Q. My income from the federal government is a little over $15,000 per year before taxes. But I'm having trouble getting together enough money for a down payment on a home for my wife, our baby and myself. Lenders I've talked to also tell me I may not quality on a monthly payment basis. Can you give me any help? V.F., D.C.
A. I assume you're not eligible for a Veterans Administration-guaranteed loan. If you are and failed to mention it, you should know that if you'r considered sufficiently "credit-worthy" by a lender in this area, your may be able to purchase a house up to a value of roughly $70,000 with no down payment. You must, however, be able to pay settlement costs.
But other help may be available.
First, the Deparment of Housing and Urban Development has initiated a "graduated payment mortgage" plan (GPM) that allows you to make smaller monthly mortgage payments than the usual "level payment mortgage" plan (LPM) now almost universally in effect.
Here's an example. Let's say your plan loan is $35,000 at 8.5 per cent for 30 years. Your "level payment mortgage" payment (principal and interest, excluding taxes and insurance) would be $269 a month. Under the "graduated payment" plan, it would be $223 a month the first year, $230 a month the second year, $237 a month the third year, and $244 a month the fourth year.
It would increase in increments (reaching $266 monthly the seventh year and $274 a month the eight year) to $300 a month the eleventh year. It would remain at that level through the remainder of the 30-year term.
Now, your down payment problem. The Deparment of Housing and Urban Development is planning to introduce legislation to allow (on FHA-insured mortgages) a 3 per cent down payment on the first $25,000 of "acquisition cost" of a house; and a 5 per cent down payment on the rest of the "acquisition cost," up to a proposed maximum loan of $60,000 (increased from the prsent $45,000 maximum). "Acquisition cost" means appraised value plus settlement costs.
This program can't be initiated administratively. It has to go through the longer legislative process.
In addition to government-insured or guaranteed programs, you may he able to get some down payment help through private mortgage insurance.
@. In April 1975, I purchased a home in the Crofton area for $65,000. It qualified for the $2,000 tax credit. I took the credit on my 1975 return.
I'm in the military and will be ordered to Florida in August, 1977. I will have kid the Crofton house only 23 months rather than the 36 months required to keep the $2,000 tax credit.
Will I have to repay the entire $2,000 tax credit or can any repayment be probated, since I'm in the military? R.J.Q., Maryland.
A. Ordinarily, if you buy a new (never before occupied) home within 18 months (or two years when you have the house built for you) after selling your present home, and if its purchase price is equal to or greater than the adjusted sales price of your present home, there's no repayment of the $2,000 tax credit.
However, since you're in the military, the running of the 18-month or two-year period is suspended during the time you'r on extended active duty. (Extended active duty is defined as a period in excess of 90 days or an indefinte period.) But the total time for replacement of your present home.
If the purchase price of your new home is less than the adjusted sales price of your present home, then you'll have to repay a portion of your $2,000 tax credit based on the adjusted sales price of your present home, minus the the purchase price of your present home.
Q. I'm thinking about buying a home for the first time (I have recently returned from overseas). Since real estate prices have been growing so much faster than salaries in recent years, I am beginning to wonder if real estate growth is likely to diminsh or even stop in the next few years. I would also appreciate it if you could list all the steps a prudent buyer would like to safeguard his investment (professional appraisal, title search, etc.). About how much should one pay for each of these services in the Washington are? Where can I obtain the best services in this area? Is the seller obligated to pay for any of these?
A. There's no reason to believe the upward trend of real estate prices will stop in the next few years, or even seriously diminish short of either a complete (or virtually complete) cessation of inflation or an occurence similar to the Great Depression of the 1930s.
In buying a home, every aspect should be watched carefully. For most of us, after all, a house is our largest, single expenditure of a lifetime. It would be valuable to you to have professional or quasi-professional help at each step, from your beginning seach through transfer of the title. Aspects you particularly want to watch are (1) the location and neighborhood, (2) the condition of the house and its components, (3) condition of the landscaping and site improvements, (4) financing costs, (5) title status, (6) settlement (or, more properly, closing) costs, including amoutn of transfer, recordation, and property taxes.
At a minimum I suggest you retain a home inspection service and an attorney who's experience and knowledgeable in real estate transactions in your area, or a real estate professional who's experienced and knowledgeable in the field of law. Charges for these services vary and are negotiable.
With some obvious exceptions, whether seller or buyer pays charges is, in theory, subject to negotiation. But custom in the county where you buy (which my be presented to you as an almost inflexible rule) will normally determine you pays what.
Earl A. Snyder is a realtor, appraiser and attorney. His address: 14909 Kalmia Dr., Laurel, Md.