy and hold property. 

For the first time in many years, it is possible to find positive cash flow investment homes in Orange County with moderate loan amounts.  If you can buy for cash, you will see returns from 5% to 10% cash on cash.  If you finance, the rate of return will rise, but so does the risk as the mortgage payments continue whether your tenant pays the rent or not.

If you wish to consider a middle ground, there are opportunities to get returns from 5% to 8% or so, paid as interest on your funds used to finance the property PLUS you get an equity kicker (25% to as much as 50%) of the value increase over the next ten years.  Stable income.  Bonus on liquidation.  Check with your tax adviser or consider using your self directed IRA or 401K plan to eliminate or delay possible taxation on these investments.

Questions and comments are welcome.  Use the Add comment option just below.

Here to Help, not to Hound!
Bruce Forge
The Forge Team

We all know that bad things happen to good people.  Often such things go past our ability to control the events - at least for a time.  Job loss.  Serious illness.  Major injury.  Divorce.  Death in the family.  These are things that can shatter the best laid plans.

Credit takes a big hit.  Bills unpaid.  Home mortgage default.  Maybe even a foreclosure or short sale.  Bankruptcy is more than a threat.  In fact it is often a relief.  No more creditor phone calls.  No more excuses.  You can clear your head and rebuild your life.

So, where do you live when your world turns over?  Many families are flowing back together, sharing the largest home.  By combining income and sharing assets, they get by.  And inter-generational families offer grandparents wonderful connection with grandchildren often not otherwise available.

Another option for many Tustin families is our Rent to Own program.  Here you offer to purchase a property, but get to move in now, before it closes.  You will rent the home for the time it takes to get your financing in place.  While not really a do it yourself project, experienced professionals make this a viable program in cities all across America.

Get more information on the Rent to Own program here.

Questions and comments are welcome.  Use the Add comment option just below.

Here to Help, not to Hound!
Bruce Forge
The Forge Team

You have to have heard the news.  49 of the 50 state attorney's general have given the big 5 banks a no jail time required pass in exchange for some smoke and mirrors and a tiny bit of money.  Most of which will NOT get to the people who were injured.

Another example of government help.  If you ever want to really understand the results of government help, ask any Native American for there real life experience with this entity.

But, just in case you still believe in childhood myths, here is a link to the new government web site to share the news (such as it is) with you and your friends.

http://www.nationalmortgagesettlement.com/

Questions and comments are welcome.  Use the Add comment option just below.

Here to Help, not to Hound!
Bruce Forge
The Forge Team

It is that time of year again.  Red Roses by the many millions.  And tons of chocolate

Back to normal this week.  And this is the second week of February already.  Just celebrated a 43rd wedding anniversary with my lady.  Went to dinner at the same place  where I asked her to share my life.

Still great prime ribs of beef at the Five Crowns in Corona del Mar.  It is one of the few places left in business from just our short history.  Thinking about such changes can be a slippery slope.  All the companies and businesses that used to be, but are no more.  Most of them were good businesses; some even top contenders in their activity.  Some personally owned.  Some corporate owned.

What do you remember from your past?  Especially if what you remember still exists as it was then.

Questions and comments are welcome.  Use the Add comment option just below.

Here to Help, not to Hound!
Bruce Forge
The Forge Team

As if we don't have incredible gadgets already, enjoy this look at the future through the eyes and minds at Corning Glass.

Notice the intelligence in the system.  The convenience and efficiency.  The traffic management ability.  Aren't you glad you live in these exciting times?

Questions and comments are welcome.  Use the Add comment option just below.

Here to Help, not to Hound!
Bruce Forge
The Forge Team