Tsue ~ That's What She Said: Five Tips for Home Buying ~ advice from experience

Wednesday, July 27, 2011

Five Tips for Home Buying ~ advice from experience

Five Tips for Home Buying

Another glorious vacation from the day job!  A stay-cation this time, working on some outdoor projects while the weather isn't 100+ degrees!

It's hard to believe we've been here three years already, but, at the same time, it feels as if we've been home forever.

Oh, those much anticipated house hunting days,
full of excitement and more stress than I could have imagined possible.  Despite initially thinking that our pre-hunt research prepared us for the home buying experience, we would have been lost without our agent!

The home market today offers an overwhelming amount of choices, not only a plethora of homes and styles to chose from, but financial options as well.  There is simply so much to consider!  Whether you are looking to buy your first home in Boston, upgrade or relocate to Dallas, considering a foreclosure in Boise or a short sale in Las Vegas, you'll want to ensure that you follow:

Five Tips for Home Buying

1)  Take a really close look at your household budget before shopping!  Create a list of all of your household expenses.  Spend some time considering the non-bill expenses that occur regularly and irregularly.  Take a peak at your bank statements from the last few months, taking note of meals out, vacations, birthdays, holiday shopping, seasonal clothes purchases.  Consider any possible employment changes or large purchases in your future.  Will you be replacing a vehicle in the future and how will that impact the flexible portion of your income.  Are you saving monthly?

Once you have a full picture of your income and where it goes, you'll be in a much better position to speak with your lender about what amount of mortgage you'll be comfortable with.

2)  Ensure you have money set aside for down payment and all the add on expenses.  Even if you work out a special deal with a buyer to pay all or some of your closing costs, you'll still have big expenses when it comes time to commit to your new home, many of which may come as an unpleasant surprise if you're not prepared.  From earnest money to submit along with your bid (at least $1000) to home inspection fees ($500 and up, depending on the depth of inspection you desire) a full year of home insurance, as well as appraisal fees, you need to have money set aside strictly for these purposes.  Even FHA mortgages for first time home buyer's require a 3% downpayment, which you may or may not be able to get assistance from seller on.  As with any financed purchase, the more you can pay down the principal, the less you will pay in the long run for your new home!

3)  Clean up your credit.  Even with today's low interest rates, you want to put your best financial foot forward when applying for a mortgage.  Check your credit reports for errors.  If you find any errors, be aggressive in contacting the companies and credit bureaus to get them removed.  Pay down all debt and credit cards.  Ensure you are paying your bills on time.

4)  Make a list of must-haves for your new home, but be prepared to compromise.  Consider neighborhoods, not only for the atmosphere and schools, but also for long term value outlook.  Up and coming or under revitalization may be a better long term choice than a bargain in an older neighborhood with excessive properties for sale.  Once you've created your list, run back through it thoughtfully, separating the "dream" points from two or three truly "must have" points.  Take a look online at what is available in your target areas to see the reality of what is available in your price range, with your top few "must haves".

5)  Find a reputable lender and buyer's agent that you are comfortable with.  This is too big of a commitment to go it alone.  Don't be afraid to interview a few before you decide who you'll work with.  Look at their track record, and, most importantly, your comfort level with them.  You need professionals who are available and will take the time to ensure you not only understand all the steps in buying your new home but further aren't rushed into this important decision.

My family was fortunate, in the end of our house hunt, although, in the beginning, we never thought we'd find "the one".  After "falling" for houses from online listings, only to discover they weren't right in person, to finding several that were "okay", we finally found our dream home.   My husband and I were growing weary of the hunt and had decided to view just a few more before taking a break for a few weeks when we found it.  A neglected foreclosure in a wonderful neighborhood, only blocks from our children's schools, with a large fenced yard  for my furry son, an in ground pool with mature landscaping creating a private, suburban oasis, fireplace, large master and finished rec room for the kids to entertain.  Of course, all the money we saved on the bargain price is being reinvested in renovations (refer to prior posts about the wonderful world of brass) but it's home.

As a participant in the Bucks2Blog campaign, I have been compensated in exchange for creating this feature.  The opinions above are both honest and my own.  Swatch Image.

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