BUYER'S INFORMATION
I would appreciate the opportunity to represent you in your search for a new home. If you are currently working with another broker to purchase a home, this is not a solicitation for your business.
For those of you that do not currently own a home and particularly those of you that have never owned a home, the opportunity to get you into a home is particularly rewarding for me. It is the American Dream to own a home of the type and in the location of one's choice.
Current interest rates have made home ownership more affordable than in years - many years (see Buyer Examples and Credit Scores & Scoring and Mortgage Qualification). If you have been renting for a couple of years because you feel that you can not afford a home - let's talk!
For those of you that have already enjoyed the experience of home ownership and where the current interest rates have made it possible for you to afford more space or a better location - let's talk!
For those of you purchasing a new home due to relocation - let's talk!
And, for those of you that want a second home or want to down-size - let's talk!
As your buyer's representative, I will assist you in negotiating with the seller, dealing with the paper work and dealing with entities such as seller's agents, mortgage brokers, lenders, home inspectors, home warranty companies, property insurance companies, and title insurance/escrow companies. In addition, in the case of an existing home, I will assist you by performing, a CMA, Comparative Market Analysis.
Typically, whether it's a newly constructed home or an existing home, the seller pays the buyer agent's commission. In the case of newly constructed homes, where the seller is the builder, the builder's usually have procedural rules which must be followed in order for them to pay the commission. For example, most builders require the buyer's agent (representative) to accompany the buyer and/or register the buyer on the buyer's first visit to the model homes. And remember, the people working at model homes are representatives of the seller.
Regardless of whether it is a newly constructed home or an existing home, the payment of commissions by the seller to the buyer's representative is a great benefit, of which all buyers should take advantage. The buyer should never go looking for homes without his buyer's representative. Additional information is provided in the Buyer's Agency Agreement and Agency Disclosure forms.
Deal with a professional. The state requires a certain level of training to acquire and maintain a real estate license. But only about half of those meeting the minimum qualifications for state licensing join and swear to uphold the Code of Ethics of National Association of Realtors, and it's state and local organizations. Of the members of the National Association of Realtors, only a minority spends the time and money to complete the training for a designation, or certification. When you are looking for someone to handle the largest purchases of your life, choose someone that has more education and training than the average licensed agent. Choose me, I have a BS degree and a MBA. I am a member of the National Association of Realtors. And, I have completed more hours of post licensing training than required by the state.
If you want or need to sell a home as part of your quest to buy a new home, please see my Sellers Info page.
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In addition, the following buyer information was obtained from the web site of HUD, U.S. Department of Housing and Urban Development, 451 7th Street, SW, Washington, DC 20410, Telephone: (202) 708-1112 TTY: (202) 708-1455. This and a large volume of additional information maybe obtained at the HUD web site - a link for which is provided below.
During the year 2000, the US homeownership rate reached 67.7%, the highest ever. Yet many Americans don't realize that home ownership is within their grasp. Due to HUD special programs 81% of the FHA-Insured loans went to first-time homebuyers during 2000.
FAQ's - Frequently Asked Questions
"Why should I buy, instead of rent?"
- "Answer: You'll love the feeling of having something that's yours - a home where your own personal style will tell the world who you are. A thriving vegetable garden in the backyard, a tiled entryway, a yellow kitchen, when you own, you can do it all your way! But there's more to owning a home than personal satisfaction. You can deduct the cost of your mortgage loan interest from your federal income taxes, and usually from your state taxes too. And, interest will compose nearly all of your monthly payment, for over half the number of years you'll be paying your mortgage. This adds up to hefty savings at the end of each year. And you're also allowed to deduct the property taxes you pay as a homeowner. If you rent, you write your monthly check and it's gone forever. Another financial plus in owning a home is the possibility that its value will go up through the years."
"Should I use a real estate broker?"
- "Answer: Using a real estate broker is a very good idea. All of the details involved in home buying, particularly the financial ones, can be mind-boggling. A good real estate professional can guide you through the entire process and make the experience much easier. He or she will help you figure the price range you can afford and search for homes you'll want to see. With immediate access to homes as soon as they're put on the market, the broker can save you hours of wasted time. When it's time to make an offer on a home, the broker can point out ways to structure your deal to save you money. He or she will explain the advantages and disadvantages of different types of mortgages, guide you through the paperwork, and be there to hold your hand and answer last-minute questions when you sign the final papers at closing. And, the (agent's) payment comes from the home seller - not from the buyer."
HUD also indicates that on the sale of HUD homes as seller they require the buyer to use a real estate broker to submit a bid.
"How should I select the right real estate agent?"
