First Time HomeBuyer Pitfalls

First Time HomeBuyer Pitfalls Tackling Common Mistakes and Misconceptions for First Time Homebuyers Common Mistakes and Misconceptions to Avoid Lack of Credit Check/Monitor your credit and fix any problems before you start looking at houses. Not knowing How Much They can Afford 620 Find a home with a monthly payment that you can afford. 100 200 300 400 500 600 700 800 You typically need a 620 credit score Talk with a to ualify for a mortgage! local mortgage Broker! Find out what monthly payment you can qualify for at today's mortgage rates. 3 Lack of Cash to Work With You'll need enough cash put away to cover most if not all of the following: Stuck in Lease Agreement Don't let a long lease drag you down: Down Payment. Earnest Money Deposit. Negotiate an early exit from the lease. Inspection and Appraisal. Expect to pay approx. 1.5 months' worth of Closing Costs. rent plus loss of security deposit to break the lease. Prepaid Interest. Typically 2-6 Months of Reserves Up Front Escrows for Property Taxes and Homeowners Try to Avoid finding sub-leasers or paying the entire lease off. Insurance. equal to your new house payment. Less than Full Commitment 6. Can't Find a Home Finding a home isn't a weekend "honey-do list" type of project. Find a home that fits your needs, not just your tastes. On average it takes 12 weeks of months 3i searching before finding the right home. Make a list of the basic essentials that your home needs to have, if you find that right home, pounce on it! Keep communication active with your Realtor and Lender. Realtor Not (7 Getting Job Done hall Down Payment When your Realtor doesn't fit your needs, give them the boot! Determine a down payment that fits your budget. Ask for a referral from your mortgage Broker or friends and family 20% If you put less than 20% down, you will have private mortgage insurance on the loan, which that have had a successful transaction with someone they loved working with. increases your monthly payments. 10 Too Busy at Work Lender Communication Find ways to be available during the week for your Lenders and Realtors. Keep your Lender in the loop during the entire process: Especially if you make other large purchases or sudden career changes. Even if it means spending your lunch break returning phone calls! 11 Emotional Attachment to a Home 12 Not Getting an Inspection Your new home has no feelings! Don't get emotionally attached to that kitchen. Home inspections are a no brainer Get One! Make sure the home you want to buy is in good standing. Stick to the facts. Get a true idea of what work needs to be put into it so you don't get in over your head. Making Your First Home Purchase a Success Conviction You Want To Buy A Home Get Pre-Approved with a Lender You can't get an offer accepted without one! Veigh out the pros and cons to buying vs renting. Understand how much home you can truly afford. Plan to live in the area for at least the next 5 years. Typically, it will take a few years to offset the upfront costs before you start to Handing documents provided by Lender with your offer will give the gain equity in the home. seller confidence to close the deal. Work With a Realtor Realtors have the knowledge and the negotiation skills to help you find a home that fits your needs. Stay Committed Throughout The Entire Process Stay dedicated and diligent. Plus, they are free! Their fees are paid for by the seller. In the start of the 2013 home buying season, bidding wars occurred at a peak of 75.7% of homes sold! 75.7% On average it takes 3 to 4 offers on homes before you get one accepted. Keep all financial statements handy ready for Lender when needed to start with application. Sources: http://www.firstcommercefinancial.com/first-time-homebuyers/ http://www.realtor.org/field-guides/field-guide-to-quick-real-estate-statistics http://blog.redfin.com/blog/2013/08/bidding-wars-continue-to-tumble-as-housing-market-rebalances.html FIRST COMMERCE EFI NANCIA L