Karen Bellas asked:




Currently, we are experiencing a buyers’ market. This is a good time to be a first time home buyer as you can get more house in a better location for less money. In addition to that interest rates on mortgages are low. Still this is probably the biggest investment of your life and you don’t want to make a mistake. It can take between 30 to 45 days for the entire purchase process, although timelines vary according to individual buyer and seller circumstances.

Pre-Qualify Before You Look

Most realtors will not show you homes unless you pre-qualify, so they know that you are serious about buying. Gather past 1040s, bank statements, credit account numbers and determine how much you have for a down payment. Your realtor can give you a ballpark figure for the type of mortgage you will qualify and can steer you to a mortgage broker. Once you get a pre-approval status from your lender of choice, they give you a Loan Status Report (LSR). You can then determine what price range of homes to consider. If your lender pre-qualifies you for monthly payments you are not comfortable with, buy under that amount. You are the one that has to make that payment each month.

Start Looking at Homes Available for Purchase

Many people begin their search on the internet. You can save a lot of time by doing some research. Some people like to drive through their preferred neighborhood to see what is available. Be careful of ‘For Sale by Owner ‘ properties, many of these owners have unrealistic expectations of the value of their property. Once you have narrowed down your search, it is good to contact a realtor who can help you evaluate your choices and make an offer. They will know what comparable properties in the area have actually sold for, not just the list price.

Making an Offer

You submit a contract to the seller stating the amount you are offering along with the LSR so that they know you are serious. The seller may counter offer. Once both the buyer and seller accept the offer both sides are obligated to follow through. It is always contingent on the buyer getting their loan. Your realtor will monitor the process until closing.

Your Home Purchase Process Continues

You must put down earnest money and then begin the application for the loan. There will be a home inspection which can be paid for by either the buyer or seller depending upon the terms agreed upon. It is still possible to back out if the home inspection finds a problem that you and the seller can resolve. The lender requires an appraisal to make sure that the house has enough value to cover their loan should you default. Once the lender gives final loan approval, you are ready for closing.

Finally You “Close”on Your New Home

You will get to have a final walk through to make sure everything is the same. Then a title company prepares all the documents for the signing of both parties. The title company oversees all the document signing and delivers the title to you, the new owner. Move-in can be immediate or up 30 days depending on the agreed dates between buyer and seller.

Enjoy your new home!

Jeremy

William Buckley asked:




Purchasing a home can be overwhelming for the first time buyer. There are legal, financial, and even emotional issues that a first time buyer needs to be able to handle efficiently prior to purchasing a new/2nd hand home. One first timer tip is to read a lot of literature on the experiences either good or bad that others have made when purchasing their homes. This would at least minimize the chances of being disappointed or finding yourself in a position wherein you’re stuck with a huge mortgage in the wrong house. Below are even more tips you can note before purchasing your home for the first time:

Do not jump the gun – For a lot of people, planning to buy a home is exciting at the very least. Once people make that decision to actually purchase one, they also make the mistake of surfing the web 24/7 to snatch that great home deal; thinking that they would not get something better at a later point in time. This rush in purchasing a home, causes first time buyers to get stuck with a contract to purchase/build a house they don’t really like. Remember, if you purchase a contract to buy a house, you cannot simply change your mind and be simultaneously released from the contract.

Over-buying – For some first time home buyers, purchasing a house that is too big or too heavy financially to maintain is a mainstay mistake. There are situations in which the cost of maintaining the big house causes too much financial stress for the family. Make sure you know your financial limits because not everyone can live the life of a real-estate hungry celebrity. Leave yourself some room to breathe. Purchase a smaller house which you can maintain and put good furniture.

Not comparing mortgage rates – Be sure to explore ALL options before taking a mortgage. Rates, terms, lender, etc. are just some of the variables you have to take into account prior to taking a mortgage. Do not be dazzled by the “lowest” rates a mortgage broker gives you initially. This industry is so competitive that you can easily get a lower rate just by looking for the next mortgage broker. Take your time with this one.

Gladys

RJ Baxter asked:




Mistake #1: Not employing the services of a Realtor.

