Home Buying Tips

homeTen things you should know when purchasing a home.

 

1. Wait to purchase if you’re unable to stick with the home for a while.

If you’re unable to remain in a home for a minimum of a couple of years, then buying may not suit your needs. Escrow fees, REALTOR commissions and possible repairs could cause you to take a loss if you had to sell sooner than you planned. In a stable housing market, you may have some equity to cover the expenses, but in a declining market you could find yourself in a world of hurt.

 

2. Get a head start on cleaning up your credit.

Odds are that you’ll need to obtain financing to buy your home.  If your credit is not up to par, you can forget about getting a loan.  You can run one free credit report per year through a government sponsored website at annualcreditreport.com.  After you get your results you can dispute all the negatives and within a few months they’ll start to drop off and your credit will improve.  The dings that are not removed can be settled or paid off through the debt holder.

 

3. Stay within your budget.

As a general rule, you should be looking at homes that cost 2 1/2 times your annual salary. However, there are many online mortgage calculators that can assist you in determining what you can actually afford.

 

4. Don’t have the 20% to put down?  You may still be able to buy a home.

Numerous public and private lenders can provide low-interest rate mortgages for as little as three percent down.

 

5. Purchasing in a good school district is important.

Although you may not have children that go to school, many home buyers use school districts as their primary reason for purchasing a home in a particular area. When you decide to sell, you’ll realize how important this factor is to buyers.

 

6. Use a REALTOR.

REALTORS belong to an association that provides training and oversight, far beyond that of just a licensed real estate agent.  Look for a REALTOR who has experience, references and has shown that they have provided excellent service to other home buyers.  The best part (if you’re a buyer); REALTORS services don’t cost you a penny!

 

7. Points or Rate?  Select carefully.

When choosing a home loan, you typically have the choice buying down points (interest that you’ll pay at the closing of escrow) in return for a reduced interest rate. If you plan on being a long term resident (at least 5 years), it can be worth it to take the points.  A lower interest rate over the life of the loan can save you a lot of money.

 

8. Get pre-approved by a reputable lender before you start looking.

You’ll save yourself a lot of time and headaches by following this tip.  There is no point in looking at homes that you’re unable to afford.

 

9. Research before submitting an offer.

Your initial offer should be based on the comparable properties that have recently sold in the same area.  This is where your REALTOR can help you avoid overpaying for your home by supplying recent sales within 3-6 months of your offer.  Make sure the comps accurately reflect the location, square footage, lot size, upgrades, amenities bedrooms and bathrooms.

 

10. Get a physical inspection.

I can’t stress this enough to my buyers.  Hiring and inspector for $200-$400 can save you from making the mistake of buying a home that is need of thousands of dollars in repairs.

 

For more assistance on Home Buying, please click here.

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Category : Blog &REALTORS

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