Demystifying Home Buying Myths

August 22, 2012 By Leave a Comment

Emotional and financial readiness is necessary in buying a home. As you begin with your home buying journey you need to expect the hitches and glitches that you may encounter along the process. First time home buyers feel more uneasy and apprehensive about the whole process because they don’t know anything how and where to start their search for the right home.  Below are the myths wrong expectations that hold back first time home buyers from choosing the right home:

Perfect Homes Do Not Exist

Sometimes home buyers expect all the homes they visit to acquire all the items they have listed in their wish list. And they feel bad and frustrated each time they bump into homes that lack the things they have included in their list. Consequently, you get disappointed by the thought that you cannot stumble on the home that has all the qualities that you want for a home. And people around you will tell you to keep looking because the perfect home is out there, just waiting to be found. Do not listen to these people. Instead, try to accept the reality that it is impossible to find a home that have all the things that you want to have. Bear in mind that when buying a home you need to make special considerations. Make your mind up on which items in your home wish list you would be willing to sacrifice.

Don’t Concentrate On Furnishings and Paint Color

Do not get blinded by the furnishings and paint color. Try to look closely on the things behind all those adornment. Perhaps, the newly painted wall is already decaying or the windows behind the beautiful curtains are not in good condition. As a buyer, you need to understand that most sellers will do everything only to hide the ugly things in the home they are vending.  Therefore, it is necessary that you inspect a home carefully.

Houses Are Inanimate Things, They Cannot Speak To You

When visiting homes for sale in open houses, do not expect the house to talk to or sway you to buy it. Remember that a house is a lifeless thing.  Therefore it does not have any emotion to communicate to you.  Do not let your emotion take over your head when choosing the right home to buy.

Purchase As Much Properties As You Can Afford

This statement used to be true but no longer applicable today. Prior to the incidence of the housing boom, people buy more homes as an investment for the future. However, the housing market has changed significantly and it is not a prudent decision to buy more real estate properties today. Purchase a home that will provide your essential needs.

Make use of our MLS MN database to search homes for sale in Minnesota.

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Five Things To Look For In A Lender When Buying A Home

June 30, 2012 By Leave a Comment

One of the first steps in buying a home is choosing a lender and getting pre-qualified for a loan. In Minnesota, there are a lot of financing options for home buyers and I can recommend quite a few of them. If you want to do it by yourself, we can still help out by giving you 5 things that you should look for in picking the lender to work with.

1. The loan should have a low and FIXED interest rate. The importance of this is that it makes it easier for you to gauge how much you would be paying in the future. This means you can set your budget to spend on buying a home easier.

2. Low monthly payment. The lower the payment, the more money you would have in your pocket or to put into a savings account. Remember that the cost of living could increase in the near future and you do not want to end up borrowing money to make ends meet.

3. No high closing costs. This could range from 1 to 8 percent of the price of the property although the average is between 2 to 3 percent. The higher the closing cost, the less appealing the loan would be to you or to any other buyer.

4. No teaser interest rates. Teaser is the term used for low interest rates in the beginning but would balloon in the long run. You do not want this especially if you are not sure of how financially stable you would be in the coming years what with the volatile economy.

5. The option for down payment assistance programs. These programs are designed to help low-income to moderate-income first-time home buyers.

If you want to learn more about finding the right lender, don’t hesitate to contact us and we would be happy to help you out.

 

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Still Undecided? Here Are Reasons To Buy A House

June 30, 2012 By Leave a Comment

 First-time buyers usually receive a lot of advices from friends, family, and even co-workers that the right time to buy a house is today. Well, not exactly today but it should be done as soon as possible. When pressed for reasons though, they may have different answers and for someone who is already confused, that would not help at all in enforcing your decision to buy a house.

To help you out, let’s look at the most important reasons why you should be saving now to buy your dream house in the near future.

1. Appreciation. You may have noticed that the value of real estate properties fluctuate every now and then. Over a long period of time though, the value of real estate is always increasing. The sooner you buy a property, the better return you will get from your investment in the future if you decide to sell the property.

