Want to Buy a Home?  Are You Ready?

Ready to buy a home? Before you take the leap in homeownerships, there are a few things to consider before buying your first home.

Hidden costs

When purchasing a home, it’s important to know how much the house really costs.  This extends beyond the purchase price of the house.  Did you know that there are many additional costs associated with homeownership?

Depending on where you live, in addition to the mortgage payment there are various expenses including closing costs, taxes, insurance, and utility costs that could increase your monthly payments.  That’s just to name a few.  Don’t forget about maintaining the house too.  Make sure that you estimate all of the extra expenses that go along with home ownership to ensure that you don’t over-extend yourself financially.

All Mortgages are NOT the Same

Getting a mortgage is easy, right?  Not if you have a bad credit score!  If you don’t already know, your credit score is a number generated using the information in your credit report.  It is intended to predict risk of default on your debt.

Do you know your credit score?  People with a credit score above 750 get the best rates for borrowing money.   Now many credit cards offer services in which they provide you with your credit score.

Don’t have good credit?  If you are thinking about buying a home, start repairing your credit immediately.  The first thing to do is start paying down your debts.  Keep your debts below 25% of your available credit.

In addition to paying down some of your debt, run your credit report.  Make sure there are no mistakes on it.  Federal law mandates that you can get a copy of credit report from the three credit agencies (Equifax, Experian, and TransUnion) for free each year.  Watch out for websites that charge you for a credit report.  Make sure you visit www.annualcreditreport.com to get a free credit report.

Pre-approved?

Getting a pre-approval letter from the bank will let you know how much a bank is willing to lend you.  This in turn, will let you know how much property you can purchase.  Not only does it provide you with the amount of money the bank is willing to lend to you, but it also sends a message to the seller that you can afford the property and easily obtain a mortgage.  Often a deal falls apart when the buyer fails to obtain financing for a property.

Having a pre-approval letter from the bank is significant to the buyer by giving them confidence that you will be able to get a mortgage and may give you a competitive edge if there are multiple offers.

Location, Location, Location

Where do you want to live?  Selecting the perfect house can be challenging.  Often you may find a house that has many of the things that you like, but you may have to compromise on a few things.  While it is easy to change/update some things (like paint color or a bathroom remodel), one thing that won’t change is the location of the property.

Know the neighborhood that you are buying into.  If are not all that familiar with the area, make sure that you visit the area several times to get a good feel for the neighborhood.  Visiting in the morning and evening during the week and on the weekends will give you a good sense of what the area is like and what type of traffic is around. 

Once you identify the perfect house and are comfortable with the price and location, it’s time to make that offer!

Knowing your credit score, selecting and getting pre-approved for a mortgage, identifying the perfect location for your home, and understanding the hidden costs of home ownership will help you get ready to purchase your first home.

There’s no doubt that this process can be stressful.  Purchasing a house can be extremely difficult.  Using a licensed salesperson as your agent can dramatically reduce the stress and they will walk you through the complicated process of buying your house.

When searching for an agent, you need to find one you can trust.  In the Hudson Valley, call or text Chris Cammarata at (845) 420-4562.  You can also follow him on Facebook (@CPCamm), Twitter (@ChrisCamm), Instagram (CPCamm), and SnapChat (cpcamm).