Wednesday, August 7, 2019

Take Your Own Home Purchase Readiness Quiz

There is no doubt about it. If you are an adult with a good job, a logical mind, and an eye toward the future, you may be asking why you are not yet a homeowner. Interest rates are low, and there are homes out there waiting for buyers. While no one wants to pressure you, it does offer food for thought. How would you know if you were ready?
What questions should you ask yourself before you buy?
First, can you “show me the money?” While there are few upfront costs associated with buying a home, the down payment has got to be there, somewhere, sitting in a bank. Depending on the type of mortgage you are looking at (FHA, conventional, 203K or jumbo), you'll need between 3% to 20% of the purchase price socked away. If the property qualifies for USDA rural or you're a veteran and are eligible for a VA loan, you may be a candidate for 100% financing. Get in touch with me and I’ll help you see which program fits your situation.
The second question would be “have I been good?” We're talking about credit. You don't have to be perfect, but if your credit score is at least 620-640 or higher, you have much better odds of being approved, with a slightly lower threshold for an FHA loan. Lenders look at your credit score to determine if you are a good risk. That you pay your rent-on time. Have no issues with credit cards payments or maxed out accounts.  Making car payments on time? Of course, a steady job is key here too. You will need a two-year history in the same line of work. It can be with multiple employers but doing the same job.
The next question to ask yourself is whether you can afford a mortgage payment. Lenders look at your debt to income ratio. Different types of loans vary on these ratios, so again, check with your loan consultant, hopefully that me.
What about actually becoming a homeowner? Are you ready for the responsibility of a hot water heater failing you, a plumbing leak flooding your bathroom, or a roof that needs to be replaced in a few years? Your agent will recommend that you have the property inspected by a licensed professional and receive a report on what you're buying, but that doesn't mean you shouldn't be ready for the unexpected once you own the home. It's no longer a matter of simply picking up your phone and calling the landlord.
Another biggie is the question about truly needing a real estate agent. The answer is, yes.
It is in your best interest to have someone representing YOU!
Trying to find a home and negotiate the price is best left to a trained professional. It’s pretty common in today’s market to have multiple offers on one property, this means you will be up against another agent who has been there/done that all day long and will be acting in the interests of the seller.

As a buyer you don't pay for the services of a real estate agent, the seller will pay for your agent’s commission. Sweet right, so there is no money out of your pocket for their services. 

Plus, an agent is the neighborhood expert, advising you what you should look out for, what is happening in the area, and whether the price being asked for the home is in a reasonable range for values for that size/age home in that neighborhood. So once we’ve got you pre-approved and you are ready to go shopping for a home, ask me I’ll provide you with the name of a great real estate agent in your area.

Thank you for visiting my blog, I encourage you to leave a comment or questions. Let me know if my blog has helped you. I would love to hear your thoughts and any ideas for future posts.

Roxy Redenbaugh
SR Loan Consultant
Branch Manager

NMLS #269926 ACMC #2225

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