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WHAT YOU NEED TO KNOW BEFORE YOU BUY A HOME

Get Pre-approved! Unless you are paying cash you need to get approved for a mortgage before you start looking at homes. You will know exactly how much you can afford so you can look in the correct price range and you will need to submit a pre-approval with any offer. If you find the perfect home and you donít have a pre-approval letter you risk losing it. Get pre-approved first and when you want to make an offer you will be ready. Once you have been pre-approved do not make any significant changes in your credit or employment. Do not change jobs or do anything to increase your debt load. That new car will have to wait until after you close on your home. Even a minor increase in your debt load may prevent you from qualifying for a mortgage. When you are ready to make an offer on a home you will need to put down earnest money. You will need to put down a minimum of $1000 on most purchase offers and some sellers require a cashiers check. Be ready to provide this when you sit down to write an offer. Let your Realtor help you decide what to offer by showing comparable sales data for the home you are interested in buying. By being informed on what similar properties are selling for you can make a good decision on how much to offer to get the best price without risking offending the seller. You want to open negotiations, not close the door on them. If you are making an offer contingent on selling your current home,...

TIPS FOR THE HOMEBUYER

You should look at several homes before choosing one so you have a basis for comparison. Don’t be turned off by paint colors- itís an easy & cheap fix. Don’t forget to check the basement- check the age of the furnace and water heater, look for evidence of water damage or mold along the walls. Don’t shy away from homes that are not in move in condition, if a little work will increase the value, it may be worth the effort. Don’t place all damages on the same level, worn carpet is far less serious than a leaking roof. When looking at empty homes, try to visualize the rooms with your furniture to make sure you will have enough space. Take measurements if you need to. Short sales generally take much longer to close than standard sales. Drive by the neighborhood at different times during the day to understand the area. Donít be afraid to talk to the neighbors to get information about what itís like to live there. Remember, bad neighbors and run down houses in close proximity can have an impact on the value of a property. GET PRE-APPROVED FIRST. Unless you are buying with cash this needs to be your first step. Be flexible about your wants. One house will seldom fit all your wants so be ready to compromise. Check the driveway and sidewalks for cracks. Re-placing concrete can be expensive. Donít be blinded by nice dÈcor. The owner will be taking that with him. Remember you are buying the empty house, not the owners high end furnishings. If you plan on re-selling in 5...

10 STEPS TO PREPARE FOR HOME OWNERSHIP

Get Pre-Approved for a mortgage. Do this before you start looking for a home so you know what price range you can afford. When you are ready to make an offer, you will need a written pre approval. Once you have your letter you will be ready to make an offer when you find a house. Develop your home wish list. Prioritize the features and be willing to compromise. Decide where you would like to live. Take into account school district, work commute and any other things that will affect the location of your home. Start Saving. Depending on the type of mortgage you are getting you will need enough money for your down payment and closing costs. You may also want money to pay for inspections, attorney fees etc which are not figured in to basic closing costs. Donít forget moving expenses, utility deposits and insurance. Make sure you have enough cash available to cover these costs plus a little extra cushion for emergencies. Get your credit in order. Obtain a copy of your credit report and make sure it is accurate. Most mortgages now require a minimum credit score of 640 to qualify. If yours is less than that you may want to get some credit counseling to raise your score high enough to qualify. Explore your mortgage options. Talk with your lender about the different types of loans you may qualify for and what the requirements will be so you can make an educated decision. Organize your documentation. In order to get approved for a mortgage your lender will require W2 forms, recent pay stubs, tax returns,...

What to Expect at a Real Estate Closing

The final step in a real estate transaction is called the closing. When you are buying a house, this is when all the papers are signed and the ownership transfers into your name. If all goes well, you walk out with the keys to your new home! If you have never purchased property before, the closing process can seem a little intimidating. If it has been awhile since you bought property, a lot has changed. After all the contingencies have been met ( all inspections completed satisfactorily, the appraisal completed and your financing has been approved) you are ready to schedule your closing. Your closing will be scheduled on or before the closing date you agreed to in your contract. Until that time, the seller still owns and will probably retain possession of the property. Keep in mind that you are usually unable to move anything into the house until after the closing. When you are preparing for your move, make sure you have scheduled movers for sometime on after the closing date. Besides scheduling the movers, you will also need to have all utilities put in your name. This includes gas, electric, water & sewer, cable, phone and internet, if you wish to have them. Usually, you need to have all the utilities put in your name as of the date of closing. Make sure you allow enough time for the transfer to occur- at least a week before you should have this done. Also, some companies may require a deposit if you have never had service in your name. You will also need to have homeowners insurance...

How to Make a Winning Offer

Once you have found the house you want, you need to make a written offer to buy it. There are many things to consider before you write the offer. You will need your pre-approval from your lender, an earnest money check( an amount of money you put down when making an offer to demonstrate your good faith, usually $1000 or more based on the price of the home) and a written offer to purchase that you will complete with the help of your Realtor. Obviously, the price you wish to offer is an important consideration but there are many other factors that may affect whether or not your offer is accepted. These other factors are called contingencies and they may sometimes be as important to the success of your offer as the price. If you are obtaining a mortgage to purchase the property then your Realtor will want to include a financing contingency. The bank will normally also require an appraisal of the property to be completed and therefore you will also need an appraisal contingency. If you are paying cash, you will need to decide if you wish to have an appraisal done, since it is not required. In the financing contingency, you will need to include the type of mortgage you are obtaining( conventional, FHA, VA, etc.) and the date by which you will be providing the seller with your final loan approval (typically 30 days or so). If you have already been pre-approved, the bank should have all the required documentation from you and will just need a copy of the final purchase contract and the...

The House Hunt

In my last column I discussed the first step in the home buying process: getting pre-approved with a lender. Once you have been pre-approved you will know what price range to focus your home search in and what type of loan you have been approved for. If you are getting a government backed loan product(FHA, VA or USDA Rural Development to name a few) your home search should be focused on properties that meet the criteria for that type of loan. Typically, foreclosure properties will not meet the standards that these loans require their properties to meet, so keep that in mind when doing your home search. Your lender can tell you what types of issues you need to stay away from but typically they are health & safety concerns. Peeling paint, broken windows, mold, un-safe wiring and in-operative furnaces are some examples of items that would affect your ability to obtain a mortgage on that property. Now that you have been pre-approved for a loan and know your price range, where do you start to find a home? According to the National Association of Realtors 90% of todayís homebuyers start their home search on the internet. With the popularity of such real estate websites as Realtor.com, Trulia and Zillow, home buyers can search a specific price range and location and immediately see what is available for sale from the comfort of their living room. These websites are useful tools for getting a market overview and a feel for what is available in your price range, but they are no substitute for touring a home in person. Before you...

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