Ultra-low interest rates mixed with stabilizing home prices continued to push housing affordability in the 3rd quarter near its highest levels in more than 2 decades, according to the latest National Association of Home Builders/Wells Fargo Housing Opportunity Index.  For the 3rd quarter, 72.9% of all homes sold were affordable to families earning the national median income of $64,200.  Prior to the past 11 quarters the Index rarely was above 60%.  With interest rates at historically low levels & markets across the country are now within the reach of more households than it has been for nearly decades,  according to Bob Neilson, chairman of the National Assoc. of Home Builders.

Looking ahead, it will be important to maintain the affordability, access to natural resources & quality of life that have drawn so many homebuyers to Texas, which is a continued focus of the Texas Association of Realtors.  Sales this quarter are comparable to levels in 2002 & 2003, indicating the market is returning to a more normal sales pace, according to Dr. Jim Gaines, an economist with the Real Estate Center at TX A&M University.  Texas has a 7.4 month inventory in the 3rd quarter of 2011, but a higher inventory in our area.  There is still a backlog of foreclosures, but less in TX, but they will cause our inventory to fluctuate in the coming months.  It is better if the inventory is down to 6 or less months for a balanced market.  18% more sales in 3rd quarter 2011, then same period in 2010, partly due the tax credit off.

Texas is one of the states, but must be OWNER OCCUPIED & for full amount of current HUD list price.  The buyer will get an FHA 203k loan & instead of the usual 3-5% down, now $100 down & in some cases help up to 3% in closing costs.  The 203k program allows buyers to finance both the mortgage and additional money for rehabilitation needs with a single government-insured loan.  Necessary to seek out a local lender who can handle this FHA 203k loan.  Some cannot.  These are HUD repossessed homes.  HUD wants homes back in the hands of HOME OWNERS.

Your credit score can predict you behavior in paying your bills, including your house payment.  A person who pays his bills on time tends to that in the near-future.  That is the basis of credit scoring.  To lenders that is your likelihood of making on-time payments in the next 90 days, because after 90 days of nonpayment of your mortgage  you go into default.  Higher credit scores correlate with a lower default rise, which is why you can receive lower mortgage rates.  This applies to all types of loans and lender use the FICO Scoring Model EXCLUSIVELY.  3 main credit bureaus in the U. S.  are Equifax, Experian & TransUnion.  FICO named for Fair Isaac Corporation, invented in the 1950s & is mortgage industry standard for credit ratings.  This is akin to calling all adhesive bandages “Bank-Aids”.  FICO is a trade name & not a product.  With 20% down a FICO score of 740+ and no discount points required.  At 660-679 FICO 2.5 % discount points OR $2,500 per $100,000 borrowed.  This fee can be rolled into your loan.