BNI Growth Partners Power Team
Guide To
Home Purchasing
Step 1 - The Search
Crucial aspects in your search
for a new home is to know what you can afford, where you want to live and what
style of property you would like.
Know what you can afford!
Speak with a mortgage broker or
bank mortgage department and get a
mortgage pre-approval from them. The
mortgage person should obtain your w2/1099 information, savings on hand, any
outstanding loans and other monetary documentation to properly determine what
you can afford. Be sure to ask your mortgage person for a good faith estimate of
your closing costs, so you have an idea of final layout of funds you will need
at your closing. I have seen closing costs between $3,000 to $10,000. Closing
costs include such things as real estate taxes, attorney fees, home insurance,
title insurance, ...
Once they have gone over this information, they will provide you
with a mortgage pre-approval letter that you should share with your real estate
agent.
Relevant BNI Growth Partners Real
Estate Power Team Members Are:
Real Estate Agent,
Mortgage Broker
Keep in mind that the mortgage pre-approval lets you know
what you can afford, and in general the loan amount specified does not go above
the value of the property. For example, if the mortgage pre-approval says you
can afford a $500,000 home with 20% down, the loan amount is $400,000. However,
if you purchase a $350,000, you will not be able to get a loan of $400,000, you
would be getting a $280,000 loan with your $70,000 down payment. The loan is in
line with the equity of the property.
Know where you want to live:
Research the communities you
would like to live in, then check into the properties that you can afford.
Jumping from town to town all over New Jersey will take you forever and only
serve to confuse you. Take into consideration many factors that may or may not
be an issue to you. Once you have done this you should have zeroed into a few
towns; work with a real estate agent that can assist you through the process of
purchasing a property that fits the needs you have decided are most important to
you. Some issues that you might want to consider are:
Commuting
- Do you need to
commute to NYC?
- How long a
commute are you willing to do?
- Do you need to
be near major highways?
Hospitals
- Do you need to
be near a major medical center?
Family
- Do you want to
live relatively near family members?
Schools
What type of properties do you want to consider?
Price of the property is affected by
many factors, including condition, location, upgrades, community living
(condominiums, townhouse style, cooperatives, active 55, PUDs, ...), fee-simple
(PUDs, townhouse style, ...), … Be sure
to discuss these aspects with your real estate agent to ascertain the pros and
cons of each type of community and property.
Look when you are ready to buy,
don't overload your senses
Once you have determined what
you can afford and know where you want to live, talk to your real estate agent
to help you locate the most appropriate properties for you. When going out to
see these properties, do not overload your senses, only look at 4 or 5 at a
time, seeing too many in one day will only tire you out and you will not be able
to properly
evaluate the homes you are looking at. After seeing each property, make careful
notes about your likes and dislikes and compare to previous properties you have
looked at. Be sure to share this with your real estate agent. If you do not like
a particular property, leave right away and go onto the next property.
Many of today's buyers use the
internet to pre shop, and this is a good start, but nothing beats actually
looking at the properties, and doing this with a trusted real estate agent
allows the agent to better understand what you are looking for. The real estate
agent will now be able to pre-view homes for you and alert you to properties
that are well within the criteria you are looking for. Internet shopping alone,
and depending upon photos only, may either waste your time when you go see the
property and try to figure out how that photo made the property look so good or
miss seeing the right property as the photos made the properties look so wrong.
The real estate agent will learn what you like and dislike, and be able to check
out the properties for you, photos on the web can only do so much.
Once you find the property you like, do not wait, make an
offer!
Even in a buyer’s market, I have seen
many a client lose the property they like as someone else made an offer.
Properties are moving, and chances are if the property is in a good location, in
good shape, shows well and is priced right, it will move. It can even have
multiple offers!
