Buying your dream home is as easy as A-B-C. Follow the simple steps below. It may take months or even years to be prepared for your purchase; don’t get discouraged, just keep working on it every day. Once you move into your new home, it will be worth all the planning and preparation! So just keep focused on your goal and be persistent.
A. PREPARE FOR PURCHASE:
1. Write down your family’s financial goals (short term and long term). For example: Buy a house within one year; Be debt-free within 10 years.
2. Prepare a monthly family budget. Your monthly debts (including car payments, child support, and credit card payments) should be 10 – 15% of your gross monthly income. Contact your financial planner for assistance.
3. Upgrade your credit report. Make all credit payments on time for at least 6 months. Make arrangements to clear up any unresolved items such as charge-offs or defaulted student loans.
4. Eliminate consumer debt. Don’t purchase an automobile or any other major purchase on credit.
B. PRIOR TO PURCHASE TIME:
1. Complete the loan application form (1003) and turn it in to your lender, with the credit check fee (usually about $25 per person).
2. Follow through with loan agent to receive a letter of pre-qualification from your lender.
3. Contact your Realtor?, to search for homes in your pre-qualified price range.
4. View homes with your Realtor?, and find the best homes for your family.
5. Your Realtor? will make an offer to purchase a home. Your offer will be accompanied by your earnest money deposit (usually $1,000 or more).
Negotiating a sales price
Negotiating a sale price starts when you make an offer on the house. Depending upon the market, this is usually lower than the seller’s asking price. The seller can accept, reject, or ignore your initial offer. He can also make a counter offer, which is a concession to lower the price to meet your offer part-way.
Remember there are two parts to an offer: the price and the terms. So if you can’t agree on the price, perhaps you can offer terms which help both parties come to an agreement. There’s an old saying in real estate negotiations, “You name the price, and I’ll name the terms,” meaning that both parts of the offer are equally important.
After the first counter-offer, the buyer and seller may go through a series of counter-offers to arrive at a sale price (if agreeing at all). This means the spread, or gap, between listing price and initial offer gets narrower. Armed with your own appraisal and inspection report, you can make an informed offer and more effectively negotiate a final sale price.
C. YOUR PURCHASE:
1. If your offer is accepted, the title company will use your deposit to open an escrow.
2. Your Realtor? will walk you through all the escrow steps, including reports, inspections, disclosures, and lender contact.
3. In about 30 to 45 days, you will have to deposit loan closing fees and sign loan documents, and your escrow should close.
4. Remember to have your attorney review your loan documents and help explain them to you before signing. If you can’t afford attorney fees, enroll in a pre-paid legal membership plan for a low cost lawyer service.
Call the movers! You are now the proud owner of your own home!
By: R.P. Brown
Tags: Asking Price, Car Payments, Charge Offs, Consumer Debt, Credit Card Payments, Credit Check Fee, Credit Payments, Defaulted Student Loans, Earnest Money Deposit, Family Budget, Financial Goals, Financial Planner, First Time Home, First Time Home Buyers, Form 1003, Loan Agent, Loan Application, Pre Qualification, Simple Steps, Time Home Buyers