One of the most common mistakes I see is avoiding hiring a Realtor. Many first time home buyers think that a Realtor is costly and won’t help them much. Nothing could be further from the truth. The seller in your transaction pays the Realtor, so it won’t cost you a dime, and a Realtor can save you valuable time and money by finding properties you may not have been aware of and negotiating your contract.

Mistake #2: Not looking at enough homes.

Many first time home buyers will look at a couple of homes, get really excited, and then decide to make an offer, only to regret it. Even if you are extremely excited about a particular home, it’s a good idea to take a deep breath, and keep looking, at least at a few more. You may miss out on something even better by biting too soon on one of the first ones you see (my wife and I made this mistake on our first home).

Mistake #3: Taking the “lowest” mortgage offer.

It’s not difficult for shady mortgage brokers to show you a mortgage offer that seems a lot lower than everyone else’s. The new good faith estimate will help alleviate some of this problem, but the point still persists- keep in mind what you’re getting if you automatically choose your mortgage company based solely on the lower price. The adage “you get what you pay for” holds true with mortgage shopping as much as with any other product or service. Pay for a Kia, get Kia- you know what I mean.

Jean

Stephanie Larkin asked:


Buying your first home is exciting. No more rental payments to a landlord making money for someone else. Instead, you are purchasing your own home and investing in yourself. Money paid to your home mortgage is really investing in your future. It is no wonder that first time home buyers are so excited, sometimes so excited that they make mistakes. There are a few common mistakes of first time home buyers, which with some knowledge and direction can be avoided.

First of all, it is always good to research the housing market and see what is out there. Yes, the very first house you look at may look like its perfect, but there are others out there for sale too. Be sure to at least look at a few before deciding on the one you want to buy.

Watch the cost of the home, do not be swayed into thinking that you can not barter down the cost of the house, you probably can.

Insist on a home inspection by a qualified inspector. There are plenty of people who will provide you with a home warranty when you buy their house and try to sway you from having the house inspected.

Having a home warranty is important and many first time home buyers just don’t know that they should or could get one when they are buying an older home. Home warranties are not a new product; they’ve been around for many years, but many people think that they are for new homes only, not realizing that they can be purchased for older homes as well.

A home warranty makes great sense when you are purchasing an older home – you just don’t know the house very well until you’ve lived in it. A home warranty protects first time home buyers from major expenses for repairs and replacements that could come up.

A first time home buyer can make a major mistake if he or she does not understand that if something goes wrong, they are fully responsible to fix it. There is no landlord to call and the costs are all theirs to bear. This is one of the major reasons it is so important to invest in a home warranty when you purchase an older home. If any major repairs need to happen, most often the home warranty will cover the costs, making owning a home much more feasible.

When looking for a home warranty, it’s important to have a basic understanding of what you are looking for. When you talk to an agent, there are many questions that you need to ask to be sure you know what level of warranty you are getting. Questions to ask include:

What is covered with the home warranty? Most often the electrical system, plumbing system, heating system, cooling system/air conditioning, and major appliances that are covered under the warranty.

What is excluded from coverage with the home warranty? Most often this includes outdoor water, including the sprinkler system, faucet repairs, hot tubs, pools, spas and costs of hauling away debris and old appliances.

What are the rates/premiums? How much will you have to pay for the home warranty?

What is the deductible on the home warranty? The deductible is how much you will have to pay when you make a claim. Most often the deductible is $50, this amount will be deducted from the overall cost of the reparations paid by the warranty company.

How long is the warranty active for? Most often home warranties are offered in one year terms.

Is the warranty renewable at the end of the term? If you’ve purchased it yourself as the buyer, it is likely renewable. However, if the seller purchased the home warranty, it will not be renewable.

What are the terms of the warranty? When will the warranty be void? Most often if you’ve misused the item, or if it is not up to code or not installed properly, your warranty will be void and will not cover any reparations.

How are claims handled?

How do I make a claim?

With the above information, first time home buyers can avoid some of the serious mistakes that are usually made, and then go through with their home purchase knowledgeable and safe from the fall out of a potentially serious mistake. Mistakes such as the ones listed above can land a first time home owner in serious debt paying for repairs they were not prepared for financially. Owning a home of your own is very exciting, especially a first home, but make sure you go into it with your eyes open, your finances secure and a plan for the future should a problem rise with one of the major components of the home.



Howard