Thread: First step to buying your home

The first step toward buying a home is understanding your financial picture. Figure out your monthly income and budget, including regular and incidental expenses. If you expect any changes that will affect your income over the next year, such as a raise or a new car, make a note of that as well. This will give you an accurate picture of your finances to help determine how fast you can save for a down payment.

First you should determine if you are ready to buy a home. Home ownership is a lot more expensive than renting. You are responsible for paying for all the repairs. You may also have added utility costs, such as garbage and water. In addition to that you will need to pay for taxes and insurance related to your home. These costs add up quickly, and if you are not financially prepared, you may end up in a very negative position. You should take the time to get out of debt and save up an emergency fund, before you purchase your first home. You should definitely get rid of all of your credit card debt first.Second you should begin to shop for a loan.

The step of number one would be to go shopping for a mortgage. This may seem back to the shop for a mortgage before you shop for home, but there are many reasons for this. One of them is that you will find our how much you can borrow, which has much in common with the house, how much you can buy. Be careful not to allow the creditor to you in your monthly payment you do not feel comfortable.

1. First you should determine if you are ready to buy a home. Home ownership is a lot more expensive than renting. You are responsible for paying for all the repairs. You may also have added utility costs, such as garbage and water. In addition to that you will need to pay for taxes and insurance related to your home. These costs add up quickly, and if you are not financially prepared, you may end up in a very negative position. You should take the time to get out of debt and save up an emergency fund, before you purchase your first home. You should definitely get rid of all of your credit card debt first.
2. Second you should begin to shop for a loan. You need to get preapproved before you shop for a home. This will help you to look within your price range. You should contact at least three people before you decide which loan to take. A mortgage broker will look at several different loan companies to find you the best rates. However, your small local bank or your credit union may have options that will save you money as well. Once you find a loan with the correct terms you can begin shopping.
3. When it comes to your mortgage you may be surprised at the different loan types and payment options available to you. It can be baffling when you think about ARMS and PMI. Usually a fixed rate fifteen or twenty year loan is the best option. This can help you lock in a low rate. You may be considering creative financing to cover the down payment, but you should be careful when you make these choices. You want to build wealth with your home purchase. If you make the wrong choice than you may end up hurting yourself financially.
4. You also need to determine how much home you can really afford. A good rule of thumb is to keep your mortgage along with your taxes and insurance between twenty five and thirty percent of your income. Other experts advise that your home cost be limited to two and half times your annual salary. It can be crippling if you are house poor. If you spend too much on your mortgage you may not be able to meet your daily obligations let alone save for retirement. A smaller house is worth the peace of mind.
5. Once you have determined how much you can really spend and are preapproved you should find a good realtor. Your realtor should listen to your wants and needs carefully. She may make recommendations or explain the market to help you find a home that suits your needs and that you can afford. She should offer several different options. Once you make an offer your realtor should work to negotiate terms that you are happy with. A good way to find a realtor is through the recommendations of friends and colleagues.
6. Another important step is a thorough home inspection. This is different from an appraisal. You should pay for the home inspection. The home inspector will look for hidden problems with the home. Through the home inspection you can learn about any issues that may prevent you from buying the home. This may include mold problems, termites, foundation problems and a bad roof. The inspection can save you thousands in repairs later on. Additionally you may be able to negotiate a lower price if you know the home needs a new roof.
7. Once you have bid on your home and the offer is accepted you will go into escrow. The escrow holder will work to make sure that all the documents, money and other necessary information is together before you close. Escrow is set up to protect the buyer, the seller and the lender. It can take time to complete escrow, although the time really depends on circumstances around your purchase. Once everything is completed for escrow you will sign the closing papers. You may or may not sign your mortgage papers at escrow. If you do, you can request that the bank send a representative to help you fully understand your loan.
8. Once you have closed on your home, it is time to move in. You can paint, unpack and enjoy your new home. Be sure that you change your address with your bank, and other accounts. You can set up your utilities and cancel your old ones as well. This will save you time and money, because you will avoid late fees. Some companies will waive installation fees if you transfer your old account to your new address.

Get pre-qualified. Know what you can afford, but don't be afraid to put in low-ball offers in this type of market. Find the most reputable Realtor in the area you are interested in.

I've also heard of pre-qualification for buyers. It determines if you could afford the price. But aside from that you may also want to know if you get the right price or if it is overpriced.

You can go to my website at bolderrealestate and read the blog entitled home buying 101--The Cliff Notes. This may help. Michael

Buying a home is one of the biggest decisions that you will ever make. It is important to take this decision seriously. You need to take the time prepare yourself in every aspect in order to make your home a blessing, and not a negative experience.
Thanks !!!!

Make sure you consider future requirements while buying your home. If you have kids you may need more space in future; if you are buying home at the time of retirement, a bigger home is not what you need.

Another important factor is locality; try to find a home close to your work - this will save you few bucks on commuting.