You’ve decided to make your move and buy your next home! Maureen Moran can make the home buying process easier. Since your home will most likely be the largest investment you will ever make, it’s important to stay organized and focused. Follow these tips and before you know it, you’ll be living in your ideal home. For additional information follow the links below.
Your tax documents, pay stubs and bank statements are documents that a mortgage broker needs in order to verify your financial health. Also, check your credit score to make sure it is in tip-top shape. If necessary, make corrections to your credit report.
To finance your new home, meet with a mortgage company. Pre-approval for a home loan is a good gauge of how much you can borrow, and it shows home sellers that you are prepared to buy. Meeting with a lender will also prepare you for closing costs. You will also need to account for moving expenses, furnishings, and updates you may want to make.
Evaluate what your family truly needs in a new home. Anticipate your future needs, such as will your family be growing, or will your job location be changing? Prioritize your list and decide what features are a must-have and what amenities can be sacrificed. Having a vision of what you want makes it easier to communicate what you are looking for. Try my HOME BUYING CHECKLIST.
Location is crucial when searching for your home. Only you can decide which location is best for you. A few considerations include: How far do you want to commute to your job? Are community schools highly rated? Do you require nearby neighborhood services such as public transportation, shopping, and amenities? You should also think about the location’s impact on the resale value of the property if you are anticipating selling in the next few years.
While touring homes, take notes and photos and we will discuss what you like or don’t like about a home. This way, when you evaluate the homes you have visited, you will have the pros and cons of each. This is a dynamic process. Inventory is changing, the interest rate is changing and your mind is changing as you distill out what you want in your next home. Keep good notes to help you stay focused.
When you find a home that meets your needs, it’s time to make an offer. I will prepare a property value study, ask if the seller has any other offers and what his motivation is for selling, deadlines, etc. We will work together to determine an appropriate initial offer price and discuss strategy. I will help you negotiate the offer. Once you have an accepted offer, follow this CONTRACT TO CLOSING CHECKLIST.
A home inspection is a great way to find any potential hiccups the home may have that you did not see during the initial home tour. Once you know what needs attention, if anything, I can go back to the seller to discuss items that should be taken care of before purchasing the home.
Closing is the final step in completing a real estate transaction. At the closing, ownership of the property is transferred to the buyer, and any costs incurred by either the buyer or the seller beyond the price of the property itself are paid.
The final papers have been signed and you have the keys to your home. It’s time to move. To make the process go more smoothly, use this MOVING DAY PREP SHEET. If you have any questions regarding maintaining your home, check my HOME MAINTENANCE SCHEDULE. If you have questions about making improvements, give me a call.
In many markets across the country, the number of buyers searching for their dream homes greatly outnumbers the number of homes for sale. This has led to a competitive marketplace where buyers often need to stand out. One way to show you are serious about buying your dream home is to get pre-qualified or pre-approved for a mortgage before starting your search.
Even if you are in a market that is not as competitive, knowing your budget will give you the confidence of knowing if your dream home is within your reach.
Freddie Mac lays out the advantages of pre-approval in the ‘My Home’ section of their website:
“It’s highly recommended that you work with your lender to get pre-approved before you begin house hunting. Pre-approval will tell you how much home you can afford and can help you move faster, and with greater confidence, in competitive markets.”
One of the many advantages of working with a local real estate professional is that many have relationships with lenders who will be able to help you with this process. Once you have selected a lender, you will need to fill out their loan application and provide them with important information regarding “your credit, debt, work history, down payment, and residential history.”
Freddie Mac describes the 4 Cs that help determine the amount you will be qualified to borrow:
Capacity - Your current and future ability to make your payments
Capital or cash reserves - The money, savings, and investments you have that can be sold quickly for cash
Collateral - The home, or type of home, that you would like to purchase
Credit - Your history of paying bills and other debts on time
Getting pre-approved is one of the key steps that will show home sellers that you are serious about buying, and it often helps speed up the process once your offer has been accepted.
Once you’ve found the right home and applied for a mortgage, there are some key things to keep in mind. You’re undoubtedly excited about the opportunity to decorate your new home, but before you make any large purchases, move your money around, or make any big-time life changes, consult your loan officer – someone who will be able to tell you how your decisions will impact your home loan.
Below is a list of Things You Shouldn’t Do After Applying for a Mortgage that is important to know – or simply just good reminders – for the process.
1. Don’t Change Jobs or the Way You Are Paid at Your Job. Your loan officer must be able to track the source and amount of your annual income. If possible, you’ll want to avoid changing from salary to commission or becoming self-employed during this time as well.
2. Don’t Deposit Cash Into Your Bank Accounts. Lenders need to source your money and cash is not really traceable. Before you deposit any amount of cash into your accounts, discuss the proper way to document your transactions with your loan officer.
3. Don’t Make Any Large Purchases Like a New Car or Furniture for Your New Home. New debt comes with it, including new monthly obligations. New obligations create new qualifications. People with new debt have higher debt to income ratios...higher ratios make for riskier loans...and sometimes qualified borrowers no longer qualify.
4. Don’t Co-Sign Other Loans for Anyone. When you co-sign, you’re obligated. As we mentioned, with that obligation comes higher ratios as well. Even if you swear you won’t be the one making the payments, your lender will have to count the payments against you.
5. Don’t Change Bank Accounts. Remember, lenders need to source and track your assets. That task is significantly easier when there’s consistency among your accounts. Before you transfer any money, speak with your loan officer.
