Buying a Home 

Consider the pros and cons when choosing whether to rent or buy.  Buying a home may be a viable option and it’s a good idea to prepare for the process and requirements. 

Analyze Your Budget

Know how much you can afford and determine the qualities you value in a property before you start to  look.  Review your current income to determine your monthly budget. Remember to consider the amount for a down payment. Check with your lender to find out what they require for a down payment.

Determine before you look square footage or size, neighborhood and location, commute time to work or school, number of bedrooms and bathrooms, shopping, dining options, area crime reports and other ideal components.

Working with a real estate agent can help you with getting questions answered, working through the process in a timely manner and submitting an offer. Real estate agents represent you, not the seller, unless they are acting as a transaction broker or agent. As an option, you do not necessarily have to work with an agent. This option allows you to talk directly to the seller and avoid paying commission fees, but if you are not familiar with the process it may be in your best interest to use an agent to guide you through the process.

The Lending Process

Consider getting pre-qualified through your lender for your home loan. Prequalification shows the seller you are serious about buying and the seller may be more willing to accept your offer over others.

Finding a lender may require some research to find the best interest rate and terms that are right for you. Your loan officer can often provide options to for you to consider.

The lender will ask for personal information to conduct a credit background check. Your lender will typically request a photocopy of your current driver’s license, social security card, residence history, your current landlord’s name, your current address, and your employment history which may include pay stubs or W2s and 1040s, or a profit and loss statement if you are self-employed. Your lender will most likely review your checking accounts, savings accounts, documentation on stocks, mutual funds, 401K and retirement accounts, student loans, bankruptcy and discharge papers and other financial account information. This allows your lender to assess the loan amount you can afford.

Remember there may be additional expenses such as utilities and homeowner association fees, which are usually in addition to the mortgage payment. Buying a home typically requires a down payment. Home maintenance will be your responsibility, too.  Consider market fluctuations which can equate to an increase or decrease in the value of your home. On the upside, purchasing a home provides an opportunity to build equity and take advantage of tax breaks and deductions.

The Closing 

The closing is the signing the final paperwork necessary for ownership.  You may need to set up a wire transfer of funds for a down payment or other funds required for the closing. Closing typically requires about an hour and a half for the entire process. At the closing you may be required to bring a government photo ID, driver’s license or passport, proof of homeowner’s insurance. When signing the paperwork, be sure to check for correct personal information, such as address, social security number, loan information such as the final cost, down payment and interest rate. Information on the new home should also be verified such as your name, the address, square footage, payments, due dates and late fees. After the closing, make sure to keep a copy of the closing papers in a safe place, as you may need to reference them in the future.

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