2. Tax deductions. IRS Publication 530 cites tax information for buyers who bought their first property. The real estate property taxes paid for it are fully deductible from income tax. It would definitely be a big benefit for first-time home buyers.

3. Peace of mind. Once you have moved into your newly bought home, you can drill to your heart’s desire, you can crank up the volume on your speaker, you can paint and repaint the walls, and you can do pretty much anything you want without the fear that you will lose your security deposit.

4. It is cheaper in the long run. While renting may mean paying less monthly, buying makes more sense in the long run. After you have paid the full price of your house, you can do with it as you please. You can sell it if you want or but in renting you will have to move out once the lease is up and if you do not want to extend the contract.

These are reasons enough why you should buy a house. If you are still not convinced, let us look at your current resources financial and otherwise and gauge if you are ready to make one of the biggest investments you will make. We can also see what you can do to make you ready for buying your own house.

 

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Fees Involved In Buying A House

June 30, 2012 By Leave a Comment

We take it that you are really interested in buying a property and we commend you for that. Now, let us help you get to good feel on the process that you will soon be going through. It is not the easiest process to go through but with the right people guiding you, you could find yourself enjoying a glass of your favorite drink or beverage right in the living room of your dream home.

Before we loss track though, let us go into the meat of this topic and that is getting to know what you would and could be required to pay when buying a real estate property. Of course, the selling price is not the only amount that matters here. Here’s a quick rundown of what you have to be ready to pay for:

1. Private mortgage insurance. This will be required if you opt to take out a loan with small down payment. Of course, the lender would want to protect their investment too.

2. Homeowner’s insurance. This is very necessary. In fact, you might even be required to secure this policy before the close of the transaction.

3. Title insurance. If you want to protect yourself from faulty titles, you would need this one. It is unlikely but the person selling the property might be a fraud and this type of policy will protect you in such cases.

4. Appraisal fees. For tax purposes, the property you will be buying or just recently bought would have to be appraised to determine its fair market value.

5. Escrow fees. In many transactions, the services of an escrow would be needed especially during the closing stages of the transaction. The escrow would ensure that your money would be delivered to the seller once you have received the property.

6. Points fees. It is the fee you have to pay the bank or any lender for their services of creating the loan. A point is 1 percent of the loan.

7. Credit report fees. If you are going to take out a loan, you would need to submit a verified credit report and that would cost money.

8. Document preparation fees. As the name suggests, this is the fee for the preparation of the required documents for the loan aside of course from the credit report.

9. Survey fee. This will be required if an existing survey of the parcel of land cannot be located.

10. Property taxes. If the seller has already paid in advance the property taxes for the house in question, you would end up owing them.

11. State recording fees. This would depend on where the property is located.

If you want to learn more about these fees, don’t hesitate to contact our professional real estate agent you can trust.

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Understanding What Mortgage Is

June 30, 2012 By Leave a Comment

One of the biggest problems that first time home buyers run into in the process of home buying is the language barrier. Yes, the documents you would have to read and sign would be in English but the terms used are not necessarily easy to understand. One of the most common terms thrown around is mortgage and it is surprising to see that many interested home buyers do not have a concrete idea what it really is.

Let us first start with the definition. Mortgage is a written document containing two parties, the mortgagor and the mortgagee. The mortgagor is you, the home buyer or the borrower. The mortgagee is the lender. It could be a bank or any financial institution that would lend the money that would go toward the purchase of the property. The real estate will be used as the collateral for the loan.

In case the borrower failed to pay the loan, the lender would then have the right to gain possession of the property. This phase is foreclosure. Different states have different laws regarding the period for the property to go into foreclosure.

Now that we have a clear understanding of what a mortgage is, let us look at how you can use it to your advantage as a buyer. Let’s say that you are starting out with a family and you may think that you are too young to pay for the property in cash. You may have some sizeable amount of money in a bank but you are also planning to use it on other important things.

With a mortgage, you can afford to free up those finances. This means you would have more freedom as far as spending your savings on. You do not have to empty your savings account to buy your first house and end up with too little to spend on other important things.

If you are therefore looking to make your first home in MN, before you use an MLS MN database make sure that you understand the options open to you as a first time home buyer.

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