First Time Home Buyers

Here are some tips to help you with the process of becoming your own landlord:

Pre-qualify for a loan

Being pre-qualified for a loan determines how much house you can afford. It also allows you to move more swiftly when you find the right house, especially when you aren't the only interested buyer.

Don't Go Shopping for a New Home Before You Know Exactly How Much You Can Spend!

You might have an idea of the loan payment and mortgage you can afford. But will the bank feel otherwise? It's always best to pre-qualify for a mortgage so you know exactly how much a financial institution would be willing to lend you.

In the pre-qualification process, you will find out:

    - Exactly how much home or land you can afford.

    - How much cash you will need for the down payment.

    - The minimum down payment, and advantages of higher down payments.

    - What the bank feels you can afford for a monthly payment

Shop for mortgage rates and terms

A difference of even half a percentage point can make a huge difference in how much you pay over the life of a loan. For example, the difference in the monthly payment on a $100,000 mortgage at 8 percent vs. 7.5 percent is about $35 per month. Over 30 years, that's $12,600.

Using a buyer agent

A buyer agent is legally responsible for representing the buyer's interest in a real estate transaction. Generally, the buyer agent is compensated by the seller at the time you purchase a new home. There are some limitations to using a buyer agent, however. Before you decide, have a Realtor explain the advantages and disadvantages of using a buyer agent.

Features that help or hurt resale value

In some areas, a swimming pool actually detracts from a home's value and makes the home harder to sell. In neighborhoods with two-car, attached garages, a single-car or detached garage may impact the home sale and future value. Your Realtor can point out features that hurt, as well as those that help, resale value.

Rate the houses you tour

After touring each home, write down what you liked and didn't like. Develop a rating system which will help you narrow the field down to the house that's the best for you.

Submitting Offers

Many of the offers we submit for prospective buyers aren't exactly what the sellers want; the price may be lower than they are asking or there might be terms that will require negotiation. What happens after the offer is submitted?  The seller's Realtor will present the offer to the sellers, along with the buyer's qualifications. If the sellers accept the offer, then you have a purchase agreement. If the sellers counter the offer, the next action would be initiated by the buyers. If you want to buy a particular house, your chances of succeeding are greater if your offer is as close to the asking price as possible. You could save money by engaging in lengthy negotiations, but you run the risk of losing the home if another offer comes in or you risk offending the seller.