Simple Tips for First Time Home Buyers

"Being a first time home buyer can be both an exhilarating and frightening experience all at the same time. After all, you have probably long dreamed of the day when you would buy your first home. At the same time, purchasing a home is a major commitment that involves spending a great deal of money. Therefore, you want to make sure the purchase you make is a wise one.

In order to make sure your home buying experience is a pleasant one that results in a satisfying purchase, there are several things you need to do. These include:

• Do your homework beforehand
• Hire an agent that represents you
• Don’t overextend your budget

If you follow these three rules of thumb, you should find a great house that you can call home while also investing in a piece of real estate that will result in a nice profit when it comes time to sell.

Do Your Homework Beforehand

Doing your homework beforehand mostly involves looking at different house designs and getting a clearer idea of the type of home you would like to buy. Are there certain features that you absolutely must have in the home that you buy? Are you willing to buy a fixer upper that you can change into your dream home over the next several years? Are you more interested in finding a place you can call “home” or in a piece of real estate that will dramatically increase in value over the next several years?

Don’t forget to also do research on the neighborhoods you are considering moving to. Factors you need to consider include the crime rate, the school systems, the proximity of conveniences such as stores and gas stations, and the quality of the property in the area.

Having a clear idea of the type of home you are looking to buy will help to narrow your focus when it comes time to make the purchase. Don’t be afraid to call a broker to show you several different houses, either. Just keep in mind that the realtor the broker assigns to you is representing the seller. Therefore, you should only work with this agent to help you look at different pieces of real estate so you can get a better idea of what you are looking for.

Hire an Agent that Represents You

Once you have utilized the services of a realtor to help you look at different houses and determine the type of property you are looking for, it is time to hire an agent to represent you. With a buyer’s agent, you can be certain the realtor is looking out for your best interest rather than trying to close a sale for the seller. In this way, you can rest assured that the agent will be straightforward with you about the pros and cons of the real estate you are considering purchasing.

Don’t Overextend Your Budget

The amount of money you can afford to spend on your home will depend on a number of factors. Thankfully, there are several mortgage calculators online that will help you determine how much you can expect to pay each month toward your home depending on how much the home will cost. So, sit down and take a look at your monthly expenses in order to determine how much money you have left over to pay toward your home. Then, play around with the calculators to determine how much the total cost of the home can be while still fitting within your budget.

Keep in mind that you do not want all of your leftover money to go toward a house payment. After all, you will need extra cash to go toward unexpected expenses as well as toward entertainment and other every day expenses. A genera rule of thumb is to keep all of your debts at less than 45% of your total gross income per month. Therefore, you can follow these steps to give you an idea of how much you can afford per month:

1. Multiply your monthly gross income by 0.45
2. Subtract all of your debt payments from the resulting figure
3. Use this amount as a guideline for how much you can spend each month toward your home purchase

By staying within your budget when you buy your home, you won’t have to worry about the possibility of losing the home you always dreamed of having. Similarly, by hiring a buyer’s agent and doing your homework ahead of time, you will be certain to be pleased with your purchase for years to come."

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Author: Kinan Beck
Website: http://www.onesourceleasing.net
Added: Mon, 03 Sep 2007 08:53:13 -0500
Category: Real Estate

