Home Buyer Tips
Obtain a copy of your credit report. If you haven’t done so in a while, go to AnnualCreditReport.com and request your free copy. It’s important that you correct any errors on the report before starting the mortgage process.
Get pre-approved for a mortgage. Pre-approval is a good gut check on your price range for a home. Gone are the days that banks will fork over cash to anyone with a heartbeat. The best way to start is to ask friends for referrals from mortgage brokers and to shop around with banks and credit unions. Make sure to compare apples to apples and to ask the broker about your total costs to you at closing. You should also know that once you actually find a home, the mortgage process is on the same pain level as a root canal, only it requires more patience and there’s no Novocain. You’ll need to dig up tons of paperwork and fair warning — there will be multiple requests for even more documents as you move toward closing. Eventually, you will need a “commitment letter,” which details the terms of your loan approval.
Find an agent. Some folks might have the impression that realtors are a pain to work with, but it’s actually quite the contrary. It is tough to go through the home buying process alone and you will want to find an honest agent with experience and good connections with other agents. This partnership between buyer/agent or seller/agent will definitely make the process smooth and work in your favor.
Start with a fair offer. The offer should be based on similar homes selling in the area in the past 6 months. Your agent will help you with this process, but the offer should include the price you are willing to pay, your financial terms and contingencies, and your pre approval letter from a lender.
Hire a real estate attorney. This is a major transaction in your life, so don’t try to save money when it comes to legal fees. You will want to hire a good attorney with a lot of experience in the immediate area of purchase. They will protect your needs and make sure all of the legal documents are done correctly.
Schedule a home inspection. Think you’ve found your dream house? Maybe, but unless you have a certified home inspector walk through the premises, there could be some expensive surprises in store for you. Don’t be turned off if a problem arises during the inspection; it can often be addressed with a simple credit or adjustment in price. It’s imperative to protect yourself, and much like a real estate attorney, this step is worth every penny!
Purchase homeowner’s insurance. If you are a life-long renter, this can be an eye–opener in terms of cost. Make sure that you understand the difference between insuring the structure and insuring the contents. Additionally, if you are buying a home that is close to water, make sure that you have an agent who can help you enroll in the national flood insurance program.
Review your HUD statement BEFORE closing. The government document provides basic details about the involved parties and a lot of numbers. Mistakes do occur, which is why it is vital that you review the statement and confirm that everything is correct
Enjoy your new home! This is one of the proudest moments of your life…enjoy every minute knowing you are making moves towards a sound financial future for you and your family!