Tips To Help You Buy a Home

1. To buy, or not to buy, that is the question. People choose to buy their own home for any number of reasons. Why pay rent when you could be paying the money towards a home that is actually yours? Buying a home is one of the biggest investments many people make in their lifetime. Over time, property usually increases in value. As your mortgage is paid off, you receive equity in your home. Equity is the difference between the value of the property and the liens against it. So for example, if you buy a piece of property for $120,000 and the total amount of the loans you have on the property comes to $100,000, you have approximately $20,000 in equity in your property. You can borrow money off of the equity you have in your property.
   
   
2. Be realistic: Finding the balance between what you want and what you can afford.
   
   What you want. Most everyone wants to get the most house they can get for their money. With all the houses on the market, it can be difficult to know which ones to look at and which ones you should not waste your time with. To help you narrow down the selection, make a list of the things that are most important to you. What kind of location do you want to be in? How many bedrooms do you need? Do you absolutely have to have a fireplace? Make your list a wish list and write down everything you can think of that you would want in a house. Then take that list with you while you look at houses and take notes on each one.
   
   What you can afford. Have your real estate agent help you determine how much of a house payment you can afford every month by looking at your income and expenses. The important thing to remember when shopping for a house is that most likely you will not find a house with everything on your wish list. That’s ok! The home will be your and you can always make changes to it later, especially if they are minor. In other words, if you find a house with most everything you want except for that ugly carpet, don’t let the carpet be the only thing that keeps you from making that purchase. Besides, you may be able to work out a deal with the seller to include the price of new carpet installation as a credit to you at closing.
   
   
3. Do your research! The key to finding the mortgage that is right for you. In order to get the best loan terms, doing your research is a must. Your real estate agent can help walk you through the process by helping you to understand the differences between the various types of loans. Be sure to ask about home buying programs that you might qualify for. Each state has different programs designed specifically to help home buyers. These programs can help lower your interest rates, help you get a down payment, or even enable you to pay no money down in some cases. FHA loans are a good option for first time homebuyers. The FHA insures the loan to enable your mortgage company to offer you a lower interest rate. Be sure to check with a qualified FHA lender.
   
   
4. Make them an offer they can’t refuse. When making an offer, a real estate agent can help you come up with the best plan on how to approach the situation. It is important to have an understanding of the area market and it helps to know how long certain houses have been on the market. For example, if a house has been on the market for a couple of months, they might be more prone to accept a lower offer than a house that has been on the market for a week. A good agent understands this and has access to that type of knowledge. It is important to sit down with your agent and go over the contract to catch any potential problem areas. Simple things like making sure the address is correct and making sure the numbers add up, can slow down and complicate the home buying process if such minor issues are neglected.
   
   
5. Protect yourself! Get a home inspection. A wise buyer will make their offer contingent upon receiving a home inspection. This means that if there are major structural issues with the house found in a home inspection, the buyer has the right to rescind the contract. In other words, they could void the contract. Home inspections protect the buyer from getting ripped off by a dishonest seller.
   
   
6. Shop around for good insurance rates. No one enjoys shopping for insurance, but it is important to find an insurance policy that offers the coverage you need at the reasonable price. Be sure to ask lots of questions about what the policy covers to make sure it fits your needs. Certain types of coverage, such as flood and earthquake insurance, are often drawn up in separate policies. Find out how much your premium would be and ask how the claims are handled. Does it take a few weeks for them to process a claim or can they do it in their office? Also, many insurance companies offer discounts to lower your homeowner’s insurance if, for example, you keep a fire-extinguisher in the kitchen. Find out as much as you can before you make a decision.
   
   
7. Closing time! Finally, after much preparation, the day you sign the papers to buy your new home arrives. It can be an exciting time, especially for first time home buyers. To ensure that closing goes as smoothly as possible, go over all the documentation with your agent to make sure that everything is in order before closing day. Look for potential problems in the contract and make sure all the final arrangements have been made for you to take possession. Happy house hunting!