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First Time Buyers

Welcome first time buyers, here is the place you will receive the most help. First, I would like to talk to you about the difference between loan prequalification and loan preapproval. Second, I will tell you a little about what you need to know about the different loan types. Third, I will tell you about the search process. Fourth, I will tell you some of the things you should think about when looking at houses and what you may want to have inspected. Finally, I will tell you what to do to get everything underway. Click the links below to read the various sections.

Loan Prequalification versus Preapproval

Prequalification is a general review of your financial situation to provide a general price range in which to begin your search. A preapproval is a more formal process that provides an estimate of the loan and different loan types you may qualify for. It is generally good for only a limited time.

So, you ask "Should I get prequalified?" That depends. How soon do you want to buy a home? If the answer is within 3 months, then no, you should get preapproved. Since the preapproval is a more formal process it gives you a much stronger negotiating position, as long as the lender has a good reputation. If all you want is to know your general price range and you are not thinking of buying within 3 months, it is okay to get prequalified. For more information see my Prequalification, Preapproval and Loan Process brochure. Just contact me and ask for it or for any other of my other brochures.

Types of Home Loans

There are many different types of loans that you may choose from. I will break them into three most common types fixed rate mortgage, adjustable rate mortgage, and hybrid loans. A fixed rate keeps the same interest rate for the life of the loan. This type of loan is the most common type, because it is the easiest to plan your monthly payments. Adjustable rate mortgages, also known as an ARM, are loans in which the interest rate and the monthly payment can change over the life of the loan. Some buyers choose this, because of the lower starting interest rate. Hybrid is a combination of fixed and adjustable rate mortgages. The common hybrid starts as a fixed rate mortgage for a period then changes to an adjustable mortgage.

There are three different ways to get loans. They are Conventional, Federal Housing Authority (FHA), and Veterans Affairs (VA) financing. Conventional is the most flexible of the three - anyone is eligible, but it isn't insured or guaranteed by the government. The lender assumes the full risk of the loan. FHA and VA are government loan programs for people that meet certain qualification criteria. They commonly require little or no down payment. These may also sometimes be able to be passed on to subsequent buyers, which may make your property more saleable when you decide to move. For more detailed information about qualifying for any of these loan types or for referrals to lenders, please contact me.

The first step in the search process is to select a reputable Realtor. This is a major purchase so you should find a Realtor that is competent and a good fit with you. For specific things you should look for in a Realtor, please contact me for my brochure on "Finding a Real Estate Agent".

Once you have found your agent, he/she should meet with you to discuss the items you want in your new home. Where should it be located? How large or small should it be? Do you have certain features that are "must-haves?" If you are searching with someone else do both of you agree on all of those things? An agent can help you define your search criteria and then use this to review the majority of houses on the market - even if they are listed with another agent or brokerage. The search will then identify houses you will want to visit in person - called a showing. The agent will book appointments for you and will accompany you on the showing. Once you have decided on the right house (see Selecting the Right House for You) the agent will provide you information to help you make a decision on the amount to offer, write up the offer paperwork and once you have an accepted offer schedule the inspections you choose to have as well as make sure all the steps are taken to close the sale and schedule appointments as needed. As your agent I will give you periodic reports on the steps that need to be taken and the progress I am making on them on your behalf.

Selecting the Right House for You

As you are walking through a house at the showing there are several things to think about. Look at the layout of the house. Does the layout match the way you will use your new home? How do you like the kitchen? Are there enough bedrooms for what you need? Don't look at the color of the walls, or style and color of the carpet, all of these things can be changed.

After considering buying a house, look for any large cracks in walls, concrete, and siding. Cracks may indicate a problem. Look for any water damage along the floor. There are other things you can't see such as termites, mold, radon, and lead based paints that might be present in the house. Don't let this scare you - if you still like the house make an offer and then bring in an inspector to check the house out. The inspection is the time to ask questions you my have about the cracks or any thing else that you think could be wrong. As your agent, I will be with you at the inspections to make sure your questions are answered and any concerns you may have are addressed.

So what now?

Contact me for more information or to get started on the search for your first home. I look forward to helping you find your first home.

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