Real Estate Buying Tips
Before You Look
Before you start looking for your new home ask yourself these questions:

Where do you want to live?
Do you need to be close to schools, or work?
What does your new house need?
How many bedrooms and bathrooms do you want?
How much storage and garage space do you need?
What kind of house would you like?
Is there a particular style you prefer?
How many levels do you want?
Do you want a yard?
What can you afford?
Have you consulted a Realtor or mortgage lender to determine how much you qualify for?

Getting Organized:
Look for real estate MLS (multiple listing service) listings on our web site. This will give you a good idea of homes that are on the market and what they cost.
Look for real estate advertisements in the newspaper and hometown magazines.This will give you a good idea of homes that are on the market and what they cost.
Visit open houses on weekends. Looking at a different homes might give you some ideas for things you'd like in a house but never considered.
Start saving money - you'll need to have cash on hand for a down payment and closing costs.
Avoid any additional debt. Pay down credit cards, and don't make any major purchases on credit.
Find a Realtor. A Realtor will be able to help you determine how much you can afford. They will also be able to provide you with helpful information on homes that might interest you. When you are ready to make an offer on a home, your Realtor will assist you in completing all the necessary forms.

How much house can you afford?
A good way to determine the amount of mortgage that you will qualify for is to take your gross monthly income. Which is before taxes and other deductions. Then multiply it by .28. This is just over one quarter (1/4) of your gross monthly income.

Mortgage companies use qualifying ratios to determine how much money they will lend you. Most mortgage companies use either a 28/36 ratio or a 25/33 ratio. The first number in each pair represents the percentage of your gross income that the lender would consider as an acceptable mortgage payment. It works like this, if your gross monthly income is $2,500. Then $2,500 * .28 equals $700 per month.

The second number represents your gross monthly income and all of your incurred debt payments, not just the mortgage. If you make $2,500 per month, and also have a $225 a month car payment, $2,500 * 36% is $900, minus the $225 car payment equals $675.

The numbers in this example are nearly the same. If you have incurred more debt, you would qualify for less. This is why it is so important to pay down credit cards, and buy the new car later.

Use our Calculator to find out an approximate amount that you would be able to afford and qualify for when applying for a home mortgage.

What makes working with a Realtor so important?
It is a good idea to work with a Realtor for several reasons:

They will help you analyze your financial situation, so you can determine what you can afford.
They know the in’s and out’s of buying a home and will be able to explain thing to you.
They have easy access to all the properties listed for sale by Realtors in your area.
They can show you homes in the area that interest you.
They can help you with you all the necessary paperwork when you are ready to make an offer.
They will arrange the closing and be there to make sure that you are confident and every thing runs smoothly.

Working with a Realtor
Looking for the home of your dreams usually takes time, and having a Realtor to assist you makes this process much easier and more efficient.
Because you will spend a fair amount of time with your Realtor, choose someone that you feel will be able to assist you with all of your needs. Make sure that you are comfortable with the person that you choose.

Do you feel that this is the right kind of person to represent you as the buyer?
Do you feel comfortable spending time with them?
Do you feel that they are responsive to your specific needs?
Do they ask questions?
Do they explain things clearly?
Do they return your calls?
Are they willing to work with your busy schedule?
Do you think that they are capable of helping you with your financial needs?
Can they help you determine how much you can afford?
Do they suggest financing methods?

These are just a few questions you should ask yourself. If you can answer “YES” to these questions, you have found the right Realtor for you.
If you find yourself answering "no", you should keep looking until you find a Realtor you feel comfortable with. Above all consider your needs and concerns.

Get Financing First
The home financing market is very competitive and buyers who arrange their financing first have a distinct advantage. Talk to several reputable lenders. Get pre-approved for a loan unlike pre-qualification, which is a simple quick estimate of your borrowing potential, a pre-approval is a formal approval of a specific loan amount. And you will receive a good faith estimate of your closing expenses. By initiating the loan process early, you will be in better shape to search and purchase.

Getting in shape to purchase your home
Consider the following:

Pre-approval
Have the necessary funds in your checking account to write an initial ernest money check.
Have the remaining money for your down payment easily accessible.
If you are receiving a gift letter for a portion of your down payment, be sure to have the money transferred into your savings.
Keep all credit accounts current.
Have a credit report run so that you can see what might be on the report and clear up any credit problems.
Be aware of the dates you can move.
Do you have a current lease?
Can you sublet your current residence?
How important is it to remain in your current residence until the lease expires?
Can you be flexible on dates?

Questions for your lender
Are both fixed-rate and adjustable mortgage loans available?
What is the interest rate?
How long can I lock in the current interest rate?
What are the other fees a lender may charge me in conjunction with my loan?
Will I be charged for making extra principal payments?
If I sell my home, will the new buyer be able to assume my mortgage at the same interest rate?

Closing on your new home
You are finally in the home stretch. Closing, also known as settlement or escrow, is the last step, the official transfer of the property form the seller to the buyer. Once it is completed, you will be the proud owner of your new home. In the meantime, here is what you need to know to prepare for your closing. If you have additional questions, we will be happy to help you!

What to bring to closing
A certified check for the amount specified in your most recent good faith estimate from your lender or loan officer.
Your personal checkbook to cover any extra charges, if necessary.
Your new homeowner's insurance binder with proof of one year's payment.
A photo ID.
A list of your addresses for the past five years.

What to expect
The typical closing will last about an hour or so. It usually will take the first half hour just for the buyers to read and sign the mortgage, HUD One statement, and the note. The buyers will go in first and then the sellers will follow to sign their needed paperwork.

After the parties involved have done their paperwork, then the Realtors and closing agent will allow the sellers and buyers to get together to go over any questions that the buyers may have about the property. You will then receive all necessary keys and garage door openers!