Home buyer question

[geek4life]

I'm trying to figure out what is the best route to get started. Can anybody list a few major things that I should know as a first time home buyer? Like..
Do you apply for the loan first then go shopping for a house?

Do you need a realtor?

What mistakes not to do?

 

[warcrow]

Yes, you need find a good lender and see what you qualify for. Now, keep in mind that once you find out what you do qualify for, say $300.000 dollars, that doesnt mean you can afford a $300,000 house. Try to found out (ask the lender) what you morgage payment on a $250k loan would be. once you know what you can afford and want to spend, get a good realtor (ask around) and tell them what you're looking for: 1 story or 2? 2 bedroom? 3 bedroom? garage? and your price range.

 

[Sex Smurf]

get pre-qualified for a loan so you know your price range. You get approved for the loan after you make your offer on the house and it is accepted

find a good realtor and remember that they are working for you - so you do not have any obligation to stick with them if you don't like the way they are handling your home search. You, after all have to pay 2.5-3% commission. I was able to convince them to give me back .5% towards closing costs.

 

[rh71]

yes pre-qualification is first.. many will ask for proof too... you don't have to show them the document, but they need to know you went and got it done officially. they don't want their time wasted. True especially for For Sale By Owner sellers.

 

[richardycc]

Originally posted by: Sex Smurf
get pre-qualified for a loan so you know your price range. You get approved for the loan after you make your offer on the house and it is accepted

find a good realtor and remember that they are working for you - so you do not have any obligation to stick with them if you don't like the way they are handling your home search. You, after all have to pay 2.5-3% commission. I was able to convince them to give me back .5% towards closing costs.

did you get the money from the seller or the realtor? if its from the realtor, its totally illegal, unless you have a realtor license.

 

[IHateMyJob2004]

Also.

Don't buy the biggest house in the neighborhood. Get an average sized home. If possible, get a fixer upper as you can make a killing that route.

Three L's.. Location, location, location.

As others say about affording a home. After buying my second home, I've drawn one conclusion. Only get a loan based on your salary. Simply because you need to save/invest to and if you have alot of debt, kiss saving money good bye.

Once pre-approved, if you are apprvoed for say, $300,000, try buying a home for only 80% of what "they" say you can afford. So, try to get a home for $240,000. You can always spend more, but shoot for $240K. I would put a cap at $270K(90%).

Lender. it doesn't matter where you get a loan from in my experience. Everything is so price competitive in the mortgage industry, that looking for the best loan for a week will probably only save you $5/month. In my experience, I have found e-loan.com to be a great place to get a loan. Very easy to do actually and no mortgage brokers p'ing you off.

 

[DougK62]

Skip pre-qualification and go straight to pre-approval.

 

[LeonarD26]

Check you credit!!! You need good credit to take advantage of the great interest rates. After that, I would make a budget and see what you can really afford.

 

[Sex Smurf]

Originally posted by: richardycc

Originally posted by: Sex Smurf
get pre-qualified for a loan so you know your price range. You get approved for the loan after you make your offer on the house and it is accepted

find a good realtor and remember that they are working for you - so you do not have any obligation to stick with them if you don't like the way they are handling your home search. You, after all have to pay 2.5-3% commission. I was able to convince them to give me back .5% towards closing costs.

did you get the money from the seller or the realtor? if its from the realtor, its totally illegal, unless you have a realtor license.

From the seller. 1% went to the mortgage company, 1% went to the realtor, .5% went back to me. Usually the .5% would be the realtor's also, but he helped my brother sell his house too so he was cool with helping me out.

 

[CPA]

Originally posted by: richardycc

Originally posted by: Sex Smurf
get pre-qualified for a loan so you know your price range. You get approved for the loan after you make your offer on the house and it is accepted

find a good realtor and remember that they are working for you - so you do not have any obligation to stick with them if you don't like the way they are handling your home search. You, after all have to pay 2.5-3% commission. I was able to convince them to give me back .5% towards closing costs.

did you get the money from the seller or the realtor? if its from the realtor, its totally illegal, unless you have a realtor license.

Tell that to erealty.com I got 1%, plus the buyer agent's bonus.

Edit: hmmm...well looks like erealty no longer offers the 1% back, but I know I got it and it wasn't a problem.

 

[lykaon78]

Some practical advice from a recent home buyer (7/2004):

1. Use sites like bankrate.com that have mortgage calculators to get an idea how much house you can afford. Remember that beyond the principal and interest you need to add in home insurance, property taxes, PMI, and other miscellaneous expenses like Home Owner's Association fees.

2. Shop around for a loan. This can be difficult because you often have to compare apples to oranges. Watch for underwriting fees, fees to obtain your credit report, fees for the title company, fees for the bank or broker, title insurance, etc... I believe that companies are required to give you a truth in lending statement that should outline all of these expenses.

3. Loan applications within 7 day period are consider 1 application for credit scoring purposes (something to keep in mind if you are going to shop around).

4. Once you have a good idea about how much loan you can afford, start going to open houses that are in your price range. You don't need a realator to do this - but the realator that is hosting the open house is trying to hook in people just like you. Just tell them you are already working with a realator and they'll leave you alone (or just ignore them).

5. While looking, look for qualities in a home that you like, consider the obvious things like bedrooms, bathrooms, kitchen and yards. But don't forget the small stuff like age of the house, how much work you would have to do to make it liveable, is it clean, is the heating system older than you are (you can usually tell by looking), are the windows old?

6. Once you have a good idea of what you like, then contact a realator. They'll help you narrow your search down to your preferences and price range.


PM me if you have questions - I'd be happy to answer them.

