Purchasing a Home in Chesterfield Hassle Free

Buying a home in Chesterfield, or anywhere else, can seem like a frightening prospect. Whether it's your first home or your fifth, so much is at stake; your savings, your credit rating, and your financial freedom. It's difficult to find the courage to sign on the dotted line even if you want that home very, very badly.

How do you determine whether the purchase of a home makes sense?

What's the easiest way to examine the whole picture from emotions to economics?

We suggest that you read this entire report before you go house hunting. You'll learn how to separate whims from true needs. You'll discover how to prepare a game plan for your real estate venture, how to research effectively, choose wisely, finance appropriately, and survive the whole process with pleasant memories of the experience.

SEVEN STEPS FOR SUCCESS

• Get pre-qualified or pre-approved by a lender.
• Establish your needs and your wants.
• Determine how much you can afford.
• Find a good real estate agent to help you.
• Find a home that meets your needs.
• Make an offer to buy a home.
• Save as much as you can on your initial investment.

STEP ONE: GET PRE-QUALIFIED OR PRE-APPROVED BY A LENDER

You can save yourself time and heartache by meeting with a lender before you start your search for a home. A lender can let you know what specific loan programs would be best for you. He can also help you understand what it takes to qualify for the loan that you want. By taking a look at your financial situation and looking at your credit history, a lender can usually give you a good idea if you can qualify for the loan amount that you want. Many lenders call this ‘Pre-Qualifying A Buyer.’

To be absolutely certain that you can be approved for a loan, you may want to ask to be “pre-approved.” In the approval process, all of your documentation is completed and submitted to an underwriter. The pre-approval that you will receive is an actual loan commitment from a lender - your guarantee of loan approval.

It is important that you are 99.9% sure you will get the financing needed and your lender will be able to perform according to the time limits in a purchase contract. If not, you could end up in the middle of a purchase and find out otherwise. If this happens, you could lose your deposit, which could be as much as 1%-5% of the purchase price. Ask for current references and check them. Ask references if there were any problems during the loan approval period, was loan approval on time, and did they close on time? Your Realtor^® can be a good source of referral for ethical and trustworthy lenders. If you would like the names of some lenders we have had good experiences with, contact us via the web, or call us at (636) 861-3790!

A good agent will not show properties to anyone who has not been pre-approved

STEP TWO: ESTABLISH YOUR NEEDS AND WANTS

Begin your search for a perfect home by making a careful assessment of the kind of home you need and want. We recommend that you write it down. Take time, right now, to be as specific as you can about your particular requirements. First, make a list of “necessities” in your home such as number of bedrooms, bathrooms, garage spaces, etc. Next, list the features that you “desire.”

STEP THREE: DETERMINE HOW MUCH YOU CAN AFFORD

Set up a budget for yourself. Decide how much you can really afford to invest and be comfortable with, for your monthly house payment. Be realistic. Most lenders suggest that your payments be no more than 28 percent of your total monthly income. Don’t forget to include taxes and insurance if you plan to escrow. Just because you are pre-approved for a loan of a certain amount does not mean you have to spend that much. You can use our mortgage calculators to help you figure this out.

STEP FOUR: FIND A GOOD REAL ESTATE AGENT TO HELP YOU

You can learn a lot about an agent by just letting them talk to you about how they help their buyers. Within a few minutes, you will probably be able to determine if this agent’s style is in line with yours.  In making your determination, we suggest you review our tips on Selecting a Real Estate Agent and then see what our clients say about us.

Ask as many questions as you can up front. Finding a good agent will save you huge amounts of time, effort, and frustration. Remember, a “Buyer’s Agent” is working for YOU! (We hope you decide that Linda and Bob Reeder are an excellent choice to be YOUR Buyer's Agent.) Contact us via the web, or call us at (636) 861-3790!