6. Don’t Apply for New Credit. It doesn’t matter whether it’s a new credit card or a new car. When you have your credit report run by organizations in multiple financial channels (mortgage, credit card, auto, etc.), your FICO® score will be impacted. Lower credit scores can determine your interest rate and maybe even your eligibility for approval.
7. Don’t Close Any Credit Accounts. Many clients erroneously believe that having less available credit makes them less risky and more likely to be approved. Wrong. A major component of your score is your length and depth of credit history (as opposed to just your payment history) and your total usage of credit as a percentage of available credit. Closing accounts has a negative impact on both those determinants of your score.
Feel the comfort of confidence when
you buy your first home.
Understand the process, the market, and be prepared.
Realtor.com shared ‘5 Habits to Start Now if you Hope to Buy a Home.’ Below are the top three from their list with a brief description.
1. Automate Your Down Payment Savings. One way to jump-start your down payment savings is to automate your checking account to automatically save a small amount of your paycheck into a separate savings account or ‘house fund’. “Amassing enough for a down payment takes discipline & perseverance, but setting up automatic savings can make it easier. If you never see the cash, you won’t spend it.”
2. Build Your Credit History & Keep It Clean. When you go to apply for a mortgage, lenders will want to see that you have been able to pay off past debts. This means staying on top of your student loans, credit cards, and car loans and paying them on time! Credit bureaus recommend using no more than 30% of the credit available to you.
3. Practice Living on a Budget. Downsizing your spending now will allow you to save more for your down payment & pay down other debts to improve your credit score. A study by Bank of America showed that “95% of first-time buyers were willing to make sacrifices to buy their home faster.” The top 3 sacrifices cited by Millennials when saving for a home are: cutting back on new clothes, a new car, and travel.
Know your credit score
Knowing your credit score and getting a recent copy of your credit report is one of the first steps that you can take toward knowing how ready you are to start the home buying process.
Make sure all the information listed on your report is accurate and work to correct any mistakes. The higher your credit score, the more likely you will be to receive a better interest rate for your mortgage, which will translate into more ‘home for your money.’
Here are some tips for improving your credit score:
After you make an offer and it’s accepted, your next task is to have the home inspected prior to closing. The inspection period is your opportunity to complete your due diligence, and you will want to schedule it as soon as you can. You will want as much time as possible to review the report.
Depending on the contract used and the terms negotiated, you may be able to renegotiate the terms of the contract. Your agent can advise you on the best course of action once the report is filed.
How to Choose an Inspector
Your agent will most likely have a shortlist of inspectors to recommend. HGTV suggests you consider the following five areas when choosing your preferred home inspector:
1. Qualifications – Find out what’s included in your inspection and if the age or location of your home may warrant specific certifications or specialties.
2. Sample Reports – Ask for a sample inspection report so you can review how thoroughly they’ll be inspecting your dream home. In most cases, the more detailed the report, the better.
3. References – Do your homework. Ask for phone numbers and names of past clients who you can call for references.
4. Memberships – Not all inspectors belong to a national or state association of home inspectors, and membership in one of these groups should not be the only way to evaluate your choice. Membership in one of these organizations does, however, often mean continued education and training are required of the inspector.
5. Errors and Omission Insurance – Find out what the liability of the inspector or inspection company is once the inspection is over. The inspector is only human, after all, and it is possible they might miss something they should see.
Ask your inspector if it’s okay for you to tag along during the inspection, so they can point out anything that should be addressed or fixed.
Don’t be surprised to see your inspector looking very carefully at all elements of the home. The job of the inspector is to protect your investment and find any issues that may be present, including but not limited to: the roof, plumbing, electrical components, appliances, heating, and air conditioning systems, ventilation, windows, fireplace and chimney, foundation, and so much more.
To confidently point you in the right direction, here is a list of some of the most common terms used in the homebuying process.
Appraisal – A professional analysis used to estimate the value of the home. A necessary step in validating the home’s worth to you and your lender to secure financing.
Closing Costs – The fees required to complete the real estate transaction. Paid at closing, they include: points, taxes, title insurance, financing costs, and items that must be prepaid or escrowed. Ask your lender for a complete list of closing cost items.
Credit Score – A number ranging from 300-850 that is based on an analysis of your credit history. Helps lenders determine the likelihood that you’ll repay future debts.
Down Payment – Down payments are typically 3-20% of the purchase price of the home. Some 0% down programs are also available. Ask your lender for more information.
Mortgage Rate – The interest rate you pay to borrow money to buy your home. The lower the rate, the better.
Pre-Approval Letter – A letter from a lender indicating you qualify for a mortgage of a specific amount.
Real Estate Professional – An individual who provides services in buying and selling homes. Real estate professionals are there to help you through the confusing paperwork, find your dream home, negotiate any of the details that come up, and to help you know exactly what’s going on in the housing market.
"Relocated to the area and Maureen helped us learn about the area, construction, builders, etc. she was incredibly helpful and patient. It took almost a year for us to find the right home and Maureen was there helping us the entire time. She has been very helpful after close as well recommending vendors for work we wanted done. All and all just a great experience. I highly recommend Maureen."
- J&J R. (Lakview)
"My husband and I were first time home buyers. From the moment we first met with Maureen she made us feel completely comfortable with the dynamics of the home buying process. She listened to what we wanted but more importantly was able to pick up on all of our cues and anticipate our needs in only a way a person with her level of experience can. She was thoughtful, and approachable every step of the way and gave us wonderful advice. She encouraged us to ask questions and fully understand everything that was happening, which made us feel at ease. She even shared recommendations for various professionals to help get us through the process."
- A&J T. (Old Irving)