 

[edprush]

Originally posted by: Sex Smurf
get pre-qualified for a loan so you know your price range. You get approved for the loan after you make your offer on the house and it is accepted

find a good realtor and remember that they are working for you - so you do not have any obligation to stick with them if you don't like the way they are handling your home search. You, after all have to pay 2.5-3% commission. I was able to convince them to give me back .5% towards closing costs.

huh? the buyer pays a commission?

 

[richardycc]

Originally posted by: CPA

Originally posted by: richardycc

Originally posted by: Sex Smurf
get pre-qualified for a loan so you know your price range. You get approved for the loan after you make your offer on the house and it is accepted

find a good realtor and remember that they are working for you - so you do not have any obligation to stick with them if you don't like the way they are handling your home search. You, after all have to pay 2.5-3% commission. I was able to convince them to give me back .5% towards closing costs.

did you get the money from the seller or the realtor? if its from the realtor, its totally illegal, unless you have a realtor license.

Tell that to erealty.com I got 1%, plus the buyer agent's bonus.

Edit: hmmm...well looks like erealty no longer offers the 1% back, but I know I got it and it wasn't a problem.

thats probably because they found out it was illegal, or another realtor company reported them to the board. I am just telling you what they teach me in realtor class. If they want to cheat, they can find ways around it.

 

[CPA]

Originally posted by: richardycc

Originally posted by: CPA

Originally posted by: richardycc

Originally posted by: Sex Smurf
get pre-qualified for a loan so you know your price range. You get approved for the loan after you make your offer on the house and it is accepted

find a good realtor and remember that they are working for you - so you do not have any obligation to stick with them if you don't like the way they are handling your home search. You, after all have to pay 2.5-3% commission. I was able to convince them to give me back .5% towards closing costs.

did you get the money from the seller or the realtor? if its from the realtor, its totally illegal, unless you have a realtor license.

Tell that to erealty.com I got 1%, plus the buyer agent's bonus.

Edit: hmmm...well looks like erealty no longer offers the 1% back, but I know I got it and it wasn't a problem.

thats probably because they found out it was illegal, or another realtor company reported them to the board. I am just telling you what they teach me in realtor class. If they want to cheat, they can find ways around it.

Is this a state issue, though? I would assume not all states treat realty transactions the same.

 

[Sex Smurf]

Originally posted by: edprush

Originally posted by: Sex Smurf
get pre-qualified for a loan so you know your price range. You get approved for the loan after you make your offer on the house and it is accepted

find a good realtor and remember that they are working for you - so you do not have any obligation to stick with them if you don't like the way they are handling your home search. You, after all have to pay 2.5-3% commission. I was able to convince them to give me back .5% towards closing costs.

huh? the buyer pays a commission?

Let me rephrase that for you. . . the realtor and real estate agency receives 2.5-3% commission so I was able to get .5% of that towards closing.

Better?

 

[rh71]

Originally posted by: DougK62
Skip pre-qualification and go straight to pre-approval.

whoops, it's been 2 years, I forgot the terms... yes pre-approval is what you want.

 

[Pantoot]

I was able to get 1% back from my realtor when I sold my house here in AZ.

I am getting a little less than 1% back on the purchase of new new house through lendingtree/costco.

OP: Don't forget that a new house will cost you more than just the PI/insurance/taxes, you will also have bills that likely exceed what you did renting, such as water/sanitation/sewer, even the gas/electric is likely to be more expensive. Plus there is upkeep, landscaping, and so much more to spend your money on.

Good luck!

 

[edprush]

Originally posted by: Sex Smurf



Let me rephrase that for you. . . the realtor and real estate agency receives 2.5-3% commission so I was able to get .5% of that towards closing.

Better?

yes, thanks

 

[cyclistca]

Other items

- Home inspector.

- Notary or lawyer to complete all the legal paperwork that comes with this sort of transaction.

 

[edprush]

Originally posted by: Pantoot
I was able to get 1% back from my realtor when I sold my house here in AZ.

I am getting a little less than 1% back on the purchase of new new house through lendingtree/costco.

OP: Don't forget that a new house will cost you more than just the PI/insurance/taxes, you will also have bills that likely exceed what you did renting, such as water/sanitation/sewer, even the gas/electric is likely to be more expensive. Plus there is upkeep, landscaping, and so much more to spend your money on.

Good luck!

how did you negotiate that % off/back?

 

[OffTopic1]

House ++ paper work ++ insurance ++ upgrade/repair ++ furniture ++ 5-10% error margin = total sum that you should be looking at

 

[RossMAN]

Contact Fannie Mae and do some reading, they also have a nice How Much House Can You Afford calculator.

Ask your local bank or Credit Union if they have a first time home buyers workshop? Most banks do, you just have to ask.

Send a PM to Vic he is a wealth of knowledge!

 

[Pantoot]

The selling agent was a friend's mom. The deal was structured as a 6% commission with 3% going to the buyer's agent, 2% going to her, and 1% came back to me at closing.

For the buyer's agent I filled out a form at Costco's Lending Tree link. They sent me a choice of realty companies in the area, I picked one, and an agent from there called me. I guess I lucked out because he turned out to be awesome.

Looking back, it appears that I am actually going to get closer to .5% back from the buying agent, but it beats nothing.

 

[dquan97]

I applied for a loan through 5 lenders and picked the cheapest one, which turned out to be the bank I do my business with. I realize that some lenders are willing to negotiate their fees, but none of them even came close to the deal I got. While I was getting pre-approved, we went house shopping and looked at a few houses until we found a condo that had a great location and in the middle of our activities. We just moved in last week and our 47" HDTV from Amazon just arrived!

 

[LordSnailz]

good luck, what area are you looking at?