Editor, Manteca Bulletin,
This letter is in regards to your August 14 article in the Home Scene paper. I don’t know where you get your information. It is not that easy to buy a home in Manteca. Here is what we have learned while trying to buy a home:

1. Banks do not want FHA or USDA offers. They want cash or conventional with 20% down.

2. You always have to offer more than the asking price and will often be asked do you want to offer more.

3. We have to wait weeks to find out if our offer has been refused.

4. FHA loans have a monthly insurance payment.

5. Most houses have converted garages without a permit.

6. We have made over 20 offers in Manteca and Lathrop, always for more than the asking price and have been refused every time.

You need to tell the real story about how hard it is to buy a home in this area. If you are low income and can only afford FHA loans you will end up with a house that needs lots of expensive repairs before you can move in. That is if you are lucky enough to get a bank to except your offer.

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No one said it would be easy. The point is this is a rare opportunity for people who live and work in Manteca to be able to afford to buy a home in Manteca they can call their own.

It is common in the current market for those needing FHA loans to have to make numerous offers before hitting pay dirt.

Yes, cash is king but there are foreclosed homes out there owned by banks that are going to FHA buyers. At the same time there are people out there willing to put 20 percent down who have a conventional loan in line who keep getting aced out by all cash buyers even though they have higher offers. Some banks are motivated to move property as quickly as possible.

Keep in mind every week there are people in your position – as well as conventional buyers – who have gone for months trying to find a home they can buy who ultimately do so. It’s perseverance that counts. More importantly, keep in mind that 10, five, three years or even a year ago there are a ton of people out there who couldn’t even qualify to be in the hunt for a home today who are pounding the pavement trying to secure a home just like you.

It’s a hot market in terms of demand. That means when you’ve got other people making offers you have to often times make a higher offer. There are some banks that deliberately low ball the list price though there are those that don’t. The problem, of course, is FHA will only appraise for what the market value of the homes are in an area which means in multiple offers where they may not be an all cash buyer or a conventional loan buyer with 20 percent down, making a higher offer than what the market value is but it won’t do you any good.

I used a FHA loan to buy 18 months ago. It was at a time everybody thought I was crazy to buy. The market had just started to move and prices where about $80,000 higher than they were today. I had no problem with cash buyers, my full-price offer was accepted in two days, and – yes – I had to spend money to make repairs. I had to replace dry rot, the fence was falling down and the roof probably had two years at most on it — I spent money on those items plus more. I did have the benefit of the bank at the time doing upgrades in the kitchen and bathroom. Banks were still doing that up until perhaps six months ago when prices dropped so low that they decided they wouldn’t be able to retrieve even the value of the upgrades. That is the flip side of this affordable market. Homes are devalued below the cost it would actually cost to replace them which means there needs to be cosmetic work at the very least.

A good number of the homes in the lower end of affordability may indeed have converted garages without a permit. On the flip side, I’ve seen a good number where the garage is still a garage.

All loans unless you have a huge amount down in excess of 20 percent require mortgage insurance. That FHA mortgage insurance is factored into the loan and it is what allows people to get into homes with 3.5 percent down or less.

Again, no one has every claimed it would be easy.

The frustrations and stress you’re going through now, though, will be worth it. The window of opportunity for people to buy in Manteca who live and work here won’t last forever.

I make a fairly decent income but it wasn’t until 20 months ago that prices go down to the point that I could afford to buy in Manteca.

Buying a home even when everything goes your way can drive you crazy and be a big frustration. Keep in mind that this is a move that is a life changer. There are more foreclosures coming which means soon or later the odds are that you can have a home you can call your own.