You are ready to buy your first home. It’s a really exciting time for you. Here are some things to remember that will help keep you out of a home you can’t afford.
Contact several banks to see who can give you the best rate. Be sure to only inquire about fixed rate mortgages. Chances are if you accept anything other than a fixed rate mortgage, you won’t own your home 5 or 10 years down the line.
You will need any proof of income, check stubs, income tax returns, child support received, etc.
The bank you choose will then pre approve a loan amount for you. This is the amount they are willing to loan you for the purchase of a home. Ask them for a statement of pre approved loan amount. You may find this document will come in handy.
You may want to start simply by searching the Internet to see what’s out there in the area and price range you want. One great resource is Realtor.com. You can put in a price point, zip code, type of home, etc., and do a search. It will list the homes available. Most will have pictures of the outside and inside of the house, as well as square footage, school district and other helpful information.
You can then go visit the homes you are interested in on your own. Drive by and if it appears vacant, peek in the windows. If it appears occupied, don’t stop and knock on the door. You will at least get an idea if the neighborhood is appealing to you or some place you would rather not want to live.
You may also want to contact the local police precinct in the area that you are thinking of living and get the low down on the crime rate in that neighborhood.
Another way to scope out the neighborhood is simply to drive by the convenience stores around 7 or 8 pm. If you see a lot of undesirable people hanging out, you may want to reconsider that area.
Once you get a basic idea of what is out there for you, call a Realtor.
If you see a Realtor sign on a home you like, or a Realtor name on one of the Internet sites that is representing the seller, don’t call them.
When a Realtor represents a seller, it can be tricky for them to get you, the buyer, the best possible deal. This is because they are working both sides of the fence and will also make double the commission for being buyer and seller agent.
Choose a Realtor, and when you do be sure it’s someone who seems to like their job. Someone who listens to you and doesn’t make you feel like a bother to them. Choose someone who returns phone calls promptly and noticeably makes the time for you.
You can ask the agent to show you the homes you found. You can also ask the Realtor to do a search from her database of properties and select other homes in your price range and with most of your specifications.
The agent will make appointments with the owner of the homes you want to see and the owner will not be present when you walk through. This is thought to give the potential buyer a better look at the house. When you walk through, you can open cupboards, closets, toilets, look in the shower, and do all the snooping you feel necessary. If the owner is present, potential buyers don’t fell as comfortable really getting in there and taking a good look at the place.
Look around the house. Notice if there are any highways or high traffic streets that may disturb you. See if the neighboring homes look clean and kept up, scope out the back yards as well. Make some noise when you are out looking at the yard. This may alert any dogs in the area that may be a barking nuisance, and something else you may want to consider. Simple things like this will make your final purchase easier to live with.
Some Realtors will suggest or show you homes that you simply cannot afford. Why they do this seems to be greed to me. If your agent attempts this, get another Realtor. If your Realtor isn’t trying to get you in to a property that is within or under your budget, he or she is not working for you and not doing the best job for you. Bottom line.
When you decide you have found your dream home, you will begin negotiations to purchase it. There will be an “asking price”. You will normally want to start lower than that asking price and offer what you feel is a fair amount. You will want to have an inspection of the home. The inspector is trained to find issues that may cost you a lot of money in the future to fix. Take in to consideration any repairs that you will have to pay for, or put in the contract those repairs must be taken care of by the owner before the sale is final.
The seller may not like your offer and you may go back and forth a few times hashing things out until both of you are satisfied with the deal. Or, you or the seller may totally not want to negotiate further and your search will continue for the home of your dreams.
There will always be features you like about a more expensive property, but it’s a big risk to overextend your financial means to buy a home you know is not affordable in the long run.
You may dream of a 3 bedroom, 2.5 bath with a 2 car garage. Are you willing to settle for a 3 bedroom, 2 bath with a carport? These are the kinds of things you may have to decide on when making your final decision.
You may literally look at dozens of properties, and spend several months or more before you find what you are happy with. Don’t get discouraged.
Remember, when you become a homeowner, you will be footing the bill for any repairs or issues that come up. There is no landlord to call when the toilet backs up or the roof leaks. Keep in mind that you will need money for those things. You will also need money for any upgrades that you may want to do. So don’t get yourself in over your head, be wise, and think long and hard before signing your life away. Any Realtor who tries to talk you in to a home you like but can’t afford is doing you a disservice.
Your Realtor should be a know all of any information you need about the inspection process, the mortgage process, and should fight for you during contract negotiations. A good Realtor won’t normally give up easily if he or she knows you really want that property.
If you have a good Realtor, it will make the whole process a little easier to deal with.
Good luck and enjoy your new home!