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Smart Buyers-Anil,Bindhu & Pooja
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Why Buying a Home is a Good Idea
The Best Investment
As a fairly
general rule, homes appreciate about four or five percent a year.
Some years will be more, some less. The figure will vary from
neighborhood to neighborhood, and region to region
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The sellers
accepted your offer to purchase. The home is officially under contract
and you're counting down the days to closing. Don't worry. All will be
well if you keep your cool and follow a few important guidelines.
1. Don't Make
Another Major Purchase
You've just found out your credit is A+. So you've decided a new car
would look fantastic in the driveway of your new home. If you're paying
cash for the home go right ahead. But if you are depending on a
mortgage to move in you'd best wait until after closing.
- An increase in your
debt/income ratio reduces the amount of monthly income available
for your mortgage payment. The bank may decide you cannot afford
the home.
- Using cash for a
purchase can be a problem too, since banks consider cash reserves
when approving a loan.
If you must
make a major purchase before closing, talk to your loan officer before
you do it.
2. Don't Change
Jobs
Banks like to see a consistent job history.
They aren't usually as nervous if you change jobs within the same
field, but it's better to stay put until the keys to the house are in
your hand.
3. Don't Give an
Earnest Money Deposit Directly to a FSBO Seller
It should go into a trust account. Some FSBO sellers don't understand
that funds are a good faith deposit to be applied to your expenses at
closing. I've heard many stories about sellers who spent the buyer's
money prior to closing. When the transactions didn't take place for valid
reasons--such as financing or repair problems, the buyers had to fight
to retrieve their funds. Find an attorney who will hold the deposit for
you until closing day.
4.Don't Let Your
Emotions Take Over
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No Better Time
To Buy! Mortgage rates at
record lows. Contact John
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Type Rate% APR%
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30 yr. Fix
5.5 5.74
15 yr. Fix
4.63 5.147
**The
rates listed represent the lowest rates currently available for a
$100,000 loan based on a $125,000 purchase price for an
owner-occupied, single-family dwelling. These rates are only
available to qualified applicants who verify their income and assets
and maintain excellent credit
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There are many areas where that statement
applies, but one of the most important involves the home inspection.
- Be realistic. No home
is perfect, especially older homes. Don't let the seller's refusal
to do a small repair kill the deal on a home you truly love. It's
not at all unusual for new owners to take care of some things
themselves.
- On the other hand,
don't fall so much in love with the house that you'll buy it no
matter what needs to be done (unless you're absolutely sure you
can handle it emotionally and financially). Decide what type of
repairs you can realistically handle, then
stick with the decision.
5.
Don't Forget to Switch Utilities
That sounds simple, but you'd be surprised how many people forget to
apply for utility service at their new home. Call the companies
involved as soon as you have a contract. Find out how many days lead
time they need to turn on the new service, then
get back with them when you have a firm closing date.
6. Don't Forget
About Hazard Insurance
A no-brainer, right? But it's another often-forgotten task that buyers
scramble to take care of at the last minute. Your lender will require
an insurance binder for the new home at or prior to closing. Take care
of it right away.
7. Don't Become
Best Friends with the Seller
I'll get some flack on this one. It's great to
be friendly, but don't get into too many long discussions with the
sellers because personality conflicts often cloud judgments. I've had
selling clients refuse to make even small repairs because something
about the buyers turned them off.
And remember,
this is their home. You're no doubt excited about moving in, and if you
didn't like the house you wouldn't have offered to buy it. But you'll
make changes--everyone does. A casual statement about "ripping up
that ugly carpet" might be hurtful enough to keep the seller from
negotiating with you for needed repairs.Keep it to yourself.
8. Don't Panic if
the Appraisal Comes in Low
At least not at
first. There are some things you (and your agent) can do to correct the
problem. Discuss the various options with your Rea Estate Agent.
9. Don't Go It
Alone
If you're working with an agent it's the agent's duty to help you make
it to closing.
10. Don't Ignore
the Requirements
Know what is expected of you and take care of it. For instance, a
Certificate of Eligibility is required to move forward on a VA loan. That's
something you must handle yourself. If the lender asks you for
something, get it to them immediately
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