It is a great time to buy house after September 11, 2001. Interest rates are the best; you have more buying power and can get more home for the same mortgage payment; sellers are more motivated and more flexible in a slower market; stocks may be down, but in most markets real estate always appreciates; the number of listings on the market tends to rise, and you'll have greater variety and selection right now. Good luck, and don't miss the boat this time!!!

Question: What are the basic steps toward home ownership?
Answer: Talk to your relatives and friends and get ready to buy a home; Talk to a local realtor or real estate company for local real estate information and regulations; Get loan preapproval from a lender; Drive arround and attend open houses; Select a location, school, and home style; Make an offer to the seller through a real estate broker (with deposit); Sign the sales agreement by both parties (with higher deposit); Arrange home inspection with home inspector; Evaluate home value by a real estate appraiser; Apply loan or get personal funding; Select a real estate attorney; Get property or home insurance; Close at the attorney's office; Record at the local registrar's office.

Question: Why interest rates didn't drop while the Fed is droping the interest rate, or why aren't mortgage rates falling faster?
Answer: Fact is, the Fed’s aggressive rate cuts have little to do with home loans, which tend to track trends in the trading of bonds and swaps. The short answer is that the Fed cut its two key short-term rates -- rates that apply to transactions of very short duration and do not influence mortgage rates. On the other hand, mortgage rates are influenced by the yields on long-term bonds, which are securities that won't be redeemed for a number of years. Be alerted: It's in the news everyday lately...interest rates are climbing again. After going down to historic lows, in fact the lowest level seen in 40 years, they are coming back up. While rates are still below the 20 year average, they are not expected to remain at that level much longer. Most experts estimate that within the next 6 months rates will be back to the same levels they were at a year ago. This means that now is the best time to take advantage of current rates before this incredible window of opportunity closes and could be gone forever. Analysts predict that after Christmas and the new year, rates will climb back to old levels quickly!!!! Waiting could cost you thousands.

Question: How to make an offer, offer 15% or 10% or 5% lower than the asking price?
Answer: It depends on how much you like the house, and how much the sellers don't like to keep the house. Usually negotiating1-3% is possible, but it is tough, and sometimes the seller will feel offended if your offer is too low. If the ask price is too high, you may simply wait a price reduction by the seller. However, the odds is the house usually being sold to other buyers before you have any action. Obviously, there is no easy answer or formula for making an offer. Basically, your offer should be reasonable, and must be based on following factors among other things: 1) Is the asking price reasonable? 2) Is it seller's market or buyer's market? 3) Is the seller highly motivated to sell? 4) Are you motivated to buy this house now? Generally speaking, you may start to offer lower than the asking price if the cards are on your hand, vice versa. However, many experienced buyers will tell you when they find some good deals, they are even offering much more than the seller asked. This is why many slow buyers find it is a painful experience to see some good deals passing by. The key is that the real competitors are other buyers. A good advice is, if you like the home, you may consider to make a reasonable offer as soon as possible; if you don't like it, simply wait.

Question: How to get a good deal?
Answer: It depends. Are you buying a home for investment return, or for saving money to beat the rent for an apartment, or just for quiet enjoyment? No matter in which case you will be, a fully informed buyer will have the advantage for a good deal.

Please click on Part II to continue.