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2010 will still be a good year for those looking to buy a new home. Down payments are likely to be higher and having a good credit score is becoming more important, but interest rates have remained low and homes are very affordable.
For those looking to buy a new home in 2010, here are some resolutions that may help you while buying your home. Sure these resolutions are a little late, but late is better than never. You’ve probably already given up on your other resolutions, so another round can’t hurt.
Get Good Help:
Buying a home is extremely important, it’s usually life changing and often ends up being one of the most exciting things in your life. At the same time, you’re making a huge investment, so hire a professional to help you along the way. You wouldn’t invest 30+ % (in most cases) of your monthly income in stocks without talking with a stock broker, why take a chance on your home? Get good help in the beginning and the entire process will run smoother, but don’t just higher the agent you talk too, make sure they’re the right agent for you.
Plan to Hold:
If you’re looking for a family home, you probably won’t move-in with enough equity to flip the home in a year or two. Let’s face it, in most markets, we’re probably not looking at huge value increases for a few years, if not more. Plan to buy, relax and hold – go old school with it – and buy a home because it meets your wants and needs and not because you’re hoping it’ll make you rich.
Good Credit:
Prospective home buyers should make every effort to improve or repair their credit. Good credit equals low interest rates and less obstacles. To qualify for the best interest rates buyers will need to have a credit score higher than 760. A score below 620 will make it difficult to even qualify for an FHA loan. Maintain or repair your credit and you’ll save thousands of dollars throughout the life of your loan.
Know Your Limit:
Knowing what you can afford to spend on a new home is something you should know before you even begin looking. To know what you can afford, you should get pre-approved for a home loan. To do so, you will need tax returns, your W2 form, bank statements going back 6-months and various other documents that a lender may require. It’s important to shop around for the right lender with the best rates and payment schedules. Don’t even look at homes outside your budget, temptation may get you into something you’ll regret down the road.
Location:
Before making the final decision to buy a home, do some research on the neighborhood. Proximity to good schools, parks, shopping and express-ways could be very important to you. In addition, homes near all of these things are usually easier to resale and more valuable. However, just as important, with the current housing market, you will want to make sure that your neighborhood isn’t flooded with foreclosures that will lower the price of your home more and keep the neighborhood unstable.
Understand What You’re Signing:
Reading and signing your loan documents is often a very long and tedious process. You must keep in mind that your signature on this document means that you are committing to something for the next 15 – 30 years; that something typically comes with a substantial financial obligation each month. That alone should give you an idea of just how important it is for your to fully understand the terms of your loan and make sure all the numbers discussed and agreed upon match the numbers found on your documents. If you don’t understand and the promised figures don’t match, don’t sign.
See Also/Resources:
New Year’s Resolutions for Home Buyers – www.gazettenet.com
State-by-State Closing Costs – www.realestate.msn.com
Buying a Brand New Home from Home Builders – www.homebuying.about.com
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All sound advice here, if this was the advice given to buys a few years back we might not be in the trouble we are in today. Lets face it not too many agents where not thinking of going old school, or lenders. Today most offers will take a 20% or 30% down. That’s hard earned cash, make sure you have a solid agent working for you.
Got some great points on this blog especially “plan to hold”. A few years ago buyers were just looking to get in the market and then move up to something bigger in a few years. Thats not a good idea to do that these days.
Good Credit – is something about which I am keen to know. This has always puzzled me. Your article made a good read with great information. It is going to help all.
@Paul Caparas – I remember people were buying a home so you could sell it and buy a bigger home. People in general need to live within their means. But hey thanks for stopping by!
Good advice. All buyers should read through this before starting their home search. Speaking of “plan to hold”…we have a few clients that bought a couple of years ago and now want to sell…ain’t happening! They never informed us that they only wanted to hold the property for a couple of years. We would have advised them to just rent if we had known.
.-= Matt@Atlanta Metro Homes´s last blog ..Act NOW if you are a FHA Buyer!! =-.