If you are even thinking about buying a home, you need a buyer’s agent to represent your interests. If you have not signed an exclusive buyer’s agency contract, no one is working for you, only with you. As your buyer’s agent, my job is to get you the best possible home at the best possible price. I’ll negotiate for you the best price and terms and help you avoid costly mistakes.
As a buyer, you can hire me to represent your interests for free! That’s because the seller offers to pay the sales commissions for both the seller’s agent AND a buyer’s agent. That’s how REALTORS get paid.
As your agent, I’ll work hard finding you new homes to see. I’m also a communicator. Working with me, you’ll be informed and in control throughout the entire process. I’ll make sure your best interests are protected.
Please provide me with some basic information about what you’re looking for. I can send you a list of homes on the market that meet your criteria via email or snail mail. I PROMISE to ALWAYS protect your privacy. Period. And I’ll get back to you quickly!
By the way, there are no strings attached here. I provide this service complimentary with absolutely NO obligation. That’s because I want the chance to show you my expertise and dedication as a top, professional real estate agent. You’ll learn about my great personality and see just how accessible I am.
]]>1. Prequalification and pre-approval with your lender
2. Home selection
3. Presentation of offer to purchase
4. Acceptance or counter-offer
5. Receipt of earnest money deposit upon acceptance of offer which is deposited in our company’s non-interest bearing “Trust Account.”
6. Appraisal; property inspections; and repairs if necessary
7. Loan Approval
8. Title Company conducts title search
9. Deed preparation (by either seller’s attorney or title company)
10. Homeowner’s Insurance (through your insurance agent)
11. Calculation of closing costs
12. Closing of property; execution of all documents and recording of deed
13. Utilities transferred; keys exchanged.
Generally, homes appreciate about five percent a year. Some more, some less. The figure can vary from area to area. While that might not sound like much, consider this example: If you bought a $200,000 house, you didn’t pay cash. You got a mortgage, too. If you’re able to put down as much as 20 percent, you’ve invested $40,000.
At an appreciation rate of 5% annually, a $200,000 home would increase in value $10,000 during the first year. That means you earned $10,000 with an investment of $40,000. Your annual "return on investment" would be a whopping twenty-five percent.
Of course, you are making mortgage payments and paying property taxes, along with a couple of other costs. However, since the interest on your mortgage and your property taxes are both tax deductible, the government is essentially subsidizing your home purchase. Your rate of return when buying a home is higher than most any other investment you could make.
Some people are just lousy at saving money, and a house is an automatic savings account. You accumulate savings in two ways. Every month, a portion of your payment goes toward the principal. In the early years of the mortgage, this is not much. Over time, however, it accelerates. Renting gives you nothing to show for.
Second, your home appreciates. Average appreciation on a home is approximately five percent, though it will vary from year to year, and in some years may even depreciate. Over time, history has shown that owning a home is one of the very best financial investments.
Renters are typically limited on what they can do to improve their living space. Getting permission from the owner to make changes is often an uphill battle. Nor does it make sense to spend thousand of dollars painting, putting in carpet, tile or window coverings when the main person who benefits is the landlord and not you.
When you own, however, you can do pretty much whatever you want. You get the benefits of any improvements you make, plus you get to live in an environment you created.
]]>Don’t waste time. Yours or your agent’s. What good is it to look at homes that are out of your reach? Or maybe you can afford more than you originally thought! Spend your time wisely. The home you may fall in love with may have received an accepted offer an hour earlier.
Multiple offer situation? Pre-approval adds strength to your offer. Sellers are more likely to accept offers with pre-approval letters than one’s that don’t.
REALTORS prefer you get pre-approved. In fact, some agents won’t work with buyers until they’ve proven they’re qualified to buy. It helps get things off on the right footing.
Be informed. You’ll have an idea of what your monthly payment will be, allowing you to budget your money before making this large investment. It also helps show you what the down payment and closing costs will be.
]]>Lenders are concerned about the source of funds for your down payment and closing costs. You’ll likely be asked to show proof liquid assets, including checking and saving accounts, money market funds, certificates of deposit, stock statements, mutual funds, and even your company 401K and retirement accounts.
If you’ve moved money between accounts during that time, there may be large deposits and withdrawals in some of them. The mortgage underwriter may require a paper trail of all withdrawals and deposits making you to produce cancelled checks, deposit receipts, and other seemingly inconsequential data, which could get quite tedious.
Perhaps you become exasperated at your lender, but they are only doing their job correctly. To ensure quality control and eliminate potential fraud, it is a requirement on most loans to completely document the source of all funds. Moving your money around, even if you are consolidating your funds to make it "easier," could make it more difficult for the lender to properly document.
So leave your money where it is until you talk to a loan officer. Oh… and don’t change banks, either.
Changing jobs can negatively impact your ability to buy a home. This is especially true if a large portion of your income comes from bonuses, overtime or commissions. Switching jobs creates uncertainty about future earnings. Lenders rarely consider future bonuses as income unless you have been on the same job for two years and have a track record of receiving those bonuses. Then they’ll average your bonuses over the last two years in calculating your income.
If you’re considering a change to self-employment before buying a new home, you may want to consider buying the home first. Again, lenders like seeing a two-year track record of self-employment income before approving a loan. Plus, self-employed individuals tend to include a lot of expenses on the Schedule C of their tax returns, especially in the early years of self-employment. While it reduces your tax obligation to the IRS, it also reduces your income to qualify for a home loan.
Don’t do it. When determining your ability to qualify for a mortgage, a lender looks at your "debt-to-income" ratio. This is the percentage of gross monthly income (before taxes) you spend on debt. This includes monthly housing costs (that’s principal, interest, taxes, insurance and homeowner association fees if any). It also includes your monthly consumer debt, including credit cards, student loans and car payments. Any large purchase can negatively affect your “debt to income ratio” making it more difficult to qualify for a loan.
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