5 Important Things You Should Know BEFORE Buying a Home
Angel Knight ~
Diamond Realty Brokers
When it comes to buying a home, here are a few tips to help make your life easier:
- Get pre-approved with a lender before searching for a home. This will save a lot of time and frustration throughout your home search because you need to know how much you can spend and then decide what you want to spend. Once you get a pre-approval letter from your lender, the pre-approval is typically good for 30-45 days. If you haven’t purchased a property within that time-frame, the lender will have to pull your credit again and require updated income documents such as pay stubs, bank statements, W-2, 1099 etc.
- FHA now requires 3.5% down when purchasing a home that isn’t a HUD home. For example, if you purchase a $300,000 home, the required down payment would be $10,500. The pre-approval process is much easier when you know you have the required down payment. However, those who qualify for VA loans have 100% financing options. There are a few FHA down payment assistance programs. However, most of them place many restrictions on purchase price and set household income limitations.
- Hire a licensed real estate professional to help you through the process. It can be very difficult to comprehend a 20-30 page contract with addendums, legal terms, earnest money requirements and not to mention how do you know the property is worth what it is listed for? Your agent or realtor have the proper tools to find the right comparable properties that have sold in any neighborhood which you are considering purchasing your home. Furthermore, by not having your own agent, you risk not having someone who is looking out for your best interest. Remember the owner’s agent is representing the owner’s interest. Sometimes the owner’s agent can represent you too, but you have to ask yourself what is the value in having one person represent 2 different parties? You have the opportunity to make that decision.
- Hire a certified property inspector to inspect the home. The inspector can review the HVAC, electrical, plumbing, phone wiring, attics, crawl spaces and basement. If you are purchasing a new home, it is best to have your inspection before the drywall or sheetrock is installed so the inspector can inspect behind the walls of your home. Any defect prior to the installation of sheet rock could be missed. Buyers and sellers can also ask their agent how you can purchase a home warranty, even on resale homes.
- Consult with your lender to explain closing costs that you don’t understand or were not aware of on the HUD Settlement Statement. Closing costs are fees the lender charges the buyer to obtain, package and produce the loan as well as all other fees paid out to all parties associated with the closing. Property taxes, insurance, possible loan origination fees, Home Owner Association dues if applicable will all be stated on the HUD but they always need to be checked for accuracy.
- Buyers can check their FICO score at www.myfico.com
- Obtain a free copy of your credit report at www.annualcreditreport.com
- Find out how much you can afford & estimate closing cost by using our tools on http://www.atlantadiamondhomes.com
Required Disclaimer: Information considered tips only & shall not be used as advice unless you are a client of Diamond Realty Brokers.