If you are thinking of buying a home, there are 5 things I would like to share with you that you should consider doing first:
1. Don't procrastinate when it comes to paying your bills on time! Pay on time and get your credit score as high as possible. The better your score, the better your interest rate will be on your new home, and therefore the lower your monthly payments. And DON'T close credit accounts when you pay them off. Your score can actually be higher if you have 3 accounts with $5,000 limits and zero balances, than to only have 1 car payment and no other credit accounts. And if your credit is not good, meet with a mortgage loan officer who can give you advice on how to repair your credit so you can buy sooner than later.
2. Don't start looking for homes until you meet with a Mortgage Loan Officer recommended by your real estate agent. It is free to get pre-approved for a mortgage! It is best to do this face-to-face, to ask questions, and explore different buying programs as there are many out there. They will explain all your options based on your credit, available cash, job history, and other conditions needed to get you pre-approved for a mortgage. The worst thing is finding the home of your dreams and discovering you don't qualify financially to buy it. Be sure your expectations can be met!
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3. Don't think you have to save 20% down before you buy a home! For every $1,000 you save, you may only save $5.00 a month in a monthly mortgage payment. There are zero or low money down programs, and with the assistance of the seller or lender, you can get all or some of your closing costs paid. Or if you have a blood relative, charity or fiance, to gift you monies to purchase, you can buy a home with very little cash out of your pocket so you don't have to save 20% or even 10%. There are 3% down programs and more! Talk with your real estate agent and mortgage loan officer about why it will be less costly for you to buy now. rather than to wait to save $5,000 or $10,000-even if you have to pay mortgage insurance for a few years. I don't know about you, but it would take me a long time to save $40,000 to buy a $200,000 house! Speak to a professional who can explain how the monthly payment is what you need to focus on, more than the amount of a down payment.
4. Don't search non-real estate company sites like Zillow to find homes. The house you may love to see was probably sold weeks ago because their data is not as updated as Real Estate company sites. Ask your agent for their mobile app or personal website that is updated and can be accessed from your cell phone. And don't rely on the "estimated home value" figures on those sites to make an offer. They are not a reliable source of current home values, ask your agent to do the research for you!
Find out what's happening in Lower Providencefor free with the latest updates from Patch.
5. Consult a REALTOR because it does not cost you anything- and they are trained to help you! They will explain all the contracts you will encounter, as well as what to expect for home inspections, lead paint, mold, radon, water and septic tests, disclosures, enhanced title insurance, negotiation strategies and more!!! They will explain why it is important to have an advocate on your side as a Buyer Agent-which does not cost you any more either! (In PA we practice Buyer Agency, but all states do not)
If you know of anyone thinking of moving, contact me at Kathy@Century21.com, I will be happy to help!
