HOW DO I BEGIN THE PROCESS OF BUYING A HOME?
by thinking about your situation. Are you ready to buy a home? How much
can you afford in a monthly mortgage payment? How much space do you
need? What towns do you like? After you answer these questions, make a
"To Do" list and start doing casual research. Talk to friends and
family, drive through neighborhoods. Talk to an area realtor.
HOW DOES PURCHASING A HOME COMPARE WITH RENTING?
two don't really compare at all. The one advantage of renting is being
generally free of most maintenance responsibilities. But by renting,
you lose the chance to build equity, take advantage of tax benefits,
and protect yourself against rent increases. Also, you may not be free
to decorate without permission and may be at the mercy of the landlord
for housing. Owning a home has many benefits. When you make a mortgage
payment, you are building equity. And that's an investment. Owning a
home also qualifies you for tax breaks that assist you in dealing with
your new financial responsibilities- like insurance, real estate taxes,
and upkeep- which can be substantial. But given the freedom, stability,
and security of owning your own home, they are worth it.
HOW DOES THE LENDER DECIDE THE MAXIMUM LOAN AMOUNT THAT CAN AFFORD?
lender considers your debt-to-income ratio, which is a comparison of
your gross (pre-tax) income to housing and non-housing expenses.
Non-housing expenses include such long-term debts as car or student
loan payments, alimony, or child support. According to the FHA, monthly
mortgage payments should be no more than 29% of gross income, while the
mortgage payment, combined with non-housing expenses, should total no
more than 41% of income. The lender also considers cash available for
down payment and closing costs, credit history, etc. when determining
your maximum loan amount. Your realtor can connect you with a mortgage
broker or lender who will walk you through the numbers.
HOW DO I SELECT THE RIGHT REAL ESTATE AGENT?
for an agent who listens well and understands your needs, and whose
judgment you trust. The ideal agent knows the local area well and has
resources and contacts to help you in your search. Overall, you want to
choose an agent that makes you feel comfortable and can provide all the
knowledge and services you need.
HOW CAN I DETERMINE MY HOUSING NEEDS BEFORE I BEGIN THE SEARCH?
home should fit way you live, with spaces and features that appeal to
the whole family. Before you begin looking at homes, make a list of
your priorities - things like location and size. Should the house be
close to certain schools? your job? to public transportation? How large
should the house be? What type of lot do you prefer? What kinds of
amenities are you looking for? Establish a set of minimum requirements
and a 'wish list." Minimum requirements are things that a house must
have for you to consider it, while a "wish list" covers things that
you'd like to have but aren't essential.
WHAT SHOULD I LOOK FOR WHEN DECIDING ON A COMMUNITY?
a community that will allow you to best live your daily life. Many
people choose communities based on schools. Do you want access to
shopping and public transportation? Is access to local facilities like
libraries and museums important to you? Or do you prefer the peace and
quiet of a rural community? When you find places that you like, talk to
people that live there. They know the most about the area and will be
your future neighbors. More than anything, you want a neighborhood
where you feel comfortable in. Talk to a Realtor who specializes in the
HOW CAN I FIND OUT HOW MUCH HOMES ARE SELLING FOR IN CERTAIN COMMUNITIES AND NEIGHBORHOODS?
Your Realtor should have access to comparable sales maintained on a database.
HOW CAN I FIND INFORMATION ON THE PROPERTY TAX LIABILITY?
total amount of the previous year's property taxes is generally
included in the listing information. If you don't see it, ask the
WHAT OTHER TAX ISSUES SHOULD I TAKE INTO CONSIDERATION?
in mind that your mortgage interest and real estate taxes will be
deductible. Your Realtor or accountant can give you more details on
other tax benefits and liabilities.
IS AN OLDER HOME A BETTER VALUE THAN A NEW ONE?
isn't a definitive answer to this question. You should look at each
home for its individual characteristics. Generally, older homes may be
in more established neighborhoods, offer more ambiance, and have lower
property tax rates. People who buy older homes, however, shouldn't mind
maintaining their home and making some repairs. Newer homes tend to use
more modern architecture and systems, are usually easier to maintain,
and may be more energy-efficient. People who buy new homes often don't
want to worry initially about upkeep and repairs.