Planning for Your Purchase

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?

We 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

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. We 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 monthly house payment. Be realistic here. Different loan programs have different requirements for maximum monthly payment. Talk this over with your lender.

Step Three: Get Pre-Qualified Or Pre-Approved

Apply On-Line in English or Spanish. You can save yourself a lot of time and heartache by meeting with a lender before you start your search for a home. 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". However; 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

Now that you know how much of a loan you qualify for you can look for a home that qualifies for the loan.

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. Ask as many questions as you can up front. By finding a good agent, you will save yourself lots of effort and time.

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).
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?
Can you represent me as my buyer's broker? 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.

Step Five: Find A Home That Meets Your Needs

Keep organized, record all your research data. Write down comments about the homes that you see. Keep track of your likes and dislikes.
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.
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.
You may want to spend time by yourself driving around looking at homes. Ask your agent for a list of homes to consider first from the outside. Your agent can make appointments later to show you the interior of those that appeal to you.
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.
Ask your agent to see "comparable sales" in the neighborhood. Knowing what other homes are actually selling for is essential to your making an educated buying decision.

Step Six: Make An Offer To Buy A Home

You and your real estate agent will write an offer to purchase the property. The offer will be presented to the seller who may accept the offer as written or may "counter offer". You then have an opportunity to "counter" the "counter offer" or accept the new or additional terms the seller has offered.

Step Seven: Save As Much As You Can On The Purchase

Six ways to save on your initial investment (includes down-payment and closing costs)

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.
Have someone give you money to pay closing costs. A blood relative, church or non-profit organization can give you money for closing costs.
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.
Do not pay too much insurance at closing. Some lenders want 14 months hazard insurance paid at closing. Others want 15 months. What happens to that extra money? It sits in your escrow account until you sell the house. It is safe here, but it often gains no interest.
Shop around for your home insurance. A little shopping can save you a lot of money.
You can deduct money paid for discount points from your gross income before computing your tax. Check with your CPA or financial advisor.

Three ways to keep your monthly payments low (includes principle, interest, taxes and insurance)

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.
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.
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 us first and get Pre-Approved in English or Spanish. We will help you decide how much you qualify for so there will be no surprises. 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. Find a Realtor®