Should I buy or continue to rent?

Buying a home can be a very good investment. This being said, renting can be a better option for some, depending on their circumstances. Interest rates have been low for several years. If interest rates are low, it actually can be cheaper to pay a mortgage than paying rent.

There are questions that you should ask yourself before deciding to buy a home. One of the most important things to consider is the length you plan on staying in a home, if you were to purchase. If the answer is only a few years, it’s likely the better decision is to continue renting. Another question to ask yourself is whether you are ready to take on the additional “responsibilities’ of owning a home. When owning a home there will be general home maintenance that should be done, are you ready for that? Buying a home is a great option in many cases, but not always.

What if I don’t have good credit?

When it comes to credit, many people have worries. The Home Ownership Center can obtain a copy of your credit report and review it with you. There may be things you can do immediately to improve your credit and your chance for qualifying for a loan. Or you may need to make a plan to repair your credit over a couple of years. The Home Ownership Center can help you do this.

Either way, too many people let fears about credit stand in their way of purchasing the home they truly want. If you take control of the issue by getting educated and making a plan, you’ll feel better and be one step closer to owning a home.

How does my credit score impact my home loan?

When determining how much home you can afford and whether you are eligible for a home loan, a lender will look at your credit score. Typically, you need a score of 580 or higher to qualify, but it is recommended to have a 620 or higher. The higher your credit score, the better lending terms you may be eligible.

What do I need to know about the home buying process?

The home buying process is exactly that, a process. There are certain steps that need to be taken to ensure the process of buying a home for the first time, goes smoothly. By understanding the process, it greatly reduces the chance that a buyer is disappointed, let down, heartbroken, or frustrated. There are many things that a first time buyer should be doing before looking for homes, such as getting a pre-approval, but also many things that a buyer should be doing once they are under contract on their future home. Many first time home buyers don’t understand why it generally takes 60 days from contract to closing. A great way to learn what you need to know is The Home Ownership Center’s “First Time Homebuyer Training Class”. Sign-up today.

What should my down payment be?

While it depends on the type of loan, most mortgage lenders require at least a 3% down payment, and FHA loans require a minimum of 3.5 percent down. The percentage you are required to put down will depend on your credit history, the type of property, and several other factors. In 2014, the average down payment was 14 percent.

I’m ready to buy a home. What’s the first step?

While attending open houses is much more exciting than filling out paperwork, the first step a homebuyer should take is getting pre-approved for a loan. This helps you determine how much house you can afford and set a firm budget. Sellers are also more inclined to take you seriously and consider your offer if they know the home is within your pre-approved limit.

After you have attended and earned your HUD certified Certificate from The Home Ownership Center’s “First Time Homebuyer Training Class”, contact at least three banks. Talking with a bank before looking at homes is strongly suggested, as there are many first time home buyer programs available. These programs can vary from state to state and county to county, so knowing exactly what’s available to you, is critical.

Another important reason to talk with a bank before looking at homes is so you understand exactly what costs are associated with buying a home. There are many home buyers who don’t understand the difference between a down payment, pre-paid items, and escrows, which can be thoroughly explained by a mortgage professional. A mortgage professional can give you advice on the type of financing you should be looking to obtain and also whether or not you should request the seller to contribute towards your closing costs, also known as a seller’s concession.

How do I search for a home?

Start by viewing MLS listings on a real estate database, such as Zillow.com or Realtor.com. You can narrow down the results by searching for homes by neighborhood (use the zip code), by your price range, and with the desired number of bedrooms and bathrooms. Your real estate agent can also research homes and make recommendations based on your criteria.

Do I really need a Realtor when buying a home?

When buying a home, it’s strongly recommended you have a Realtor. There are many reasons why you should have a Realtor represent your best interests when buying a home. Keep in mind, all Realtors are not the same! When choosing a buyers’ agent, make sure you know how to properly interview prospective Realtors when buying a home.
Attempting to buy a home without a Realtor can really make the home buying process difficult. Having a Realtor is always recommended when buying a home. One thing not to do when buying a home is calling the listing agent because you don’t want to “bother” your Realtor. Remember, the listing agent represents the seller, not you.

How many homes should I view?

There is no right or wrong number of homes you should view before making an offer. Some people find their dream home on day one while others house hunt for months. View as many as it takes to find the home that fits your needs.

What monthly expenses do I need to consider when buying a home?

Many first time home buyers make the mistake of not considering at the costs of owning a home. Online calculators on realty sites don’t always include taxes, utilities, and home and mortgage insurance. They certainly don’t allow for flooring and window treatments, which your landlord covered previously.
Double-check utilities and tax costs to avoid nasty surprises. Utility bills can be obtained from the home owner and in some cases, from the local utility company, who can provide averages over the past 12 months. Property taxes can be verified at http://hamiltoncountyauditor.org/.

Do I have the option to have any inspections?

When buying a home, you have the option to perform several types of inspections. The purchase offer you write can be contingent upon a satisfactory home inspection, pest inspection, chimney inspection, radon test, and many other inspections. In most cases, it’s recommended that when buying a home, you at the bare minimum have a home inspection. There are home inspection findings that are more common than others, however, no two homes are the same so it’s a great idea to get the home inspected.

Are there any incentives or grants available?

First time home buyers are often able to take advantage of first time home buyer grants or incentives. It’s important that a first time buyer understands that every lender is different. From the interest rate they are able to offer, the type of loan products they offer, to the incentives or grants they are able to offer.
The above advice and tips are extremely important to a first time home buyer. By understanding these tips, it can make the process not seem as “daunting” or difficult! A first time buyer needs to understand and feel comfortable with the professionals they are working with that “no question is a dumb question!”