Now you get to start looking at houses!!

You will have a pre-approval or a pre-qualification in your hands when you meet me after you have been to the lenders. A pre-approval means they have checked your credit and will most likely give you the money once we find "The House of your dreams". A pre-qualification means they have taken your information and have yet to check your credit but if all the infomation that you gave them is correct, they will most likely give you the loan. You need to sit and talk with the co-buyer and discuss what it is you want in a house. Sounds easy. Do you want new or older, how many bedrooms do you have to have and how many do you want to have? How many bath rooms can you get by with, more will be more costly. Can you do work on a home, and if so how much--repaint, rebuild or fix up. Do you have friends or relatives that have these skills? Will they help you and are they available to help you? How big a garage do you want? Need or want a basement? Will you keep this one or sell it when you need a bigger house. (That can make a difference on how you finance it, how long you finance it for and what you do to that first house.) These are questions that will have to have some answers or thought. Also it needs to be decided if you want a condo, a duplex where you own one side or both, or a house. Income property or not? Once these questions have answers, we will compile a list of homes to go look at. You can pick some and I will pick some and I will make appointments--usually 24 hours before we show them. We must have appointments for all the homes we show. We are almost on to the fun stuff--looking at homes.

What to do when you see the lender

The lender will ask for the information we mentioned in the previous blog--basically your income and your payments and your savings or access to additional funds. Lenders give you lots of information but you will have questions and I want you to be sure to ask those questions when you are talking to your lender. Be sure you understand what it is they tell you and if not ask them to explain and simplify the concepts. They will tell you how much your interest rate is, how much you need for the down payment, how much you need for the closing costs--this comes in the form of a "Good Faith Estimate" sheet that you get to take home. It states on there what the costs of the transaction are, where the money goes and what the banks are charging you for the loan. There can be lots of extra charges on there so that is one reason I ask you to use a local lender. Internet lenders we don't use because when we get to closing we want to be sure the money is there and you are not out on the street because the funds did not get to the title company. We can run over and talk to the lender or fix a problem here easier than we can with someone in California. I use people I know so I have control over your transaction since there are so many things that we don't have control over that can mess up a home purchase.

Why is a home a great investment now? Where do we start?

This is one of the best times to purchase a home. The interest rates are low and the prices are low too. That means the home you purchase will be a great value for the price and the rate that you will pay on your mortgage will be low and make your payments lower. A double benefit for the buyer now!
First you have to pay a visit to one of the local lenders. You will need to put down on paper the amounts you make and the amounts you owe. Be sure to include all your student loans, your car loans, your savings amounts, your retirement accounts, 401 K's, all your credit card bills, and any other income and expenses you have. Make an appointment with a lender (if you need a name give me a call and I will fix you up--815-739-6627 my cell) and take in your information. They will tell you how much home you can afford. There really are two numbers, the one is the amount that you can afford and the other one is the amount you are comfortable with. We work with the amount of home you are comfortable with. They will give you a letter of prequalification so be sure you bring that with you when you go to look at homes, because we will put that with your offer when you make it and that is one way the sellers know you are serious about buying their property and you have the funds available to do it. (It may be that you have to wait and build up some money in a savings account or that you need a co-signer, like a relative.) Start making a list of the things you need in a home and a separate list of the things that you want in a home. Buying a home is like filling a grocery bag. You only have so much money to purchase the groceries with so you start with the most important things, the bread and milk, and then you add the extras, like steak, when you see how much you still have in your wallet.

Thinking about buying a home? It's a big decision!

So you're thinking about buying a home. Great idea and a great time to start looking for a home. Someone at work or a good friend just bought one and they started you thinking about making an investment in a home but the thought is overwhelming right now. Been there, done that! When my husband and I went to purchase our first home, in a small beautiful town in Iowa, in 1971, he stood in the basement of the home we wanted and we started to figure how we could pay for it. He said this is what I will take home and this is the car payment amount and how will we be able to do this. (The payment was going to be $193 a month!!) I told him I would get a job and we didn't have any kids so we would be fine. We bought our first house for $27,500 and then added an additional 10 feet of land for another $2500 and the man who sold the 10 feet to us financed the $2500 with no interest. (You have to remember it was 1973 and some people just were kind and wanted to see two green kids start their lives with some help!) It was a good home and we lived there for 13 years. Sold it for $50,000 in a depressed market after renting it for 3 years. So much for the good old days--

Now you need to know why you should think about buying a house and how to go about it. First of all--a house is a great investment. Now is the time to talk about investments. If you invest in a roof over your head it protects you and your family from the outside elements. No one can tell you what color to paint it or what nails you can put in the walls. If you make your payments and pay your taxes no one will take it away from you for the most part. This year has been both good and bad in the real estate market. People who have sold have been able to move on and those who have made purchases have gotten low rates and great buys. And of course are living happily ever after...