With mortgage rates incredibly low and a stabilizing market moving forward many renters that have been hanging out on the sidelines, are now saying, “Put me in Coach” when it comes to buying a home in 2012. If you’re like so many others that have been renting while waiting out the real estate market bust and are now considering if the time is right to buy a home, here are a few tips, or resolutions for 2012 that can help you mark this goal off your New Year’s Resolutions! By simply following a few rules and setting a few goals, you can insure long term success in your home buying search and not buyer’s remorse.
For starters, #1 Consult a Professional. This is the biggest purchase of your life, don’t make the mistake of not working with a Realtor that handles home sales transactions daily. There are so many facets of a real estate transaction that’s it’s not easy to maneuver your way around all that needs to be done properly. Such as, finding and working with a qualified mortgage consultant to handle the financial aspect of buying a home. Or setting up inspections and appraisals with licensed and certified professionals. Most people wouldn’t take their car to just anybody, make sure you find the perfect agent that relates well to your needs and that you trust.
#2 Consider Your Down Payment. The days of “no money down” home loans are long gone, in fact there are but a handful of these loans still available, i.e. Texas Veteran’s Land Board Assistance, certain City Home Buying grants. Most consumers are looking at a minimum of 3.5% down with a FHA loan. While conventional mortgage loans require 5-10% down, with some still requiring up to 20%. Don’t wait to create a savings plan that will work for your income and family. Be realistic and cut your budget where you know you will stay committed, like taking your lunch to work everyday and saving $35 a week on eating out.
#3 Know Your P’s & Q’s of Credit. Most lenders won’t even look your way with out a 640 FICO score or higher. And that’s specifically government loan programs like the FHA, VA and USDA. And Prime lenders require a minimum of 720 credit score. Get a copy of your credit report and make sure you dispute any inaccurate information. You can get your Equifax, Experian and TransUnion credit reports free of charge at AnnualCreditReport.com. Make sure you stay current on all credit obligations, because one 30 day late payment can drop your score 20 points or more.
#4 Get Organized. Your lender and Realtor are going to require a lot of paperwork from you in order to get you approved and ready to buy a home. Be prepared by having all your financials, employment records, assets, and even divorce papers ready as to speed up the process of getting approved. These days, banks want it all, so start getting it together now.
#5 Ask Questions. Don’t assume you already know all there is to know about buying a home. In fact, assume you know very little. Ask family, friends and co-workers about their experiences. Remember that the only stupid question is the one you didn’t ask.
Once you’ve decided to get in the real estate game and become a home owner, you’ll have lots to think about. But for now, these home buyer resolutions should get you started for the big show. For more information on buying a home or getting qualified for a home loan, contact us today.