If
your are paying rent, and have a steady job, you are on your way
to being a home owner. Interest rates are still very low and all
kinds of financial plans are out there to choose from - even if
your credit's no-so-hot. The "punishment" for iffy credit
is a higher payment rate: 7.0 instead of 6.5 for example.
And
know a Realtor is paid via a commission from the Seller - but
they serve you as the Buyer. Buyers should never pay a fee for
Realtor services; unless you chose a for sale by owner but want
an agent to represent you. Then you would pay a 3% fee direct
to agent for their expertise.
First
step (after choosing me as your agent) is to find out how much
you can afford to buy. You'll need to speak with a mortgage lender
and give them some income and employment information. They'll
tell you what you can afford to pay to a mortgage monthly. And
much of your "rent" is now tax deducible - you'll want
to talk to an accountant as well. The first stop is a job credit
union, or your checking bank, as they have a financial history
with you. Feel comfortable with your loan officer - or find another,
before you go forward.
Then
you'll ask the loan officer for a "Pre-Approved," not
"Pre-Qualified" letter. This tells a Seller you can
get the loan, and that you can afford to buy their home. They
will find this a stronger negotiation over a person who makes
an offer with no guarantee of funding. And, nowadays, usually
a Seller will not accept an offer without proof that you can get
a loan.
Money-wise,
you will need a down payment. Usually $500.00 to $1000.00 (often
more on horse properties). This is a good faith check, and is
held in escrow on behalf of yourself, and the seller.
You'll
also need money for closing costs (fees that ad up on both sides
to transfer ownership and document loans). These do vary based
on price of home and miscellaneous fees all transfers experience.
For the most part, think $2000 at least; the lower the loan, the
lower the closing costs. You can roll these costs into your mortgage
and stretch them out over the years (ask your lender and are aware
of the interest it would cost for this convenience).
The
fees can fluctuate - but you get an estimated "Closing Statement"
that lists Debits (The Home Price, Escrow, Attorney, Title, Home
Owner's Insurance, etc) and Credits (your loan, your down payment
and any additional funds/credits that occur) and there are no
secrets - you'll have a very good idea of the exact amount well
before your check is due.
You
call me when you have your Pre-Approval Letter and advise your
buying power (how much you can spend), and a list of your dreams;
3 bedrooms, a pool, no pool, a yard, hardwood floors and so forth.
I research and then off we go to look at possible dream homes.
When we find your home we'll make an offer (with a "good
faith" check deposit (usually a few thousand to show you
mean business). When the offer is accepted we go into Escrow and
begin the inspection period. You are given time to "look
under the carpet,” I will guide you before and through the
paperwork and terms.
Escrow
(time of an accepted offer - to time of ownership transfer) is
usually 45 days. In that time all the people working for you and
the seller do their work; from inspections to reports, funding,
and any maintenance that's agreed upon, to state and local documentation).
Once
you find a home with your agent, you will have to make a deposit
and schedule a home inspection. The home inspection is very important.
I have written a whole page with information
for you on this here->
The
home inspection discovers the good and the bad of your portential
home. After the home inspection is when you are truly on your
way to closing.
You'll
need to start re-routing your mail once it's certain you will
close. The things that can stop a closing are many. Your agent
will be sure and watch and offer guidance to avoid an unexpected
- avoidable - pitfalls. The mortage and the repairs are the number
one and two issues. You must also request all repairs be completed
by closing or request a credit. Sometimes (depending on your loan
amount 95% loan and above) the bank will not allow credits. Discuss
the options with your agent well before you get in this position.
Communicate
and work together. You have hired the agent to help you. They
are paid from a closed sale. The seller pays them but that doesn't
mean that they do not work for you.
Most
importantly enjoy this time of finding your new space. It will
be an investment in you.
Succinct
Tips:
10 Things to Take the Trauma Out of Homebuying
in Aiken
10
Questions to Ask Your Lender
Property
Tax Questions You Need to Ask
Call
me with any questions: 803-641-9957- CONTACT
EMAIL
Buying
a Home or
How Do I/We Start To Realize Home Ownership?