Home Loans & Real Estate Transactions | Tacoma, WA

Home equity loans enable a home owner to secure money using his home as collateral. This is can be helpful for borrowers looking for those with poor credit histories. Bad credit home loan lending institutions or lenders Real Estate Investing generally more open to such loans, as borrowers are fewer likely to default on costs with their land on the line. A borrower will not be able to avoid payment, enhancing the possibility that the Real Estate Investors lender will be able to bring the guarantee. Borrowers are usually drawn to home equity loans for their low interest rates. With this option, getting a bad credit home loan will be easier for a borrower to have his loan application approved. Such home loans also allow one to make tax deductible payments. Since real property is generally of substantial market value, they enable borrowers to secure a home equity loan to fund major buying decisions.
These Real Estate Web Profits include home renovation or remodeling, financing college education, buying a second home, and high-interest debt consolidation. Home equity loans also pose some problems, particularly the possibility of losing one's home if loan payment schedules are not followed. Beware Of Bad Credit Home Loan Scams. There are also many scammers with various schemes seeking unsuspecting homeowners. Borrowers must be wary of dealing with individuals and organizations focused on quickly closing a contract or seemingly unable to have terms and conditions clearly written down. In such cases, one should immediately stop proceeding and verify the lenSuper smart Web Profits der's legitimacy. Borrowers can secure the best loan package if they are supported by error-free credit reports. If these reports contain bad information, they can be fixed by credit reporting agencies or by the creditor responsible for reporting the error. When one's credit report is fixed, building credit may be necessary to enhance attractiveness to lenders. What If My Only Option Is A Bad Credit Home Loan? Unfortunately, building creditis a catch-22 situation. First-time borrowers experience problems getting credit, while those who already have credit find that they do not want or need it. However, young consumers and first-timers still need a credit history as a qualification for bigger loans. The likely scenario then is to build credit slowly. A credit history will help lenders determine if the borrower is a Jeff Adams risk or is a dependable payer. How To Avoid A Bad credit Home Loan Building credit and proving credit worthiness will help individuals in case an unexpected situation demands a loan application. For those working on their initial credit accounts, they may have to depend on a co-signer whose existing credit will be evaluated by the lender. This evaluation is needed since the co-signer effectively 'vouches' for the first-time credit builder. First-time credit users can also make use of programs that cover furniture and other significant Real Estate Investings but manageable purchases. Individuals will have less difficulty qualifying for these programs, which definitely boost efforts to build credit. Secured credit cards can be arranged with credit unions and banks. This card enables deposits to one's account and sets a credit limit, exposing the bank to minimal or practically no risk while the individual builds on his credit. After establishing a credit history as a good borrower, credit card firms, Sound Mind Investing banks and other groups are likely to approach and offer various loan packages. Individuals should be wise and not overwhelmed by the offers, selecting only those with clear-cut benefits. With some education on building credit, you can avoid a bad credit home loan altogether.




Sharon Samraj is an expert author,who is presently working on the site Jeff Adams, real estate web profits. He has written many articles in various topics like real estate investor websites, super smart web profits, Real Estate Investing.For more information contact Real estate tips, Real estate investing information, Real estate Investment tips.

By Sharon Samraj

Mortgage Lenders Explained

Mortgage Lenders Explained

For most individuals, a house is the most expensive acquisition that a person makes in his lifetime. More often than not the house is purchased on money borrowed from professional lenders. It is therefore imperative to know exactly what one is in for when one is getting their first mortgage.

Broadly speaking, the mortgage lender lends you the money that you require for your house and expects you to pay back the same within a specified time along with interest. There are two basic types of players in the mortgage market: lenders and brokers. You have the option of going directly to an authorized lender, or you could approach a mortgage broker who helps you obtain the mortgage from any of the several lenders in the market. It is a jungle out there and it might be helpful to have someone who can help you navigate in it. But remember that the fee that the mortgage broker charges may be higher than what the authorized money lenders charges. Also be aware of the fact that most of these brokers are not licensed and hence are not bound by any regulation.

What do mortgage lenders look for?

Mortgage lenders are mainly concerned about your credit report. In a credit report they scrutinize your debt ratio which is an indicator of your earnings and how much you owe, as well as over all credit rating. Proof of earnings is another key criterion to decide whether the lender will finally approve your loan amount or not. This information is generally obtained from tax returns and pay stubs submitted by you. In order to get the mortgage without much hassle, it is important to keep your records clean and unquestionable. But what if you have a not so perfect credit report? – Well in that case there are several other lenders who can still give you a loan, by charging you a higher rate of interest.

Why do mortgage lenders sometimes turn down mortgage request?

This may be due to factors such as bad credit report, low annual income or even when they are not satisfied with the house that you plan to buy.

How much of a mortgage loan can you reasonably expect from these lenders?

A kind of thumb rule states that you can get a loan amount that is 4-5 times your annual income. So the more you earn, the bigger the mortgage you are eligible for.

What is the process of obtaining a mortgage?

You can either approach the lender to get a fair assessment of your situation and ask them how much they are willing to give you, and then look for a house in that budget. You can even select a house and then apply to the lender for payment. Whichever way you go, you have to first obtain an ‘Agreement in Principle’ which states the amount the lender is willing to pay for your house. This document is valid generally for a period of 3 months or so. After this you are expected to complete the ‘Mortgage Application’ and submit the same with required documents pertaining to your financial stability and creditworthiness. The house is then inspected by a qualified valuer.

After your mortgage application is found to be satisfactory the lender will issue a ‘Mortgage Offer’, or an ‘Offer of Advance’. This document will also state the conditions on which the lender is offering you the mortgage.

What are the fees associated with mortgage application process?
One is generally required to pay an ‘Administration or Application fee’ for setting up the mortgage. A separate ‘Valuation Fee’ may sometimes also be charged.

Robert Campbell recommends that you visit http://www.mortgage-lenders-plus.com/ for more information on mortgage lenders.

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