Brockton is the seventh largest city in Massachusetts with a population of about 95,000 people. It is sometimes referred to as the "City of Champions", due to the success of native boxers
Buying Your First Home
Buying Your First Home
8 Basics Steps to Finding and Purchasing Your First Home
Buying your first home is one of the biggest financial steps that you will
ever make. It is important to take this decision seriously. You need to take
the time prepare yourself in every aspect in order to make this a positive experience.
Here at Exit Realty Plus Braintree, we are here to help you when it
is time to buy a home.
Determine If You Are Ready to Buy a Home
You should determine if you are ready to buy a home.
Home ownership is a lot more expensive than renting. You are responsible for paying for all
the repairs. You may also have added utility costs, such as garbage and water. In
addition, to that you will need to pay for taxes and insurance related to your home. These
costs add up quickly, and if you are not financially prepared, you may end up in a very
negative position. You should take the time to get out of debt and save up an emergency
fund, before you purchase your first home. You should definitely get rid of all of your credit
card debt first. You may be under pressure to buy a home from friends or family, but you
should wait until it feels like the right time. Other circumstances like knowing you will need
to move in the next few years for work means that you may need to wait to buy a home.
Start Shopping for a Loan
Take the time to shop for a loan. You need to get pre-approved before you shop for a home.
Where should you keep your money?
Savings accounts? Money markets? Under the mattress? Here's where you should be
keeping your savings. Save Smarter!
This will help you to look within your price range. You should contact at least three people
before you decide which loan to take. A mortgage broker will look at several different loan
companies to find you the best rates. However, your small local bank or your credit union
may have options that will save you money as well.
Once you find a loan with the correct terms you can begin shopping.
Find the Best Payment Options and Loan Types
When it comes to your mortgage you may be surprised at the different loan types and payments options available to you. It can be baffling when you think about ARMS and PMI.
Usually a fixed rate 15- or 20-year loan is the best option. This can help you lock in a low
rate. You may be considering creative financing to cover the down payment, but you
should be careful when you make these choices. You want to build wealth with your home
purchase. If you make the wrong choice than you may end up hurting yourself financially. If
the market drops, or if you need to move sooner than you planned, you may find that you
are underwater on your mortgage and you owe more than your home is worth. A down
payment can help you avoid that and makes it easier to sell if you need to move.
Be Honest About What You Can Afford
You also need to determine how much home you can really afford. A good rule of thumb is to keep your mortgage along with your taxes and insurance between 25 and 30 percent of your income. Other experts advise that your home cost be limited to two and half times
your annual salary.
It can be crippling if you are house poor. If you spend too much on your mortgage you maynot be able to meet your daily obligations let alone save for retirement. A smaller
house is worth the peace of mind. If you are carrying debt (credit card or student loan
debt), you should keep your house payments on the lower end of that amount.
Find a Good Realtor
Once you have determined how much you can really spend and are pre-approved you
should find a good realtor. Your realtor should listen to your wants and needs carefully. She
may make recommendations or explain the market to help you find a home that suits your
needs and that you can afford. She should offer several different options. Once you make
an offer your realtor should work to negotiate terms that you are happy with. A good way
to find a realtor is through the recommendations of friends and colleagues.
Request a Home Inspection
Another important step is a thorough home inspection. This is different from an appraisal.
You should pay for the home inspection. The home inspector will look for hidden problems
with the home. Through the home inspection you can learn about any issues that may
prevent you from buying the home. This may include mold problems, termites, foundation
problems and a bad roof. The inspection can save you thousands in repairs later on.
Additionally you may be able to negotiate a lower price if you know the home needs a new
roof. It helps to have an independent home inspection, separate from the one the home-
owners had done. If your realtor is also representing the people you are buying the home
from, you may want to find an independent inspector to check things for you. Take the time
to find a good home inspector since this can save you a lot of money later one.
Be Patient During Escrow
Once you have bid on your home and the offer is accepted you will go into escrow. The escrow holder will work to make sure that all the documents, money and other necessary information is together before you close. Escrow is set up to protect the buyer, the seller and the lender. It can take time to complete escrow, although the time really depends on circumstances around your purchase. Once everything is completed for escrow you will sign the closing papers. You may or may not sign your mortgage papers at escrow. If you do, you can request that the bank send a representative to help you fully understand your loan.
Close and Move In!
Once you have closed on your home, it is time to move in. You can paint, unpack and enjoy your new home. Be sure that you change your address with your bank, and other
accounts. You can set up your utilities and cancel your old ones as well. This will save you
time and money, because you will avoid late fees. Some companies will waive installation
fees if you transfer your old account to your new address. Once you are settled in - enjoy -
you've worked hard for this!
Need more information or to talk to a realtor? Check out our website here!
Article reprinted from thebalance.com - written by Miriam Caldwell
Jose E Perez is the broker and owner of EXIT Realty All Stars located in Braintree, and Brockton MA, helping both buyers and sellers with all of their real estate needs. He previously worked for Centu....