how to buy your First Home?
There are many market predictions, however if you want to buy your first home—there is no wrong time. The motivation to buy is not determined by regional market conditions or by location.
Industry opinions and investor speculation can not predict when a particular individual will be ready to buy. For the great majority of folks, the most compelling reasons to buy a home are based on individual circumstances and personal needs.
When is the Right Time to buy your First Home?
• Family needs and desires for children/parents/in-laws/couples
• Convenience to home, work, school, social activities
• Sense of achievement or fulfillment
• Freedom and independence
Even though there are many changes in the market, both up and down—people still need and want to buy homes. This desire to buy a home is deeply rooted in the fabric of our consciousness. The value of homeownership gives far more satisfaction than ROI calculators can quantify.
Today, there are many different loan programs with flexible terms to fit all buyers. There are city and county down-payment assistance programs to assist in buying a home.
For future buyers with blemished credit, there are debt reduction and counseling programs to help gain a fresh start.
How do you make the leap to become a homeowner? First, determine that you want to buy a home. Get your finances in order. Determine your financial situation and check your credit to determine where you fall as a borrower.
Look at all of your available assets for your down payment and examine all of the finance options available to you.
If you have some credit blemishes, take the time to make timely payments to your creditors to present the best financial picture.
Make sure that you have a track record of stability in your employment history. Postpone any major purchases. Your actual home purchase may still be 12-18 months down the road, but you can still prepare for it now.
Get pre-approved for your mortgage. Once you’ve cleared the financial hurdles, talk to your lender or broker to find out how much you can afford to borrow along with the expected out-of-pocket costs you will need to incur for the closing.
This will include the required down payment along with funds for closing costs. If you are buying in a seller’s market, you may want to search for homes below your approved price range, so that you can have the most room for negotiation.
Find a credible licensed real estate agent. Look for an agent that can work with you based on YOUR needs and your schedule.
Check references of previous clients. You may not know exactly what you want in terms of a new home, and your agent should work with you to determine your needs and help you find a property that meets your immediate and future needs.
Check with family and friends for successful agent referrals. Ask them how satisfied they were with his/her services and if they would use them again.
Become an informed and practical buyer. Once you determine where you would like to live, determine what factors are most important for your family.
Calculate your new commute time and research school information for your children. Make sure to evaluate the surrounding factors that are most important to you, along with factors that are least important.
Find a home that works for you. Envision yourself (along with your family living in the home). What are the key points of consideration for your home?
If you spend a lot of time in the kitchen, then you want to make sure that the kitchen can accommodate your habits. If you will be working from home,
make sure that your home office setup will work. Make sure that all of your telecommunications and electrical needs can be met.
Make the offer. Once you have located a property that meets your needs, make an offer based on the listing price,
along with comparables information and market considerations. Your agent can work with you to determine the best price, along with any contingencies for the sale.
It is good to get a home inspection, so that you can know what the potential pitfalls and future maintenance needs may be.
In a seller’s market, you may find yourself bidding with several other buyers for a single piece of property. Work with your agent to determine what is customary in your area. This is when negotiation skills really come in handy!
Once your offer has been accepted, you will enter an escrow period, where all of the title research will be handled, funding requirements met; tax and title transfer paperwork managed.
Prior to the close of escrow, you will sign all of your finance paperwork, and pay your remaining deposit and closing fees.
After funding is complete, the title company will record the new purchase deed with the County Recorder’s office, and you will officially “close”.
Congratulations! It’s time to move. Make sure to connect your new utilities along with mail forwarding. The purchase of a home can be a lifelong achievement, but one that is truly a worthy accomplishment.
Are You Ready To Buy Your First Property?
Buying your first home is very exciting. When you are ready to buy your first property, there are many details to sort through and plenty of important issues to address.
After saving and planning for a period of time, you need to be certain you are making the right decisions when you buy your first property.
When you are ready to buy real estate, there are many sources of information regarding listings. The first source many people go to is a real estate agency.
A real estate agency has listings of all sorts of real estate including parcels of land. You might choose to buy a piece of land and build a house instead of buying a resale property.
If this is something you are thinking about, before you go ahead and buy a building lot, you may want to consider visiting a lending institution to discuss a pre-approved mortgage for your new home.
This would insure the funds are in place after you buy your land. There’ll be no hesitations in starting your building project.
