• IF you're looking for a residence for yourself AND you're a First-time buyer: First Time Buyer: Step #1: Look into First Time Buyer programs. Call the county, town and municipality where you're interested in living and ask. Step#2: Read ALL the literature you get AND follow the directions - step-by-step. If there isn’t any First Time Buyer program: Your first step should be to get pre-approved for the mortgage. Arrange for an appointment with a loan officer at a savings & loan or a federal credit union. These lenders tend to have lower fees and rates than mortgage companies or full service banks. Bring all the applicable information about any open and closed loans. You should be as honest as possible. Ask about a 30 years or longer, fixed-rate, positive amortization, no pre-payment penalty, open-end mortgage. This means: You have 30 years or more to pay the mortgage. It has an interest rate which never changes through the term of that mortgage. Some of the payment will always be applied to the principal amount of the mortgage It can be paid off at any time without any penalty. And it can be paid off at any time. Step #4: After getting pre-approved, take a ride through those areas where you can comfortably afford to make those mortgage payments. Make notes of the "For Sale", "Sale" and "For Sale by Owner" signs in those areas. Call those people to make appointments to see those properties. IF you meet an agent you feel comfortable working with, continue working with that agent. He/She should be able to get you through the great majority of those properties you're interested in seeing. When you're ready to make that offer, make sure there is a clause or provision about a "Home Inspection". It's an investment of about $300 to $500 - maybe a little more, BUT it helps to give you a little more peace of mind. Thanks for asking your Q! I enjoyed answering it! VTY, Ron Berue Yes, that is my real last name! Sources: My wonderful family! In the real estate business over 34 years in PA. My wonderful coaches & mentors. Yes, after all these years I continue having them in my corner! THE ABSOLUTE BEST, MOST WONDERFUL real estate investment group in the world, which I was very proud to be a member of! "THE University of Hard Knocks" Also known as "life's valuable lessons".
  • Pretty simple: Only consider (at worst) a 15 yr fixed mortgage with monthly payments LESS than 25% of your monthly *take home* income. Most home buyers won't make it past that condition these days...hence the mortgage and economic mess we've allowed to flourish. Don't buy a place you can't afford. Just because you pay <y> for rent doesn't mean a <y-10%> mortgage payment is a good thing. A 30 year ARM can easily bury *YOU* financially long before the mortgage expires. If you can satisfy the "<25% of take-home is your payment on your 15 yr fixed mortgage" criteria, then you can analyzing your current savings. Are you otherwise debt free? If not, why not? You have NO business buying a home if you don't have a substantial emergency fund. David Ramsey advocates 3-6 months living expenses in liquid savings as an emergency fund. Personally, I've BEEN unemployed for over 8 months in the not so distant past, so I don't feel 3-6 months is sufficient. If you have 6-12 months living expenses stashed away in cash, then you can consider home ownership comfortably. If you have $<x> in debt and 6 months living expenses saved, then you do not have squat saved as an emergency fund because you haven't paid off your other debts. If you finance a home and have anything other than a 15 or shorter year FIXED mortgage, and/or have ANY term ARM, or owe *any* collectible debt beyond 6-12 months living expenses, then reap what you sow and give your house away a decade or so from now. IF you have satisfied the above criteria, THEN it is time to consider the more secular/mechanical/physical aspects of buying.....structural soundness, age of appliances, roof, exterior paint/siding, interior paint, carpeting, walls, gutters, infrastructure (heat/air, hot water, sewage, etc)...all the stuff you AREN'T responsible for while renting. Buying IS NOT for everyone. Buying when you're too proud to admit you're not in the position I've outlined above for a relatively safe home ownership experience is a mistake and very much the reason our housing/mortgage industry is collapsing. Please don't make this economy worse by falling in to that trap. Thanks.
  • Remember to buy what you can afford. Just because you get approved for $300,000.00 doesn't mean you have to shop for a $300,000.00 house. Shop for a $200,000.00 house and have a life beyond just making a house payment. There is nothing wrong with a 30 year mortgage, just stay away from A.R.M.s and most other creative financing.
  • if you can make a double payment on your principal the first payment you will save thousands of dollars and your fifteen year loan will be reduced to thirteen years. something like that. its worth invesigating.
  • Look over everything in the house... Have it inspected, if it's not required for your mortgage. KNOW what you're getting into. Try to make sure it has plenty of electric for your use... Remember the computer and all of it's peripherals... The TV and all of ITs (and usually, the stereo is located around the same area). If you're looking at an older house, make sure its electric panel has been updated, or that you can afford to do so. Remember that electrical items and electronics use increase every day. If you can, check out the plumbing. Copper tubing is the "norm" for water, but they've got new stuff... Make sure it will last, unless you are planning on remodeling. How updated is the insulation? Does it have enough in the attic/above ceiling space for the area? Are the walls insulated well for the area? (If it's a brick or stone house, it might not be... air-space was considered a good insulter at one time. Our house's insulation needs help!) How new is the roof and gutter system? Most last 10-15 years, though some will last longer. How new is the furnace/air conditioner? Is it installed correctly (near as you can tell)? Is it "centrally located"? (Ours, the back room and bedroom closest to the furnace heat a LOT, the bedrooms (farthest) don't that well.) When was the driveway last sealed? The concrete walk? The deck? etc. Not everything is as important to everyone, but think about your lifestyle and what's important to you... Can you do some work on the house yourself (cheapest) or do you need professionals to do it (expensive)? Can you live in the house while the work's being done? (No water/work on the plumbing may mean no toilets, no bath/shower... No electricity means no lights, clocks, computer, phone (sometimes), etc. Working on insulation means fiberglass dust, etc. Please don't think I'm trying to scare you away from buying... But if you don't think of things like the above when looking at a house, it may come back to haunt you, later. Don't let your emotions about the first house you look at convince you that it's the one. You COULD find one in a better location, or a bigger house for the same cost, or one with something else you want/need. NEVER let the agent talk you into buying without you going home and talking about it, first. They will ALWAYS say they have someone else looking at it (doesn't mean they are going to BUY it...) Look at it this way... If they DO get another buyer for the house, and their offer's accepted and yours isn't "It wasn't meant to be". If you've looked at others, you have hopefully ordered your list in "favorite" order. (Or, go out and look some more.) Enjoy it. Get ideas from each house you look at about what you would like or need, maybe to add later. Oh, and Ron's info about the banking is very good. Mine was more about the house itself! LOL Good luck! ;-)
  • oops....posted another answer instead of a continued coment...please disregard (or downrate lol)
  • go to no one knows more,on how to do it RIGHT.

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