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Tips to know for buying your first or next home


Are you planning to buy a home this spring or summer? Now is really the time to start planning to make sure you are well prepared to get the best rate, price and have the best experience.  And, you will want to be the most attractive buyer in a seller’s market.
 
What should be the first step in the process of buying a home?
First, decide for sure that you really want to move into a new home.  It starts with deciding why you want to move, is it for more space, better schools, closer commute or to own instead of renting.  Then you have decide if buying a home solves your primary reason moving.
 
What are costs with a new home, whether it’s your first or your third, that are often missed?
New homeowners don’t normally take into consideration property taxes, homeowner’s insurance and the maintenance cost of owning a home.  Existing homeowners often miss that property taxes, utility costs and even homeowner’s insurance are likely to be higher in a new home.
 
What is a good rule of thumb for how much how your housing costs should be compared to your income?
If you include your mortgage payment, maintenance costs, utilities and insurance, you should keep your monthly housing costs to 30% or less of your gross monthly income.  And depending upon your potential income changes in the next 3 – 5 years, you might choose to even lower that number to 25% or less.
 
Once the decision has been made to buy a home, what’s next?
Next, you must determine if you are going to buy an existing home or build a new home.
Reasons to build – constructed with new materials, the house is more customize to you and you avoid renovations that might be needed in an existing home.
Reasons to buy – more negotiation room on the price, existing homes are usually move in ready, and the sales process might be a shorter.
 
Having the down payment is a critical element of buying a home, what are the options available?
First, the down payment for some mortgage loans can be as little as 3% and another great option is that it can even be a gift from a family member.  It is important to remember, the more you have down, the better rate and loan terms you are likely to be able to obtain.
 
Buying a home is a complicated process, who should we have on our home buying team?
There are two important resources for buying a home.  A realtor who can help you find and negotiate the best deal and make sure that there are no surprises.  The other important member is a mortgage lender who will work with you to find the best solution for your financial situation.  Not all realtors nor mortgage lenders are the same.  Be sure to select those that understand your needs and situation.
 
How can someone become an attractive buyer to a seller?
There are three key ways to be able to have most negotiation power when buying a home.
  • Be Flexible with dates on closing and taking possession of the house
  • Be pre-approved for your mortgage so that you can close quickly
  • Don’t have contingencies like needing to sell your current home if you are a homeowner
 


Posted: 2/18/2016 with 0 comments

Categories: Homeownership, Money Matters



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