If you decide to buy a piece of resale property, be sure to have the property appraised and inspected. If you’re applying for a mortgage, the lender will request an appraisal before you buy the property.
A home inspection regarding details such as electrical, plumbing and necessary repairs is not likely to be required by the lenders. It would be in your best interest however to have these matters assessed before you actually buy the house.
You must also decide where you’d like to live before you buy your first home. There are plenty of options regarding where to buy. It’s totally up to you the buyer, where you’d be comfortable living. Many people prefer city life because of the convenience it offers.
Others would rather settle in the quietness of the country or be enveloped in the beauty of the waterfront. This is a big decision to make before you buy your first home.
You may be living there for awhile. This brings up another issue. You might want to buy in an area that has a good resale market.
When you buy your first home you aren’t thinking about reselling but, one never knows when they might be compelled to sell or choose to sell.
When you are ready to buy your first house, it is wise to sit down and figure out what you can actually afford. It is imperative to take into account monthly expenses besides your mortgage and maintenance expense.
Opting to buy or build a huge spacious house without regarding your overall expenses may create financial difficulties in the future.
It is tempting to buy the home of your dreams but it isn’t always practical. To avoid unnecessary stress, before you actually buy your first home you should definitely discuss your finances with your personal banker or the lending institution to determine exactly what you can afford.
Before you buy your first property, take time to think it through. Rushing out and buying the first house that catches your eye is very rarely the best idea.
Looking To Buy HUD Homes?
Buy HUD homes are sometimes the cheapest option available for a common man to own a house. The fact that teachers and police officers could buy HUD homes at
50% off the market value attracts more potential buyers.
Before starting off hunting around to buy HUD homes, let us see what actually a HUD home is?
HUD homes are those dwellings that have been acquired by the U.S. Department of Housing and Urban Development.
When a home owner fails to meet the payments of a HUD insured mortgage, it results in the home getting foreclosed by the mortgage lender.
He then transfers the ownership of the house to HUD and collects the money owed to it. HUD homes are then put for sale at the current market rate with the aim of selling it off quickly and recovering the money.
It in fact offers a cheap option for those looking to buy HUD homes.
Buy HUD homes options vary from family residences and townhouses, condominiums and other types of residential properties. It is a cheapest and later profitable option to buy HUD homes for common man as well as potential investors.
While a common man sees buy HUD homes as a way to earn a house for him and family, an investor taps the economic potential in re-selling it at a higher price to some body ready to buy HUD homes.
Other home buyers are motivated in buy HUD homes at below market value because it allows them to acquire a larger home than they could normally afford to purchase.
In fact, any one can buy HUD homes. But in order to buy HUD homes, he/she should have a pre-approved mortgage or is in possession of a verifiable amount of cash for purchase. But the price ranges are such that any low or moderately salaried American can buy HUD homes.
And on the race for buy HUD homes, an owner-occupant has preference over other buyers if he/she is deciding to buy HUD homes as his/her primary residence. But this privilege is valid only for a certain period, beyond which the home will be available to other qualified persons looking for buy HUD homes.
In order to buy HUD homes, one can strike the deal only through real estate agents approved by the U.S. Department of Housing and Urban Development.
Approved agents can submit bids during any day of a week, from which the highest net bid is chosen. If there is no acceptable bid to buy HUD homes, the home is put to new bidding until sold.
On the acceptance of a bid to buy HUD homes, the agent will be notified within 48 hours. The settlement is usually completed within one to two months, during which time financing is arranged and the sale is closed.
If you do not close by the settlement date, your earnest money deposit is forfeited else you have to pay for an extension of the sales contract.
For those looking to buy HUD homes, since HUD homes are sold in a ‘as-is’ basis, conducting a professional home inspection before submitting a bid is recommended.
The customers who buy HUD homes need to pay for any repairs/maintenance – those expenses would not be paid by HUD. After you buy HUD homes, the selling commission will be paid by HUD only if such a condition is there in your offer.
To buy HUD homes, the U.S. Department of Housing and Urban Development does not provide home loans directly. One can make use of the several insurance mortgage programs available to buy HUD homes.
Buy Your First House Before You Can Afford It
Purchasing a home is most likely the biggest and often the best investment that you will ever make. Why not make that investment now?
If you are saving up with the goal of getting your dream home within the next two to five years, the following ideas could help you buy your house sooner than you planned.
