You have never bought a home before, or perhaps you have bought a home but not for a number of years. Buying a home is a wonderful, and sometimes nerve-wracking experience. I can help you make it a little easier. Here are some things you should absolutely do before you set out to buy a home.
- Sit down with your checkbook, or your online bank statements and figure out what you spend your money on. And be honest. It’s better to overestimate your spending than it is to come up short every month.
- Go online and check your credit score. Most credit card companies also offer you the ability to check it for free. Run a free credit report at Credit Karma just to make sure there are no mysterious credit accounts or charges on your credit report.
- Save, Save, Save. Some financial sites will advise you to pay off all of your debts, and while that’s always a good idea, when you are trying to purchase a home, you need down payment, closing costs, moving money and a little left over for a rainy day. So my advice, pay off the smallest debts first. Then take any discretionary income and divide and conquer. Use half towards paying down debt and the other half towards beefing up your savings account.
- Stop Shopping!!! Loan underwriters will give you some leeway when they see you have a habit of saving money and not overspending. Forget about having the latest shoe styles and fancy cars. And don’t start stocking up for new things to furnish the new home you haven’t yet purchased. Remember I said save, save ,save!!
- Once you have put yourself on a path towards saving and understanding what kind of payment you can afford, then you can start to browse online. If you can only afford a payment of $1500 per month, don’t look at $400,000 homes. They will be prettier than what you can afford and it will only make you sad. Look at homes that sell for under $200,000.
Then do two more things. Call me and we can have an honest chat about what to do next, and I will then ask you to get pre-qualified with a reputable lender. I will tell you that some banks are very strict and their programs aren’t necessarily geared towards first time home buyers, so we might try to find you a lender who deals with FHA loans, where the guidelines are more forgiving.
Get on the same page!! There is nothing more difficult as an Agent than trying to play referee for a couple who cannot agree on the style, age and location of the home they want. Any trips out to look at homes will be mostly a waste of your time and mine if one of you hates everything we look at. When you look online, be realistic about what you each like and dislike.
Drive the area. If you know very little about what area you would like to live in here in Satellite Beach, it’s a good idea to take a Sunday afternoon drive and scope out some of the neighborhoods you think you might like to live in. Then call me and I can tell you what homes are selling for in those neighborhoods. If it truly is one you like and can afford, then drive it at different times of the day. Sometimes a neighborhood is quiet and lovely during the day, because everyone is at work and school. But how is it in the evenings. Are there work trucks parked on the lawns? Are there children playing? If you have children of your own, that can be a good thing. Should you be an empty nester who no longer loves the sounds of children playing, then you might want to find a different neighborhood.
Last but not least, don’t make crazy low ball offers. Follow your Realtor’s advice to get the best deal. There is nothing wrong with wanting to get a great price, but if you are going to consistently offer well under market prices for homes, you will usually be disappointed, and you will waste valuable time. I have seen many buyers consume so much time with unrealistic offers, that they end up becoming desperate buyers who then may pay too much just to close something to avoid their own deadline.
It’s my job to know what similar homes sell for, and I also know that in our current market, homes well on average for 95% of the listing price. Offer 90% if you like, and expect the seller to counter. Offer 80% and expect to hear nothing.
I stand ready to help you on your quest for a new home.
Realtor, Coldwell Banker, Satellite Beach, Fl