EXPERT ADVICE: Tips For Buying a New Home

January 27, 2012 at 5:07 pm

Thinking about buying a home? There are so many factors to consider, and it can be hard to know where to begin. This week, Sonia Jones, our Housing Resource Director, has some helpful tips to get your started on the path to homeownership.

How much can you afford?
You don’t want to take on a mortgage that is too expensive and end up house poor. Bankrate.com has lots of helpful information, including explanations of terms like ‘debt to income ratio’ and calculators to help estimate how much of a mortgage you can afford given your income. You should also consider any other real estate that you currently own, and assess whether you would be able to afford those in addition to your new house.

You’ve heard it before: location, location, location!
There are many factors that influence the desirability of a location. Consider the property value and make sure the area you’re looking at is not a declining market area. The quality of neighborhood schools is also important. Being in a good school district increases your chances of re-selling the property in the event you move. Other important things to look at: taxes, services, crime rates, transportation, and zoning. If you find a property you like, free property value analysis tools at sites like Zillow or Home Gain are pretty accurate

Get pre-qualified for a loan.
UnderstandingHomeLoans.com lists the three most important reasons to make sure you are pre-qualified:

1. You’ll uncover credit problems
2. You’ll know how much house you can afford
3. Most real estate agents require a pre-qualification letter signed by the lender, along with a purchase contract

Be clear about the price and all other costs—don’t be afraid to ask questions.
When you find your perfect home, work with your agent to negotiate the price. When you’re ready to close the deal, make sure you understand the settlement statement, which details all the funds paid by the buyer and the seller. Request a copy of the settlement statement, review it carefully, and discuss with your agent about who pays the closing cost and any other fees associated with the loan. If anything is unclear, don’t hesitate to clarify.

For more information on home buying, visit http://www.homebuyingtips.net.

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