2. Interview 2-3 Real Estate agents and pick one that you match with and be loyal to that agent.
3. Make sure your agent represents buyers on a frequent basis.
4. Have your agent walk you through the current market explaining the pros and cons of short sales, foreclosures and standard sale.
5. Be prepared to make offers quickly when it is a property that you can call home.
6. Let your agent be your guide.
Get motivated by giving the first step. Any step on the right direction will improve your chances of getting your dream home and keep it.
Be sure to read till the end, where I give tips that can pay for your down-payment up to 3% of the selling price. I will start with a simple financial fact. If your credit score is not good you may have to pay a premium that you will carry for a long time or even be denied a loan.
Mortgage total $200,000.00 - Interest rate /(APR) 5% / 5.16% 30 years Monthly payment $1,073.64
Challenged credit :
Mortgage total $157,400.00 - Interest rate /(APR) 7.25% / 7.54% 30 Years Monthly payment $1,073.75
The credit side:
1) For people with no/thin credit history, get a credit card and auto-pay your monthly expenses like utility bills, gym, and insurance. Credit cards donâ€™t incur fees like ATM so you will also save by paying your groceries, gas and other small expenses with your credit card. Just pay it off before due date so you donâ€™t pay interest. You can be sure that you wonâ€™t ever be late on those payments, and if you canâ€™t pay the credit card off 1 month it wonâ€™t harm your credit.
Ironically, having in excess of 15 accounts is positive to your credit, but donâ€™t apply for too many too soon. Wait 6 months between applications. What the lenders like to see is that you have credit, and can use it responsibly.
2) For people with bad credit history: It is especially important that you clear all your collections/wrong information before you apply for a loan. You can get your free credit report (the same that the lenders will see) at http://www.annualcreditreport.com . It will also tell you how long each account will stay in your record, so you can wait for a better opportunity in the future.
3) The above tips also apply to potential cosigners and co-borrowers.
4) Start saving regularly on a savings account. Lenders may see as positive that you have regularity in saving
The income side:
1) There is no magic (any more) that will allow a mortgage underwriter approve your loan with a higher debt-to-income ratio. Meaning that your loan will depend on your income minus your other debts.
2) Turn stated income into legally accepted income by declaring them on your income tax. Your â€œother incomeâ€ becomes real income if they show up on 2 years tax returns.
3) Include the co-borrower/co-signer income on your planning.
The down-payment side:
1) Sell some of your assets. Selling old cars and making a garage sale can get you started with your savings account.
2) The tip to start saving on a savings account also creates capital that will help pay for the down-payment and closing costs. If your estimated mortgage payment is $1,500 and you pay $1,000 in rent, the savings of $500.00 every month will prepare you for your knew responsibility, and show to your lender that you are ready.
3) The down-payment can tip the scale toward loan approval on very low fico scores, and get you on the sweet spot of 20% equity that does not require mortgage insurance, which increases the cost of the loan.
4) Apply for down-payment assistance with your Loan Officer. CALHFA can pay for up to 3% of your down-payment/closing costs if you and your property qualify. Check the link bellow for more info. It is the Loan Officerâ€™s job to get you into the best programs available. Call me and request a visit to help you plan for you new home.
Loan Officer license NMLS 829964
Realtor license DRE 01862345
Select a professional real estate agent; we are here on this site many good agents with a lot of fantastic comments and recommendations. Have a clear list for your Realtor what is important to you. (if you have kids perhaps schools, or near your work , bedroom count, sqft. Etcâ€¦.) Also, be flexible with your â€œwant listâ€, keep in mind this is your first home , a stepping stone to your next ideal home. Once you find a home have your Realtor evaluate a good realistic purchase price to offer, based on recent sales in the area.
Once in escrow, you will need to have home inspections, if itâ€™s a condo; obtain all the CC & Râ€™s and by â€“laws, your agent will assist with all the paperwork. Start calling you around to obtain insurance on the property.
Remember, keep asking questions, we are not mind readers so do not hesitate to ask if something is not clear or you are unsure. We will be happy to explain to you.
GOOD LUCK and Congratulations~
Call me ; I would be happy to help you,
Lesley Harris Realtor
The first step would be to get all your finances in order and then get preapproved. There are several programs available to assist first time buyers that may need help with a down payment. The ones the at I recommend are http://www.homepath.com and http://www.calhfa.ca.gov/. If you are looking for a loan officer for a standard FHA or conventional I recommend all my clients to Doug Jones at Big Valley Mortgage. You can reach him at 916-770-0960. Good luck!!!
You need to meet with you lender and become pre-approved...not qualified, but approved! Your lender will ask for a number of documents. This will be a mandatory process at some point, so why not get the leg work done before you find the home of your dreams? Then, when you do find your new home, you'll be all set. Yes, you may need to update a portion of the data, but you'll be ahead of the game.
My experience is that when a Buyer enters a home, they know almost instantly if it is the home they are looking to purchase. Even if something is important to them, like a fireplace or a pool, they will often over-look this 'short-coming' because they like the home so much.
The key... be ready!
2. Research the market in areas that you may want to live. Find a knowledgeable Realtor, and go see some properties in your price range. Make sure that your Realtor is experienced with short sales and bank owned properties, as these are the bulk of the properties on the market today.
3. Be willing to compromise. It is great to have a wish list, but even buyers looking at multi-million dollar homes are not always able to find all of the features they want in one package.
4. Be patient. Buying a home can be a long process, particularly if you are dealing with a short sale. But the payoff is really worth it both financially and in terms of quality of life.
Good luck to you.
Loan Officer and Realtor
ERA Buy America Real Estate Services
Getting an agent who has been there themselves will help a little. When I bought my first home I was single, living in an apartment with two other girls and didn't want to wait any longer to find a home. I picked the first agent I met, and now as an agent, I recommend making sure you like them, and don't feel bad if you don't and go to another agent. You are going to be spending a lot of time with them even if you buy the very first house you see.
Like many of the answers below, getting pre-approved is a good thing to do. Any agent can help you find a broker if you don't have one, or many local banks have first time buyer programs. Knowing your budget will help you make a smarter decision buying a home.
The loan pre-approval should give you a good look at your overall financial condition so you can make some other smart decisions. For instance, don't buy too much house and add an hour each day to your commute. Your expenses will go up, and you fun meter goes down quickly.
So my three tips are:
Find an agent you like
Get Pre-Approved and know your finances
Buy close to work, don't make yourself miserable for a little bigger house.
Any other questions, drop me a note or stop by the office.
Kelly Bourquin - Agent
The best leading factor for buyers is being able to take advantage of Downpayment Assistance with lower loan qualifications. A loan program that I have been using quite frequently allows the borrower to come in with just 0.5% down and have the credit score as low as 580 or a no score.
You can read more about this on my blog at: http://excellenceduo.com/2011/california-homebuyer-down-paym and it even has a video to help explain to buyers.
Excellence Real Estate
You can also see all of our Home Buyer related info on our blog at: http://excellenceduo.com/category/home-buyer/
Your highly experienced agent can help you find the right lenders, inspectors, etc. They will know the market, how to navigate through distressed inventory, and how to help you find the right home.