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Mortgage Loan Resources > Planning to Purchase A Home
Planning to Purchase A Home
Buying a home can seem like a frightening prospect.
Whether it's your first home or your fifth, so much is at stake - your
savings, your credit rating, your financial freedom - it's difficult to
find the courage to sign on the dotted line, even if you want that home
very, very badly.
- How do you determine
whether or not
the purchase of a home makes sense?
- What's the easiest way to
examine the whole picture from emotions to economics?
I suggest that you read this entire report before
you go house hunting. You'll discover
how to separate whims from true needs. You'll discover how to prepare
a game plan for your real estate venture, how to research effectively,
choose wisely, finance appropriately and survive the whole procedure
with your smile intact.
| Seven
Steps For Success: |
| 1. |
Establish your needs
and wants. |
| 2. |
Determine how much you
can afford. |
| 3. |
Get pre-approved or
pre-qualified by a lender. |
| 4. |
Find a good real estate
agent to help you. |
| 5. |
Find a home that meets
your needs. |
| 6. |
Make an offer to by
a home. |
| 7. |
Save as much as you
can on the purchase. |
By the time you've done your homework and completed
the suggestions in this report, you will have an excellent overview of
how to find and buy your dream home. Along with that you'll have plenty
of confidence to back up your decision to buy that special home too
 Step
One: Establishing Your Needs And Wants
Begin a search for a perfect home by making a careful
assessment of what kind of a home you need and want. I recommend that you
do this in writing. So take the time, right now, to be as specific as you
can about your particular requirements.
Steps
Two: Determine How Much You Can Afford
Set up a budget for yourself. Decide how much you
can really afford to invest monthly for your house payment. Be realistic
here. Different loan programs have different requirements for maximum monthly
payment. Talk this over with your lender.
Use the payment
calculator or comparison
calculator to help you in this area.
Step
Three: Get Pre-Qualified Or Pre- Approved By A Lender:
APPLY
ONLINE You can save yourself a lot of time and heartache by meeting
with a lender before you start your search for a home. A lender can
let you know what specific loan programs would be best for you. They
can also help you understand what it takes to qualify for the loan you
want.
By taking a look at your financial situation and looking
at your credit history, a lender can usually give you a good idea if you
can qualify for the loan you want.
Many lenders call this "Pre-Qualifying
A Buyer". If you would like to be certain that you can be approved
for a loan, you may want to ask to be pre-approved. In the approval process,
all of your documentation is completed and submitted to an underwriter.
The pre-approval that you will get back is an actual
loan commitment from a lender. This means that you will definitely qualify
for a loan. Talk to your lender about the costs and times involved, as
they are different for each lender.
The next step is finding a home that also qualifies for the loan.
Step
Four: Find A Good Real Estate Agent To Help You
You can learn a lot about an agent by just letting
them talk to you about how they help buyers. Within a few minutes, you
will probably be able to determine if their style is compatible with yours.
| Questions for
agents: |
| 1. |
Are you knowledgeable about the area of town
and price range that we are interested in? (Some agents specialize
in only one area or one price range). |
| 2. |
Do you have the time to work with us? (This
is especially important if you're on a tight deadline). What procedure
will the agent follow in working with you? How often will they update
you with the new property listings? |
| 3. |
Can you represent me as my buyer's broker? |
Ask as many questions as you can up front.
By finding a good agent, you will save yourself huge amounts of effort.
Step
Five: Find A Home That Meets Your Needs
| Five tips for
successful house hunting: |
| 1. |
Keep organized, record all your research data.
Write down comments about the homes that you see. Keep track of your
likes and dislikes. |
| 2. |
Make sure that your agent is aware of your
time schedule and expectations. Do you like to look at one to two
homes in a session? Four? Eight? Discuss this with your agent. |
| 3. |
Tell your agent about any homes you see that
interest you and that you'd like to know more about. This includes
homes that you've "discovered" as you've explored the area
yourself, or those advertised in the newspaper. |
| 4. |
You want to spend time by yourself driving
around looking at home, ask your agent for a list of drive-by's homes
to consider first from the outside. Your agent can make appointments
later to show you the interior of those that appeal to you. |
| 5. |
Express your likes and dislikes to your agent
after looking at a home. Honest communication is essential. Many
buyers are shy and afraid to tell an agent what they really think
of a house. They think the agent might take it personally. Remember,
the homes don't belong to the agent! You must be straight-forward
about your likes and dislikes in order for the agent to do the best
job for you. |
Step
Six: Make An Offer To Buy A Home
Your real estate agent can help you make an offer
to buy the home that you. It is important to know beforehand who your agent
represents.
Some agents work only for the seller. In this case
the agent may not be able to advise you what is a fair offer.
By looking at what homes are selling for in the area
and how long they are taking to sell, you should be able to get a good
idea of value.
Step
Seven: Save As Much As You Can On The Purchase
There are only two major investments to consider when
buying a home. These are the initial investment, which includes down payment
and closing costs and the monthly payment, which includes principle, interest,
taxes and insurance.
| Here are six
ways to save on your initial investment: |
| 1. |
Chose a loan down payment loan. You do not
necessarily have to put 20% or even 10% down. You can put 5% or even
3% down on some loans. |
| 2. |
Have someone give you money to pay closing
costs. A blood relative, church or non-profit organization can give
you money for closing costs. |
| 3. |
Ask the seller the pay some of your closing
costs as part of the offer. Sellers are usually allowed to contribute
to a buyer's closing costs. |
| 4. |
Do not pay too much insurance at closing. Some
lenders want 14 months hazard insurance paid at closing. Others want
15 months. |
| 5. |
Shop around for your home insurance. A little
shopping can save you a lot of money. |
| 6. |
You can deduct money paid for discount points
from your gross income before computing your tax. Check with your
CPA. |
| Here are three
ways to keep your monthly payments low: |
| 1. |
Get a loan that doesn't have monthly mortgage
insurance premiums. You may be able to reduce or eliminate them by
paying a little more at closing. By putting 20% or more down, you
can eliminate them entirely. |
| 2. |
Remember that interest payments on a primary
residential mortgage are fully deductible in most circumstances.
Your property taxes may also be deductible. Tax rates definitely
favor homeowners. |
| 3. |
Chose an adjustable Rate Mortgage. ARMs can
be up to 3% lower than fixed rates. |
Now that you have finished this report, it is time
to go out and find the home of your dreams.
See a lender first.
They will help you decide how much of a loan that you will qualify for.
Find a good agent to work with. If you don't have one, ask your friends
and work associates for a referral or we can always refer an agent to you.
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