The Acacia Federal Blog

The Ins & Outs of Buying a House

Mortgage rates continue to remain near historic lows, and for buyers who qualify for a home loan, this time period offers a great opportunity. Here are some considerations to keep in mind as you start your home buying process.

Make a Checklist

Before you start searching, write down what you’re looking for. Are you looking for a
house or a condominium? Is there a specific area that’s appealing? Is there a layout you prefer? Consider these questions and make a list of the things you want in a new home. Include everything from location to interior/exterior features, and divide the list into two sections: negotiable and non-negotiable. Having this list will help you narrow down your property search, and help guide your decision-making process.

Get Your Finances in Order

Start by requesting a free credit report from one of the three credit bureaus (Equifax, Experian, or Transunion). Doing your homework by looking into your credit report will give you a chance to clean it up and dispute any errors. If you have monthly debt obligations, pay down those balances and get yourself moving in the right direction toward a higher credit score. Then, examine home financing options and decide how much you can afford for a down payment. It’s important to remember that the larger your down payment, the lower your monthly mortgage payment. Take advantage of an easy-to-use online mortgage calculator to determine down payment and monthly payment information.

Hire a Realtor

Ask for recommendations from family, friends and acquaintances who have recently
sold or bought a house. Create a list from these suggestions, and arrange to meet with the realtors to determine who you are comfortable working with. A competent realtor should have first-hand knowledge and an understanding of the local housing market.

Save Time

Before taking time to visit a property in person, see if there’s a virtual tour online.
If not, ask your realtor to do a preliminary walk-through. Don’t waste time looking at homes you know you can’t afford. If you know you don’t have the skill or the funds to repair a fixer-upper, don’t even consider those.

Make An Offer & Negotiate

While buying a home isn’t quite the same as buying a car, there is a similar process
for negotiation.

• Don’t offer full price unless it’s the best deal you’ve ever seen, or you’re facing competitive offers from other buyers.
• If the house needs work, take into consideration the cost of renovations. If not already reflected in the asking price, deduct the cost of repairs before making an offer.
• Don’t be discouraged by counter offers. The fact that the seller is engaging you means they’re taking you seriously. Don’t automatically accept their counter offer; determine how much more you’re comfortable paying, and consider submitting your own counter offer.

Home Inspection

Before you close on your house, arrange for a home inspection. Examine what is covered by a home inspection, and print out a list for reference. Hire an accredited home inspector, and accompany him as he inspects your potential new home. Keep
your list handy to be sure his inspection covers all the pertinent areas. Make sure you’ve been made aware of all material facts. Prior to closing, always do a final walk-through to inspect the property and ensure it’s in the same condition as when you agreed to purchase it.

Closing

After you’ve made the decision to buy, be aware that there are a few things that need
to be in place before you can close on your new home. Your realtor and your lender should be able to help you with these requests so you are prepared.

• A title search is required by mortgage lenders to ensure that the buyers have clear title to the home and it doesn’t have any liens placed against it.
• Decide how you want to hold title to the property (the legal name(s) and type of relationship between owners). Various options have different estate planning and tax implications, so consider consulting an accountant or attorney if you are unsure.
• When closing on your home, you’ll need to bring a paid receipt for homeowner’s insurance, which covers your house in the event of fire, damage, etc.

For additional tips to help you prepare for homeownership, visit our official web site.