Purchasing a property is most likely the biggest financial decision you will ever make. Whether this is your first purchase or you are an experienced buyer, this decision must be made carefully
Why Do You Want To Buy?
Are you tired of paying rent? Have you decided to pay your own mortgage and not your landlord’s? Have you outgrown your current home? Are you looking for an investment portfolio? Are you looking for a rental property? Would you like a larger yard? Would you rather live in a different area? Do you want to shorten your commute? Having a clear sense of your reasons for buying will help you choose the right property.
Has Your Income Grown?
Property ownership is an excellent investment; whether you are looking for your dream home, a rental property, or to expand your investment portfolio. Owning real estate is one of the least risky ways to build equity or to obtain a greater return on your initial investment.
Deciding to Buy
Is it the right time to buy a house? These are the signs that tell you it is:
- You’re ready to settle down in one place for the next five years or so
- You’re financially stable and have been in the same job for at least the last two years
- You have your debt under control, with a debt-to-income ratio of no more than 45%
- You have built enough savings for a down payment. While a 20% down payment is ideal, you can find financing with as low as 3% or even zero down payment.
- You have enough cash to pay for closing costs and other home buying and homeownership expenses
- You have built a good credit score. A score of 620 is ideal and will help you qualify for most types of loans, but you can also get a mortgage with a credit score of around 500.
- The market conditions are favorable for buying
Preparing to Buy
- Shop around for a mortgage provider
If you have an excellent relationship with your bank, they may be the right lender for you. They already know your financial history, so you’ll likely get approved for a mortgage without a hitch.
However, it also pays to shop around and compare rates. Just like any business, mortgage providers have to make their products attractive to various clients, so they formulate loan packages that will appeal to a wide array of borrowers. If you don’t have the time to approach different lenders, consider working with a mortgage broker who can present several options in one sitting.
If you’re buying a home for the first time, check out 1st time home buyer programs in Pennsylvania.
- Get mortgage pre-approval
Mortgage pre-approval is important for a number of reasons:
- Most home sellers will only show their properties to buyers with pre-approval
- By knowing how much loan you’ll likely get approved for, you can set a budget and narrow down your home search
- Pre-approval can help shorten the actual mortgage approval process once you’ve found the home to buy
Finding a Buyer’s Agent
We will guide you through every step of the process of buying a home in Pennsylvania, help you understand the market, give you professional advice, and negotiate strongly on your behalf. We can devote all the time and energy needed to find the right home and do most of the hard work in buying so you can focus on other things that matter to you.
Here are some tips on how to find the right Realtor:
- Get referrals from people you know
- Search the internet for Realtors who work in your target area. Check out their websites and get information on their history, credentials, and the type of homes they specialize in. You’d want a Realtor who’s knowledgeable in the area, price points, and property type you’re interested in.
- Interview potential candidates so you’ll know what to expect and get a feel of who you’re most comfortable with
It will be our pleasure to help you with all your real estate needs in State College, Centre Hall, Bellefonte, and the surrounding communities in Centre County. Give us a call at 814.231.0101, or drop us a note here.
Looking for Homes that Fit Your Lifestyle
Make a list of the things you want in your new home, and divide them into two categories — your “Must Haves” and your “Nice to Haves”
The first list includes your non-negotiables — features that you simply can’t do without. These include the location, number of bedrooms and bathrooms, storage, and so on.
The second list includes things that will make living in the home more enjoyable, but are not on top of your priorities. These can be anything from a deck or patio and a large garden, to a swimming pool, an entertainment room, and so on.
When searching for a home, always fulfill your “Must Haves” first, then move on to your “Nice to Haves” and see how the latter affects the price. Provide your Realtor with your lists so they can also be guided in finding the right home for you.
Escrow and Appraisals
Once you’ve found the perfect home, and you and the seller agree on the price and conditions of the sale, you enter into a sales contract and the process goes to escrow.
During this period, you need to finalize the financing for the home. The lender will conduct an appraisal of the property and come up with their own valuation. If they value it less than the price you and the seller agreed upon, your options are to renegotiate with the seller, shoulder the difference, or get out of the contract.
You and the seller also need to work on removing all contingencies included in the sales contract, including completing a home inspection.
Closing the deal
In a typical closing, you, the seller, your respective agents, and other persons involved in the transaction, such as lawyers and mortgage providers, will meet at a neutral place, often the office of the title agent or escrow officer, to sign all necessary documents and pay the required fees. Alternatively, you and the seller may sign the documents separately and appoint a representative for the closing instead of coming in personally.
Once the paperwork is signed and the fees are paid, the lender releases the money to the seller and the title for the property goes to you.
Without a doubt, this is the most exciting part of your home buying journey. Make it as stress-free and enjoyable as possible with careful planning and preparation. Here are some tips to help you:
- Inform your utility providers about the transfer and make sure the electricity, gas, internet, and other utilities are working in your new home before moving in.
- Make the necessary arrangements with the moving company and get any needed permits for parking and moving activities.
- Make sure all your belongings are packed securely. Some moving companies can help with the packing, so you might want to look into that option.
Expect most homes being resold to have some flaws due to the fact that they have been lived in. However, the severity of these flaws can only be determined by a good home inspector. Getting a good home inspector is only half of the work done. Their inputs and recommendations will determine your next course of action regarding the home you consider to buy. Depending on the extent of work to be done on the home, you can opt to still buy it, let the seller take on the repairs, or leave the negotiating table and move on to the next prospect. This article tackles not just how the process of a home inspection is done but also how it can be done right.
Your credit score or credit rating is a figure that plays a significant role in the home-buying process. It represents your credit report which details your debt payment history. Everything from loan accounts paid on time to those that have gone delinquent – among many other finance-related items – are factored in to come up with this score. This is why mortgage lenders put a high tab on this credit score as it is a strong indicator of how well you can handle your finances, as well as how trustworthy you could be in paying the monthly dues. This article will walk you through the things you need to know about your credit score, its significance, as well as the appropriate score that will allow you to purchase your dream home.