THE First Time Homebuyer Talk
Buying your first house is one of the most exciting times in your life! With many of my first time buyers, the prospect of their very first home can also be a bit unnerving. But don’t let those jitters get in the way of YOU becoming a Home Owner. Before I give you my top 5 tips on how to get you the keys to your dream house, let’s look at the reasons why buying a home VS. renting is such a great benefit.
- You will definitely HAVE tax write offs. Why is this important, well a tax deduction LOWERS your taxable income. By lowering your income (through what you spend on the house); you’ll actually be only taxed on that portion remaining. So, you’ll save money.
- You will never EVER again, be told what you can or cannot do to this house. The sky’s the limit for your creativity.
- You will NEVER pay another Pet deposit. Rover or Princess the kitty is living in your home. If you want to charge them Great. But you will never have a landlord and their crazy fees again to worry about.
Now that we got some of the Yays! out of the way, here are the top 7 ways to get you to see the results above:
1. Don’t Assume you won’t get approved for a mortgage
A mortgage review is based on a few factors. Those include how much monthly debt you carry, your credit score (don’t assume what that number is), a downpayment and your current income. There are options for buying a home with a loan courtesy of FHA, and other loan tools such as VA loans, low income loans that may be available to you. Don’t shut that door until you’ve entered the building. Like I tell everyone, being a Realtor is MY profession likewise being a Loan Officer is a profession. True professionals will thoroughly work hard to find all the solutions possible to get you into the home. GO TO A LENDER FIRST AND TALK TO A REALTOR FOR BUYING GUIDANCE!
2. Never Interview only one lender
Fees and rates will vary as well as Loan products. Getting more than one quote enables you to compare. Having my background in Credit and Finance has helped all my clients to navigate through the confusing world of Loan products– So call me and we’ll tag team this!
3. Get Pre-Approved early on
So picture this: You and I find the perfect home! It’s so perfect that we now have multiple people wanting this same home. Now, you know this is it and you’re willing to do what it takes to have the Seller see you as their next home owner. BUT hey, you can’t put in an offer in without showing the owner you can buy the home. How do you show it? You have a Prequalfication Letter. Oh you don’t, then the other buyers will have a shot at this home before you get the paperwork through. See my point? Getting pre-approved first will allow us to send in your offer IMMEDIATELY with the necessary document to say “Hey I want your house and can afford to pay you”.
4. Think about maximizing your qualified limit
The number your lender gives you as the MOST they can lend you is what only the mortgage will be. The number translates to a monthly figure. That monthly figure is just one in a series of things you’ll be paying for. So do this, create a budget. List out the possible mortgage amount (at the highest end) then add in the other expenses (such as utilities, property taxes, your own known expenses) and see if you can live with paying that much out of pocket a month.
If not, then you’ll need to lower your maximum qualified amount. If YOU DO, definitely let’s talk about where you can find a home for that price. It pays to work it upfront.
5. Letting your emotions control your decisions
One thing will be for sure, buying a home can be emotional. While you should have those feelings of happiness (for finding the perfect home), anxiety (with getting all the paperwork requested by the Lender), concern (due the unknown such as Inspection and appraisal); know this: I am at your side through it all guiding and managing those folks that are working hard to get you in that house!
Being emotional is really good.
6. Understand the contract- the entire contract
One thing that I find extremely important to do with my clients is to sit down and explain the buying contract process from start to finish. Why? Because, in the Arizona contract, the Buyer and Seller each have responsible key parts to work through on the contract. These parts are date sensitive and activity based. If things are “missed” or skipped then the Buyer or Seller can lose their right to address the item. That’s why my role is to make sure that we keep the process moving and addressing everything in the right time. I want you to have your dream come true!
7. Allowing your credit score to change before the close
Don’t, I repeat, don’t do anything drastic while you’re being reviewed for your loan (in fact DON’T do anything until I give you the keys). Any loan is subject to ensuring that you can afford the monthly payment from an OBJECTIVE source – your lender’s underwriting team. If you have any any major changes, you could theoretically unravel the work that was done based on your original information. That new scenario may tip the scales out of your favor.
- Buying anything and I mean anything new on a credit line
- Adding a new bill to your current monthly payments
- If possible, try not to switch jobs. If you have to, please let us know as soon as possible. This may turn out to be a non issue but it will be checked and you definitely don’t want a surprise answer.
Your Dream is my dream for you!!