STEP FIVE: FIND A HOME THAT MEETS YOUR NEEDS

Seven tips for successful house hunting:

• When you search for a new home, use the price range that you established after getting prequalified for your home loan. If you look above that price range you may find homes that are great but don’t fit your budget at this time. If you compare all the homes you see to that budget-busting home, you might be dissatisfied with the home that is the best choice for you.
• Keep an organized record of all your research data. Write down comments about the homes that you see. Keep track of your likes and dislikes.
• Make sure that your agent is aware of your time schedule and your expectations. Do you like to look at one or two homes in a session? Four? Eight? Discuss all of this with your agent.
• Tell your agent about any homes that sound interesting and those you'd like to know more about. Include those homes you discover as you explore the area yourself or those you see advertised in the newspaper.
• If you want to spend time driving around looking at homes for yourself, ask your agent for a list of drive-by homes which you can consider first from the outside. Your agent can then make appointments to show you the interior of those that appeal to you.
• Express your likes and dislikes to your agent after you see a home. Honest communication is essential. Some buyers are shy and hesitant to tell an agent what they really think of a house. They think the agent may take it personally. Remember, the homes don't belong to the agent! You must be straight forward about your likes and dislikes to enable the agent to do the best job for you.
• Be smart in how you use your time. Let us set up our VIP Email Update Service for you directly from MARIS (the actual St. Louis area's MLS system that Realtors use). You will receive email updates within minutes of properties being entered into the system that meet your criteria, or a listed property being changed so that it now meets your criteria (e.g. price reduction). You will have it within 2 hours. Since most of the other searches offered on the internet (at least the good ones) download their information from this site, you will be hours or days ahead of your competition in learning about the new properties and price changes and have a better opportunity of getting to buy that dream home. Request Updates

STEP SIX: MAKE AN OFFER TO BUY A HOME

Your real estate agent can help you make an offer to buy the home that you select. It is important that you decide prior to viewing homes whether your agent will represent you or the seller. Some agents work only for the seller. In this case the agent may not be able to advise you in making a fair offer. By looking at homes selling in the area and the length of time it takes to sell, you should be able to get a good idea of value. Only a “Buyer’s Agent” can give you all the information necessary to make an intelligent offer in your best interests.

STEP SEVEN: SAVE AS MUCH AS YOU CAN ON YOUR INITIAL INVESTMENT

There are only two major investments to consider when buying a home. These are the initial investment (including down payment and closing costs) and the monthly payment (including principle, interest, taxes, and insurance).

Here are some ways to save on your initial investment:

• Choose a low down payment loan. You do not necessarily have to put 20 percent, or even 10%, down. You can put 5% or even 0%, down on some loans. Ask whether or nor your loan includes “private mortgage insurance” or PMI.
• As part of your offer, ask the seller to pay some of your closing costs. Sellers are usually allowed to contribute to a buyer's closing costs. In many cases this is a negotiable item. (Remember, the seller wants as much as possible for their home and this will reduce their proceeds.)
• Shop around for your home insurance. A little shopping can save you a significant amount of money.
• You can deduct money paid for discount points from your gross income before computing your tax, which would effectively reduce the cost to you. Always check with your CPA to find out specifics regarding your specific financial situation.
• Don't forget that you will have initial costs for inspections, surveys, title insurance. pre-paid homeowner's insurance, escrow accounts, loan fees, and closing costs.

Keep your monthly payments low

• Get a loan with no monthly mortgage insurance premiums. You may be able to reduce or eliminate them by paying a little more at closing. By putting 20 percent or more down, you may be able to eliminate them entirely. Also, some lenders may be able to do this with even smaller down payments.
• Choose an Adjustable Rate Mortgage. ARMs can be up to 3 percent lower than fixed rates. This can be a great savings if you do not plan on keeping the property for a long period
• Remember that interest payments on a primary residential mortgage are fully deductible in most circumstances. Your property taxes may also be deductible. Tax rates definitely favor homeowners.

Be sure to also look at the articles on Being a Competent Buyer and Eight Sins to Avoid When Buying a Home

 

Contact us via the web, or call us at (636) 861-3790!