* Buy from a motivated seller. A motivated seller is someone who has a house he or she wants to get rid of quickly.
It could be that the owner was unable to sell the house on his or her own or that, even though the house was listed through a real estate agent,
it just didn’t sell. Because only about 5 percent to 10 percent of sellers are truly motivated, you may need to relax your must-have requirements in a house.
* Find a seller who doesn’t need cash upfront. Most sellers will need the money from the sale of their home to buy their next home.
Instead, look for someone who has already bought his or her next house. Vacant properties or homes that have been rental properties also are good candidates. By looking for properties like these, you’ll be working with sellers who are more likely to wait to get their money.
* Structure your offer as a lease purchase. Instead of buying right away, offer to rent the home for four or five years at a set rate.
This will help the seller cover the current costs of the property while giving you the ability to live in your home now, continue to save for the down payment and then buy the home when you’re ready.
Make sure you’re offered the option to buy the home at or below today’s value. If the seller is not willing to go along with this, then look for someone who is more motivated to sell.
See if you can get the seller to give you a credit toward the purchase of the home for each month that you pay rent.
Using these ideas, you’ll be able to buy that special house this year rather than waiting another two years or more.
If the home you get is worth $200,000 today, then at a 10 percent appreciation rate, you could make an extra $40,000 or more simply by getting into the real estate market years ahead of schedule.
Right to buy: your right to buy your home
Right to buy is one of the most popular policies that have a profound social impact increasing the owner occupancy.
Right to buy schemes introduced in 1980 has given the right to tenants to buy their property at discounted rates.
More than five million council right tenants have become homeowner through this scheme. You can be a part of the “most important social revolutions of this century” by endorsing council right to buy scheme.
If you are a secured tenant of
• a local authority
• London borough council
• Housing action trust
• Registered landlord (non charitable)
Then you are legally capable of buying the house under the Housing Act. Buying a home can be expensive. Right to buy mortgage can help you meet the cost of home.
For right to buy a council tenant needs to have two years public sector tenancy. A new council tenant that is if the tenancy began on or after 18th January 2005 will require minimum five year tenancy.
Before going to Right to buy mortgage, calculate the amount you have to pay for right to buy. Most lenders will provide 95%-100% of the right to buy amount.
To find such a lender you will be required to do some research. There will be lenders who offer specialized right to buy mortgage products.
Start the day you get council right to buy offer. The time spent on research will be the time well spent. There are companies who may try to contact you with plans to aid you with council right to buy scheme.
They may offer all in one packages including mortgage and home improvement etc. this may lead you to take a mortgage deal without bargaining or one that you can’t afford.
There may be mortgage lenders who want to tell you that buy to right scheme is nearing closure. That is, however, not true.
Discounts available on ‘right to buy’ can be anywhere between 32%-70%. The discount available with council right to buy is dependent on how many years you have spent as council tenant and the maximum discount limit of your area. Right to buy is available for both houses and flats.
• For houses the discount after two years is 32% and will add 1% for every addition year of tenancy with an upper limit of 60%.
• Flats have discount of 44% after two years and additional 2% for every year. The maximum discount for flats will be 70%.
For the 5 year schemes (tenancy starting after 18th January 2005)
• 35% for houses and 1% for each year spent as a tenant. The maximum limit is 60%.
• 50% for flats with 2% discount for every extra year. The maximum limit is 70%.
There will be different maximum discount limit for right to buy in different areas. For example
• London or south-east – £38,000.
• Eastern Region – £34,000
• South-West – £30,000
• North-West or the West Midlands – £26,000
• Wales, the East Midlands or Yorkshire and the Humber – £24,000
• North-East – £22,000
A right to buy mortgage will not make sense to you if your home is sheltered housing for elderly, only temporary accommodation, or your home is provided by the company you are working with.
Council right to buy would require some documents to be filled as part of the application process. With an RTB1 form you make an application for right to buy.
After that a notice form RTB2 form is sent to you telling whether you have right to buy. An important document called Section 125 tells you about the price you have to pay and the terms and conditions. This should to be read carefully.
Right to buy is an opportunity of becoming a homeowner at affordable rates. It is not easy to become a homeowner but it seems like a realistic possibility.
Right to buy has encouraged tenants to remain in their neighbourhood and construct stable income communities. With ‘right to buy’ any individual can hope to transform his or her life socially.
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