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THE BASICS OF HOME BUYING

CHOOSE YOUR TEAM

YOUR AGENT

A successful purchase starts with the right representative. In fact, once you’ve selected the best agent to represent you, it is likely that he or she can recommend other professionals to join your team, taking more of the responsibility off of your shoulders.

HOME INSPECTOR

No home inspection is 100% guaranteed, but a few hundred dollars to catch a major problem now is certainly better than many thousands to correct that ‘surprise’ down the road. Ask your agent for a recommendation.

CONTRACTOR

Planning some renovations? You’re not the only one! The home renovation industry is booming, and in some markets, booking a contractor must be done months in advance (that’s a long time to go without a kitchen). Don’t let finding the right contractor slip through the cracks – planning ahead will almost certainly make your renovation smoother, and you contractor will appreciate the advance notice.

LENDER/APPRAISER

A bank is not just a bank. Having the right backer can be extremely important – it is your money we’re talking about after all! Make sure that your lender and financial representative is someone with whom you feel comfortable, and be wary of any lender who promises you more than you think you can reasonably afford. Your lenders may or may not require an independent appraisal, and typically will make arrangements for the appraisal themselves.

LAWYER

Your home purchase is far too important a transaction to skimp on legal representation at the risk of leaving yourself open to costly future issues. Find a lawyer who is willing to take the time to answer your questions and who specializes in real estate law.

YOUR PLAN

FIND THE RIGHT REPRESENTATIVE

Even if you’re not quite ready to buy, your buyer’s agent can be an absolute wealth of information, and can often offer ‘scoops’ on local developments you might not have know about otherwise. Speak to your agent first and he or she can be helping to guide you right from the start.

FIND OUT WHAT YOUR PRICE RANGE IS

Online mortgage calculators are a good place to start, but as you get closer to being ready to buy, there is no substitute for a written mortgage pre-approval. Just speaking to your lender is an extremely worthwhile venture – this is the only way to really get an in-depth picture of your overall financial picture and to discover exactly what you can reasonably afford to spend on a home (and possibly on renovating).

FIND OUT WHAT YOUR LOCAL MARKET LOOKS LIKE

The internet can be incredibly valuable in doing preparatory research. Start with your agent – he or she can direct you to valuable resources and immediately start e-mailing you real estate listings that may interest you (or at least give you a better idea of what your needs and wants are).

FIND OUT WHAT YOUR TRUE NEEDS AND WANTS ARE

Compose a needs/wants list that takes into consideration your local market conditions, your price range, and the advice of your real estate agent.

FIND YOUR DREAM HOME!

Once you’re ready to act, you may be surprised by how quickly you can make a decision. Armed with your pre-approval, a little market knowledge, and your needs/wants list, call your real estate agent, hit the pavement, and when you see ‘the house’, put in an offer.

WITH THE RIGHT TEAM BEHIND YOU

it really can be that EASY!

MORE INFORMATION

Buying a home can be one of the biggest and most important investments you can make. The process of buying the home that you want can be a long and tedious process, taking up most of your time. It’s up to you, as the consumer, to ask any questions, pay attention to details and to learn about the real estate market in the area in which you intend to buy.

Step One

You must know what your wants and needs are before embarking on the long journey of house hunting.

Taking a piece of paper, sit down and write down all the features that are most important to you:

  • Are you looking for a house in a specific city, neighborhood or school district?
  • How many bedrooms and bathrooms do you want or need?
  • Do you want off street parking, or a one or two car garage?
  • If you operate a home based business, are there any restrictions in the area you intend to buy in?
  • Do you want a finished basement or attic space?
  • Do you want a ranch style home or two story house?
  • Do you want a central air unit?
  • Do your want a furnace or a boiler for heat?

Now, on a separate piece of paper, write down all the features that you absolutely do not want in a house:

  • Living in a congested part of town.
  • Living next to an airport, train station or highway.
  • A home that is in great need of repair.
  • A home with too many stairs.

Keep this list in mind as you look at houses. This list may also change from time to time as you look at houses. You may choose to add or remove certain features you do not want or are willing to make compromises on. Don’t be disappointed if you can not find the “perfect” home. Most homes do not come “perfect,” they can only be made that way through time and patience.

Step Two

Before you begin looking at properties, you will need to get your finances in order. This will be a good time to review your credit report and possibly clean it up a bit to improve your credit score. It’s important to check your credit report to make sure there are no discrepancies. Any past due amounts should be paid in full or most companies will be willing to negotiate a settlement price to close the debt.

For example: If you have a past due credit card debt you no longer use and that has been entered into collections at an amount of $900. You may be able to offer the company a settlement of $500 to settle that debt and have the debt stricken from your records. Before paying this settlement, have this agreement in writing. Be sure to keep all of the receipts to the items you settle on your credit report because it may take weeks or even months for the settled debt to be removed from your credit report.

Step Three

Now decide what kind of property you are interested in buying. Are you interested in a HUD, foreclosure, real estate or for sale by owner property? There are many web sites on line where you can find homes by city, state, or price range. On these sites, you can see the picture of the home, many with virtual tours, and review the listing features and details.

Step Four

Now is the time to find a lender and get pre-approved for the loan. This will give you a better understanding of what price range you can look into. Being pre-approved also serves a great advantage for when you find the home that you want, so that you can move ahead and place an offer on the house without having to wait on a pre-approval while someone else steps in and takes the house right from under you.

Lenders may offer special programs on loans, such as the FHA or Ameri-Dream, that can save you extra money in the closing process. Before deciding on a loan, ask the lender about any of these special programs and what would work to your advantage.

Step Five

Most first time home buyers prefer to work closely with a reputable real estate agent, regardless of the type of property you wish to buy. Real estate agents are very knowledgeable and can give you many helpful tips and information that can benefit you. They are also great negotiators and will help explain the complicated paperwork involved when placing an offer on the house or when closing a deal. Be certain that your real estate agent is working for you as the buyer and not for the seller of the house you would like to purchase. This can lead to a conflict of interests and cause many problems.

Choosing a real estate agent to work with should take more than picking a number out of the phone book. Talk to your friends and neighbors and ask them for any recommendations. You should only work with an agent you feel comfortable with.