Timber Country Real Estate

Home Buyer′s Guide

Buying your dream home could be the single largest investment you will make in your lifetime. It is a process that can seem complicated. Finding the right real estate agent is an important step in that process.

At Timber Country Real Estate, we′re here to make sure you get the most home for your money. We′ll walk you through step by step and soon you′ll be holding the keys to your own home.

	DETERMINE HOW MUCH HOME YOU CAN AFFORD. In general you can afford a home worth about three times your annual household income. If you earn $100,000, you could afford a home priced at $300,000. Monthly mortgage payments are a combination of principal, interest, homeowner′s insurance and property taxes. (Visit our Mortgage Estimator.)
	GET A COPY OF YOUR CREDIT REPORT... and "clean it up" as much as possible. Review your report to make sure you have no outstanding debts and to make sure everything on there is YOUR doing and not a mistake. Contact any businesses on your report that have bad marks against you. Either dispute the charges or pay them off if you know you owe money. (Get your free credit report at Credit Karma.)
	TALK TO A LOAN OFFICER. Go to your bank and tell them you want to buy a house. Fill out an application and get what is called a preapproval letter. You may have to pay an application fee. (Learn the difference between "prequalified" and "preapproved".) (Learn about different types of mortgages.) A prequalification is a very preliminary estimate of how much you can afford to pay for a home. The lender will base his opinion on the information you provide. Your credit and employment information typically are not validated for prequalification so the results can only be considered a rough idea of what size payment and what type of loan you might qualify for. Since the information requested for prequalification is unverified, a prequalification letter may not carry much weight but it can be a useful tool until you have the opportunity to substantiate your information. A preapproval is a written commitment from a lender or mortgage broker to finance your home purchase up to a specific amount. This indicates that the lender has scrutinized your financial history including employment verification, rental history, credit reports, pay stubs, W–2′s, tax returns, etc. Preapproval indicates to sellers that you are a pre–screened, serious home buyer. Once you have obtained a preapproval, you can shop with confidence, knowing that your odds of obtaining your desired loan are good. It′s important to note that neither a prequalification or preapproval letter is a guarantee that you will be given the loan. Even with the preapproval, there are certain details like a finalized sales contract, inspections, and appraisals that must come into play prior to the bank′s funding your new loan. ^ Hide this section
	SEARCH FOR YOUR DREAM HOME. You can access local publications highlighting available real estate in the area, contact local Neighborhood Associations, visit the local Chamber of Commerce, look on the Internet, and even drive through neighborhoods that you feel would meet your needs. The most efficient way to find homes is to allow your Timber Country Real Estate agent to keep you up–to–date on available properties that may meet your criteria and then allow your agent to screen these properties for you. When your agent presents you with a property that interests you, he or she can arrange for you to tour the property when it is convenient for you.
	WHEN YOU FIND A HOUSE, GET A DISCLOSURE. This is a list of problems with the house that the seller knows about and which they are required by law to give you.
	ASK YOUR REALTOR HOW MUCH YOU SHOULD OFFER. If after reading the disclosure you are still interested in the house, get a list of Comperables (similar homes that have sold in the same area recently) from your agent so you can get an idea of how much the house is worth. It is rare to accept the price given by the seller. Typically, you will offer slightly less than they are asking.
	YOU′LL MAKE THE OFFER BY SIGNING A CONTRACT. If the seller accepts your offer then they′ll sign too. At this point you are generally obligated to buy the house and the seller is generally obligated to sell, though depending on the wording of the contract, either of you could have the right to walk away from the deal under certain circumstances.
	HAVE THE HOUSE PROFESSIONALLY INSPECTED. This will be an out–of–pocket expense for you. If the inspection reveals problems not listed on the disclosure which will cost a lot to fix, try to get the seller to lower the price or fix the problems before the sale—or walk away from the deal if your contract allows that and if walking away is what you want to do. (Find a Real Estate Inspector.) American Home Inspection 936–632–6944 Fritz A Home Inspection Co. 936–875–4163 or Toll Free 1–800–256–6765 HomeTeam Inspection Services 936–634–7640 Inspectra Real Estate Inspection Service 936–632–2479 Jordan Services 936–632–5859 Michael Looney 936–875–4059 ^ Hide this section
	APPRAISAL AND INSURANCE The bank will have the house appraised to make sure it′s worth what you′re paying for it. This may be an out–of–pocket expense up front; otherwise it will be added to your closing costs. Also, find an insurance agent. The cost of insurance will be added to your closing costs.
	CLOSING. You go to the office that is handling the closing (a title company or an attorney, usually selected by the lender or the seller), and bring with you a bank check to cover the down payment and the closing costs (unless the closing costs are being rolled into the mortgage.)