- "Answer: Look for an agent who listens well and understands your needs, and whose judgement you trust. The ideal agent knows the local area well and has resources and contacts to help you in your search. Overall, you want to choose an agent that makes you feel comfortable and can provide all the knowledge and services."
"What should I look for when deciding on a community."
- "Answer: Select a community that will allow you to best live your daily life. Many people choose communities based upon schools. Do you want access to shopping and public transportation? Is access to local facilities like libraries and museums important to you? Or do you prefer the peace and quiet of a rural community? When you find places that you like, talk to people that live there. They know the most about the area and will be your future neighbors. More than anything, you want a neighborhood that you feel comfortable in."
"How can I find out about local schools?"
- "Answer: You can get information about school systems by contacting the city or county school board or the local schools."
"How are pre-qualifying and pre-approval different?"
- "Answer: Pre-qualification is an informal way to see how much you may be able to borrow. You can be 'pre-qualified' over the phone with no paperwork by telling a lender your income, your long-term debts, and how large a down payment you can afford. Without an obligation, this helps you arrive at a ballpark figure of the amount you may have available to spend on a house. Pre-approval is a lender's actual commitment to lend to you. It involves assembling your financial records (see the next question) and going through a preliminary approval process. Pre-approval gives you a definite idea of what you can afford and shows sellers that you are serious about buying."
"What steps need to be taken to secure a loan?"
- "Answer: The first step in securing a loan is to complete a loan application. To do so, you'll need the following information.
- Pay stubs for the past 2-3 months
- W-2 forms for the past 2 years
- Information on long-term debts
- Recent bank statements
- Tax returns for the past 2 years
- Proof of any other income
- Address and description of the property you wish to buy
- Sales contract
If you apply for a pre-approval you will have already submitted copies of the first 6 items and possibly the last two."
"How can I find out information about my credit history?"
- "There are three major credit-reporting companies: Equifax, Experian, and Trans Union. Obtaining you credit report is as easy as calling and requesting one. Once you receive the report, it's important to verify its accuracy. Double check the 'high credit limit,' 'total loan,' and 'past due' columns. It's a good idea to get copies from all three companies to assure there are no mistakes since any of the three could be providing a report to you lender. Fees, ranging form $5-$20, are usually charged to issue credit reports but some states permit citizens to acquire a free one. Contact the reporting companies at the numbers listed for more information.
Credit Reporting Companies
- Experian 1-888-524-3666
- Equifax 1-800-685-1111
- Trans Union 1-800-916-8800
"What if I find a mistake in my credit history?"
- "Simple mistakes are easily corrected by writing to the reporting company, pointing out the error, and providing proof of the mistake. For example, if you made a payment late due to illness, explain that for the record. Lenders are usually understanding about legitimate problems."
"What is a credit bureau score and how do lenders use them?"
- "A credit bureau score is a number, based upon your credit history that represents the possibility that you will be unable to repay a loan. Lenders use it to determine your ability to qualify for a mortgage loan. The better the score, the better your chances of getting a loan. Ask your lender for details."
"How can I improve my score?"
- "There are no easy ways to improve your credit score, but you can work to keep it acceptable by maintaining a good credit history. This means paying your bills on time and not overextending yourself by buying more than you can afford."
"Are there any costs associated with the loan origination process?"
- "Yes. When you turn in your application, you'll be required to pay a loan application fee to cover the costs of underwriting the loan. This fee pays for the home appraisal, a copy of your credit report, and any additional charges that may be necessary. The application fee is generally non-refundable."
"What is a good faith estimate, and how does it help me?"
- "It's an estimate that lists all fees paid before closing, all closing costs, and any escrow costs you will encounter when purchasing a home. The lender must supply it within three days of your application so that you can make accurate judgements when shopping for a loan.
"What responsibilities do I have during the lending process?
- To ensure you won't fall victim to loan fraud, be sure to follow all of these steps as you apply for a loan.
- Be sure to read and understand everything before you sign.
- Refuse to sign any blank documents.
- Do not buy property for someone else.
- Do not overstate you income.
- Do not overstate how long you have been employed.
- Do not overstate your assets.
- Accurately report your debt.
- Do not change you income tax returns for any reason. Tell the whole truth about gifts. Do not list fake co-borrowers on your loan application.
- Be truthful about you intention to occupy the house.
- Do not provide false supporting documents.
- Let me add a very important and frequently overlooked item:
- Do not take on any large debts just before or during the loan process! Wait until the loan closes before buying large ticket items such as furniture, an appliance, or a new car.
The HUD web site has a wealth of additional information - visit it.
www.hud.gov/buying/comq.cfm