Everything you want to know about buying a
home.
Print out this section and review
it at your leisure:
1.
Should you buy a home now?
2. What price home can you afford?
3. How do you find the right home?
4. What do you do when you find the house you want?
5. What do you do after your offer is accepted?
6. What will your mortgage lender need to know?
7. What happens at the closing?
Should you buy a home
now?
One question many people ask is "Should I
buy a home?," or more specifically, "Should I buy a home
now?" My company has always felt the answer to that
question is "YES." The reasons are simple...
- The price of new and resale homes has
steadily increased ever since the mid-40s.
Delaying the purchase simply
allows prices to go higher.
- As the price of housing increases,
your equity also grows.
Equity is defined as the amount
of cash that you have when you eventually sell your home after all
the mortgages and claims against the property are paid off.
The sooner you purchase a home, the faster your equity will start
to accumulate.
Ultimately, that means you'll have more cash available to put into
your next home or other investment.
- Home ownership offers tax benefits
not available to renters.
Special tax deductions for
property taxes and interest could mean a decrease in your year-end
income tax expense. Ask your tax consultant for specific
information on how home ownership can impact your taxes.
- Buying a home makes sense -- even in
periods when interest rates are high.
One question many consumers ask is
"Why don't I wait until the interest rates come down and then
buy?" The fact is, home buying can be practical and profitable
even in periods when interest rates are higher. First of all, many
creative financing options are available that help leverage your
funds and get the most for your money. Secondly, if interest rates
do decrease substantially after purchasing a home, you always have
the option of refinancing at the lower rate.
There are many other benefits to
buying a home now. Call or e:mail me today and I'll send you specific
mathematical examples that demonstrate how buying a home is always a
good investment.
What price home can you
afford?
Most people use financing of one type or
another to buy a house since they do not have the cash available to
cover the full purchase price. The price you can afford will depend
upon how much cash you have for the initial investment, or down
payment, plus the amount of loan you can afford based on your income
and debts.
My advice is to let a professional loan
officer determine what price works for you before you start looking
for a home. After determining the price range you can afford, I can
then work with you to clarify your desired home features and show you
the homes and neighborhoods that best suit your needs.
How do you find the
right home?
Many people think that going through real
estate ads is a good way to find a house. More often than not,
however, searching the classifieds results in few -- if any -- solid
leads. Limited and sometimes misleading ad descriptions can mean
hours of time and effort researching homes that simply don't meet
your needs.
There is a better way! That way is to work
with me, at absolutely no
cost or obligation, to find the home
that's right for you.
Through an in-depth personal interview,
we'll fine-tune your area preferences, desired style, needed
amenities, and everything else you really want in your new home.
Then, using this criteria, I'll conduct a targeted search through the
Multiple Listing System.
The Multiple Listing System is a massive
home database used exclusively by real estate agents. It includes
detailed information on all Tampa-area properties (including
Hillsborough, Pinellas and Pasco counties) currently available for
sale through real estate brokers. Using the Multiple Listing System,
I can quickly access information on homes that most directly meet
your needs.
After a thorough search, I will provide you
with detailed information on homes that match your criteria,
including photographs, pricing, special features, property tax
information and more. With this information in hand, you can choose
the specific homes you want to see. I'll then make arrangements for
us to tour each of these homes within a short period of time so you
can get an even better idea of what you want.
I suggest you jot down notes and
discuss your likes and dislikes with me as you go through each home.
Always ask questions and bring up any objections you may have about a
particular home. In addition, make sure you ask me any questions you
have about community associations, schools and transportation around
the area.
Working together, we can quickly narrow your
search and find the right home for you without a lot of hassle. No
more searching the classifieds. No more unnecessary phone calls. No
more wasted effort viewing "too good to be true" homes that simply
don't suit your needs.
What do you do when you
find the house you want?
Once you've found the right home, we will
complete a Contract for Sale/Offer to Purchase stating exactly what
you're willing to offer with regard to price, down payment, deposit,
financing, and all other details. Although the contract may at first
appear complicated, it typically encompasses many protective issues
and I will review it with you thoroughly.
In addition to the Contract for Sale, I will
prepare an Estimated Settlement Expense Sheet so you will know what
your expenses will be before you sign the contract. This sheet will
include estimated fees for recording, property appraisal, location
survey, title search, etc.
After you have signed the contract, I will
give it to the listing sales associate to present to the seller.
Sometimes there are counter offers by the seller indicating a change
from your original offer. The contract goes into effect when there is
a clear "meeting of the minds" on every point, and
after both you and the seller sign off on the final agreement.
What do you do after
your offer is accepted?
Between the time the contract is signed and
the time of the actual settlement, various steps must be taken.
Typically, these are as follows:
- The buyer meets with the lender to
formally apply for financing.
- The buyer orders a home inspection and a
termite inspection with the assisstance of his/her sales
associate.
- The seller arranges to have all agreed
upon repairs completed.
- The lender orders an appraisal to make
sure that the value of the house is in accordance with the amount
of the loan.
- The title company orders a property
survey.
- The buyer and lender work together to
facilitate approval of the buyer's financing.
- The buyer and seller, through their
sales associates, establish the date, place and time for
settlement.
- Prior to closing, the buyer "walks
through" the property to ensure everything is in working order and
the condition of the property is acceptable.
What will your mortgage
lender need from you?
After your offer has been accepted, you'll need to officially
complete a mortgage application for your mortgage lender. Your lender
may ask you to supply the following:
- A copy of the signed purchase
agreement.
- Residence address(es) for the last two
years (including landlord mailing address(es), if you rented and
the mortage lender's name, mailing address and account number if
you owned a home).
- Name, address, and phone number for each
employer for the past two years.
- Documentation of income from all
sources, including pay stubs for the past month, W-2 forms for the
past two years, plus an itemization of income from social
security, pensions, stocks, bonds, alimony and child support if
your loan amount is dependent on these items. If self employed,
copies of the last two years' federal tax returns (personal and
corporate) plus a current financial statement through the last
business quarter.
- Names, addresses, account numbers, and
balances for all checking and savings accounts plus copies of the
past three months of statements.
- Names, addresses, account numbers,
balances, and monthly payments for loans and credit cards.
- Information about other real estate you
own, including lender, loan amount, balance due, account number,
and market value.
- Information on all other assets and
their market value.
- Information about previous bankruptcy
(if applicable), including discharge, a schedule of debts, letter
of explanation, and list of accounts that were reaffirmed.
- VA Customers: Certificate of Eligibility and a copy of your
DD-214 (Discharge).
- FHA Customers: Copies of Driver's License (or picture ID) and
Social Security card.
- Construction: Varies with lender
Please remember that the
list above is a guideline and
your particular lender may require more information. Some fees may be
required.
What happens at the
closing or settlement?
The settlement, or closing, is a time when
buyers, sellers, real estate agents and the bank's representative
sign all of the final paperwork to transfer a title from one owner to
the next. The actual closing is usually performed either at the title
company, bank, attorney's office or real estate office.
At this time the buyer brings the check for
the cash down payment, the bank brings the check for the amount of
the mortgage, and the seller brings the keys to the house. The seller
signs the deed over to the buyer. In addition, various documents
relative to federal law are signed and a settlement sheet outlining
all financial transactions is drawn up and reviewed so each party
understands its costs.
It's always good to talk to me before the
settlement to get a clear understanding of exactly what will happen.
Typically, when you leave the settlement table, you'll have the keys
to the house and you can take possession of your new home!
