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Buyer
Resources

The Home Buying Process

Buying a home is a big step! Whether you're buying your first home, your dream home, or your tenth investment property, yours will be a big investment. We know how important this is to you, and we have an army of experts to make sure we find the perfect property for your unique circumstances. We know the market and love real estate, and we'll educate you throughout the buying experience.

Finding the perfect property is just one way we can help you with your real estate purchase. As real estate agents, we have ongoing access to experts in every related field from lending to relocation.

  1. Plan to Buy a Home in an Area You Intend to Stay. Make sure you can commit to remaining in one place for at least a few years. When looking at areas of interest take into consideration your job and commute time, school district, distance from loved ones and any other factors that are important to you.
  2. Check Your Credit. Since you are likely to need a mortgage to buy a house, make sure your credit history is as clean as possible. Ask for a copy of your credit report and correct any inaccuracies before you begin house hunting.
  3. Calculate your Finances. Aim for a house you can afford. The rule of thumb is that you can pay for a house that is two-and-one-half times your annual salary. Getting pre-approved by a lender will ensure that you are looking at houses in the right price range.
  4. Hire a Professional. You can use the internet to find real estate agents in your area. Also, it is best to ask for recommendations from people who have used agents when buying their home. Ask them what their experience was like and if they would use the same agent again. Interview several agents before determining the one you want to work with.
  5. Do your Homework. When making an offer on a house, your opening bid should be based on the sales trend of other homes in the neighborhood. Use a Comparable Market Analysis of homes sold in the last three months. If homes are selling five percent below the asking price, then make your offer five to ten percent below the listing price.

Preparing
To Buy

  1. Hire an Inspector. Even though your lender will require a home appraisal in order to determine the worth of the property, you should hire your own home inspector, preferably an engineer with experience in doing home surveys in the area where you are buying. This will establish if there are any problems that would require costly repairs.

1st Time
Home Buyers

Many people use real estate investments as a means to generate income and provide a viable tax shelter while still providing financial benefits to the investor. The first time home purchaser is more likely to be buying a new house for a primary residence rather than for a real estate investment. While the primary residence is still a major investment in real property, the start to finish method is a little different than it is for the investor.

The first time buyer should always start the search for their dream home with a recognized lending agent. Whether this means the loan officer at their personal bank or a more formal mortgage broker in a larger financial institution, this is the place where everything begins in the process of real estate investments.

A good mortgage broker will be able to explain all of the necessary details about the process of real estate investment. They will also be more fully qualified to look at the individual situations of the prospective homeowner and give them a more complete analysis of what financing options are available and which types of loans or mortgages will best suit the individual needs of the real estate investor.

Sometimes an option on a piece of real property will include the ability to lease to own or rent to own the property. This option is often a good idea for people who do not have a substantial amount of capital to invest as a down payment in a real estate venture. Rent to own, or lease to own will also be beneficial to many people who may have very good credit, but for whatever reasons, do have some discerning commentary in their recent financial credit reports.

Other options which may be viable are large down payments for someone who has the capital to invest, but does not have the credit. Some mortgage lenders offer very enticing deals to first time buyers, which include benefits that may not be available to other parties who are purchasing real property as an actual investment instead of buying a primary residence.

Still other mortgage and financing options include the use of zero down loans for real estate investors. These loans will usually cover all of the closing costs when buying a house as a primary residence.

Real estate investment is a major expense, and as such, it is important to know how much the homeowner has to spend before going out and trying to spend it. There are so many loan and mortgage options available to the real estate investor that it is imperative to start any home or property purchase with a lengthy discussion with the loan officer or mortgage broker in order to make sure that all of the proper options can be readily explored.

Common
Buyers
Mistakes

For the first time homeowner, the whole prospect of investing in a home of their very own can be very exciting, and very intimidating. Knowing some of the more common mistakes that real estate investors have made in the past can keep the new homebuyer from repeating these errors. Purchasing a home is the largest investment that over ninety percent of homeowners will ever make in their lives.

A very common mistake made by many real estate investors is actually not so very severe. It will however, cost them valuable time and many headaches which could otherwise be easily avoided. Most potential homeowners want to run right out and find their dream house before they worry about financing. While the emotional effects can be devastating to some people, the actual financial repercussions are not so severe. Still, sleeping in an apartment dreaming of a home that an investor may or may not ever be able to purchase is something many people would prefer to avoid.

When seeking out opportunities for real estate investment, whether for a primary residence or a secondary investment property, the real estate investor should always seek financing before looking for a new home. Unless the investor has a substantial financial holdings at hand and excellent credit, it is not likely that they will be pre-approved for any set amount. However, this will give the potential homeowner a better idea of how much home they can afford and let them seek out the best value for their money.

While the home that you have found may be the home of your dreams, why would you want to set yourself up for failure or disappointment? Knowing the approximate amount that you can feasibly receive financing for will allow you to narrow down your search to homes that will fit into your allotted budget and houses that you can be certain you are able to purchase.

On the other side of the aisle, what if the potential real estate investor is seeking only a modest home, believing that it will be easier to obtain good mortgage rates and financing for a smaller house. After having spent so much money on escrow, closing, appraisals and the other costs of investing in real property, they then discover that they could have purchased the home that they really wanted if only they would have known.

The wise real estate investor will find out at least an approximation of how much they can spend before they do any actual spending or investing. Knowing how much home can be afforded will set the homebuyer up to succeed more easily and be less likely to be faced with harsh, unexpected realities and difficulties in regards to home financing. Real estate investment is a great means of building up personal assets and a viable means to provide additional income. Knowing how to invest your finances properly in the real estate market is going to be a determining factor in the success or failure of your financial portfolio.

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