Buying — Helpful Hints

GETTING STARTED

• First and foremost, you need to assess and understand the financial ramifications of owning a home. Consider things like ongoing home maintenance, repairs, property taxes, insurance and utility costs. Understanding and preparing for these costs will help you estimate how much home you can comfortably afford.

• Start a savings plan. Most new homebuyers will need to have cash on hand for down payments, closing costs and/or prepaids.

• Get a copy of your credit report to verify that all information is correct and that your credit score is based on accurate information. Your credit score is the key to getting favorable rates from reputable lenders.

• Pay down your credit cards and don’t apply for any additional credit. High credit limits (ability to charge) can negatively affect your credit scores so cancel cards you can do without!

• Select a reputable real estate agent in the area you want to purchase. This person will be able to select the right neighborhood and home to fit your lifestyle and price range. This person will represent you in the selection as well as the negotiation process.

TIPS FOR SELECTING A REAL ESTATE AGENT

Your Real Estate Professional should be:

• Aware of the complicated local and state requirements affecting your transaction.

• Effective in multi-party, face-to-face negotiation.

• Highly-trained, with access to programs for continued learning and additional certifications.

• Knowledgeable in the technology resources that facilitate the transaction.

• Assisted by a marketing professional with available marketing tools

• Supported by a team of trusted professionals available for mortgage origination, Title, home inspection and home repair cost analysis.

• Well-respected in the community with a thorough understanding of the local area, economy and current home values and appreciation rates.

HOW MUCH HOUSE CAN YOU AFFORD?
Any lender will want to make sure you are able to afford the home you buy. Your total monthly payment for housing expenses, which includes interest, taxes and insurance (PITI), should not be more than 30-40% of your total monthly income. As interest rates rise, the price range you can consider will also change as this directly affects your payment level. Keep up to date with the current interest rates by checking our link.

THE OFFER
Once you’re pre-qualified for a mortgage and have worked with your realtor to find the ‘right’ house and situation, you’ll want to make an offer to the seller. The contract will include a sales price, method of payment, date you take possession, fixtures or furnishings that will be included in the sale. Your realtor can provide you with a thorough understanding of all the aspects that would fit the situation you choose. Your realtor should arm you will information so your choice is informed and you have a full understanding of the process, the contract and the negotiation. Your submission of an offer will include a deposit or earnest money. This deposit will be applied to the purchase of the home at the closing.

The Seller will either accept, reject or make a counter offer to your offer. After all the parties have agreed on the points of the contract, you will want to schedule a home inspection to assess the condition of the home. The goal of the home inspection is not to ‘ding’ the seller with minor defects in the home but rather to identify potentially dangerous or expensive conditions so that you the buyer are fully informed. Most purchase and sale agreements are contingent upon an ‘approved’ home inspection.

THE CLOSING
Finally, completing the purchase of your new home. Typically you will meet with an escrow officer to facilitate your closing and settle all paperwork. The escrow officer will review all closing documents for your loan or mortgage. This is an important meeting and you will be signing many different forms. Review all documents! Your realtor may attend the closing or they will review many of the documents in advance and notify you of the costs and fees that you may be required to pay at closing.

Once all items have been signed, moneys collected and final documents recorded you will receive the keys to your new home. Congratulations!

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