The Freeman/Davis Team at Coldwell Banker/HPW is proud of our long-time emphasis on assisting first time buyers with this important step in their lives. If you or someone you know is beginning to think about buying a home, we have important information on the selection process, resale considerations when buying, the $8,000 tax credit (which you may be able to use as a portion of your down payment) and the entire homebuying process. Visit www.HomeSearchRALEIGH.com, www.FreemanDavisHomeTeam.com and www.WakeCountyRealEstate.com for information essential to know for such an important purchase. Then email or call us at 919-649-6638 for a personal consultation.
As a first time buyer, your biggest challenge is to balance livability and profitability in a way that makes sense for you and your family. Remember, you are buying a home first and an investment second. Of course, there’s no foolproof formula for buyer success, but there are steps you can take to stack the odds in your favor:
Tip 1: Leverage free and low-cost resources
There’s an abundance of free and low-cost resources for home buyers on the Web. A Web search can turn up helpful articles, buyer guides, online tools and purchase/ refinance calculators. Keep an eye out for helpful tools like step-by-step guides and checklists to help organize your search. Some Web sites now offer online tools to help you estimate home prices and search for undervalued properties.
Tip 2: Check out the new models
Real estate’s old guard seems to be under assault at every turn today as traditional broker’s battle competition from discount and Web-based brokers. Today, buyers have more options than ever before. You can use a full-service broker, discount broker. To make buying more affordable, consider the home buyer rebate programs that are becoming more popular. Rebates can help offset closing costs, which are a real obstacle for many first-time buyers. Be aware that some states currently ban real estate rebates all together, and others limit rebates to credits applied to closing costs.
Tip 3: Lock in a realistic budget
To save time and trouble, first time buyers should have a realistic budget in mind before they shop for homes. One way to determine how much house you can afford is to get “pre-approved” by a lender. Pre-approval means you know exactly how much of a loan you’ll qualify for, so you can limit your search to homes in the right price range. Pre-approval also boosts your credibility and negotiation position with sellers.
Tip 4: Buying — personal decision, business transaction
The Department of Housing and Urban Development (HUD) advises home buyers to create a wish list to help focus priorities. That way, you’ll remember that a spectacular foyer is nice-to-have, but safety and services are essential. Having clear goals will help keep you from getting carried away with emotional factors. Sellers who love their homes tend to ask too much, and buyers who fall in love can end up overpaying. With a little research, you can get can get an objective estimate of property value to make sure the seller has set a fair asking price. There are tools and resources on the Web to help you better understand home valuations.
Tip 5: Don’t let closing costs surprise you
Once you understand the buying process, you should understand and budget for transaction costs. In addition to your down payment, buyers pay most of the closing costs when purchasing a home, including things like inspection fees, title insurance, taxes and more. Closing fees can add up to 5-7 percent of purchase price, and must be paid before you get the keys. Your lender can provide what’s called a “good faith” estimate of your closing costs. Most closing costs are not negotiable but some are. When you’re comparing lenders, don’t be shy…ask which fees are negotiable, then ask if any discounts are available. Finally, be cautious about “no-cost” closing promotions because the lender may be simply passing on the costs in the form of a higher interest rate.
Tip 6: Build a support team
Buying a home is a big investment and a big decision, but you don’t have to go it alone. Remember, at each step of the way, there are people and resources to help you. Use the Internet and ask friends for referrals. Don’t be afraid to pick up the phone and call real estate professionals, mortgage providers, title companies and insurers to ask questions. These professionals should be good resources to help you learn more about home buying, because they want to earn your business. If they are not helpful, then you have also learned something important…that they don’t deserve your business.
Tip 7: Clean up your credit
Low credit ratings mean that buyers won’t qualify for the best available interest rates and fees, which could mean considerable extra expense each month for the life of the loan. First-time buyers should check their credit scores and fix any problems before applying for financing.
Tip 8: Begin with the end in mind
Author Stephen Covey’s advice for effective living also applies to effective home buying. Resale may not your primary consideration, but it’s an important factor. Can you buy in an up-and-coming neighborhood or region? How is the “commutability” from your new home to local employers? How good are the local schools? A few queries to your favorite search engine will turn up free or inexpensive school rating services. Also be on the lookout for outdated features when you buy. If the those small closets and harvest gold appliances seem out of step now, you can bet that they won’t look any better to prospective buyers in a few years.
Tip 9: Don’t move without The Freeman/Davis Team
We’re here to help YOU make GOOD DECISIONS!
