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Saved 6/21/10 to Ask Savvy

Buying Our First House...Any Tips?


So my husband and I are in the process of buying our first home and the entire process seems more complicated than it needs to be. I think we have a great Realtor and loan agent but there is so much paperwork, disclosures, etc that is definitely a little overwhelming. Any tips for a soon to be first time home buyer?

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4 years 11 weeks
Get a Home Warrenty! A home warranty is a service contract that covers the repair or replacement of many of the most frequently occurring breakdowns of home system components and appliances Your home is most likely one of your biggest investments. Unexpected repair or replacement costs can easily strain your budget. Plus, finding an approved and insured contractor to solve your problem can be stressful and inconvenient. A home warranty cannot prevent systems or appliances from breaking down, but it can help make covered repairs or replacement easier and less costly.
Renees3 Renees3 4 years 13 weeks
In reference to the property tax issue commented on above, you can often have your loan set up with an escrow account that things like that will be paid out of. We pay extra each month to the mortgage company and they put the extra into the escrow account to pay the prop. taxes, PMI etc. It's really helpful to not have to worry about it. My main advice is to go with the flow. There will be bumps in the road, you might have to wait an extra month to get into the house, lots of things can go wrong but over all it's worth it. I just bought my first house a year ago, it was a foreclosure and was basically a nightmare. The bank was HORRIBLE at getting back to us and the process took 4 times as long as it should have. But we love our house. I don't know how far you are into the process but when looking at houses, the ones you like, take the time to drive by them at different times of day, morining when you'll be leaving for work, afternoon and night. So you can get an idea of who's around, does it look nice, will your commute be longer because there's more traffic etc. And don't be frightened away by paint. It's the EASIEST thing to fix. Check for pests/rodents, those can cause a lot of hassle and damage, have a thorough inspection and ask as many questions as you can. Good luck
imLissy imLissy 4 years 13 weeks
give yourself plenty of time, more than you think you'll need. Everything takes forever. Have documentation to back up your finances. It seemed like every two weeks the bank was asking us for statements from all our accounts and where this money came from and that money.
Spectra Spectra 4 years 13 weeks
When looking at houses, beware of any with a "special assessment" on them. That usually means that the city has done major work on the sidewalk/street in front of the house and the owner of the house is paying for it. They sometimes try to sneak that cost into the house price. Also, don't just buy a house to buy a house...be very picky! If you want a house with a giant garage and a dishwasher and hardwood floors, keep looking until you find one. And finally, when you're figuring out what you can afford, go by what you currently pay in rent each month. Your monthly payment plus your property taxes and insurance payment should be pretty similar.
insanitypepper insanitypepper 4 years 13 weeks
Don't rush the process. Make sure you're getting exactly what you want! You never know how long you'll be living there.
Natty Natty 4 years 13 weeks
This is information from a few months ago, so I'm not sure if there have been any significant changes to FHA loans. The FHA loan seems the most desirable for a first time home buyer. http://www.hud.gov/buying/loans.cfm & http://www.zillow.com/fha-loan/. With the FHA loan you will only need to put down 3.5%. However, if you have less than 20% equity in your home, a monthly mortgage insurance payment may be required. The mortgage insurance I found was around $62 for a $200,000 home. I'm not sure how accurate that is, but that is what I found. There are also several mortgage calculators that will help you take into consideration for monthly costs. This calculator seemed pretty helpful. http://www.mortgage-calc.com/mortgage/howmuchofadownpayment.html I've also been using this one: http://www.schwab.com/public/schwab/banking_lending/mortgages/tools_and_calculators/monthly_payments?cmsid=P-993171&lvl1=banking_lending&lvl2=mortgages& and a third: http://www.mortgagecalculator.org/ here is a great source for closing costs:http://www.homefair.com/articles/mortgage/closing-costs.asp?cc=1 Finally, here are the expenses that you will need to take into consideration: (based on a $200,000 loan in CA a few months ago) Down payment = 3.5% closing costs about 2-5% property taxes 1.25% (this increases annually) mortgage insurance = $62/mo (if you put down 3.5%) homeowner's insurance = depends on your coverage = $800? HOA fees = depend on the area Lender fees / housing inspection / appraisal / legal fees / title transfer... I am not a mortgage lender. However, this is the information that I have gathered. I hope it helps! Good luck!
Natty Natty 4 years 13 weeks
Also, depending on how good your lender is, (s)he can help you find some great credits or incentives, like a 10 % home improvement credit. It really pays to shop around and find someone with experience who has a great knowledge of first time home buyers loop-holes.
Natty Natty 4 years 13 weeks
I was looking into buying a house when Obama was offering the first time buyer's tax credit. There were a lot more expenses that I was not aware of. From talking to as many people as possible, here are a few cost considerations: I'm not sure what area you are looking to buy in, but for me property taxes were a big consideration. Where I was looking, property tax is about 1.25%. I've spoken with different people abut this. You can make that payment 2x a year, or do monthly payments. The monthly payment option is way more desirable, however you have to be able to make your payment for the first year in advance. Paying property tax, coupled with closing costs is a significant added expense in your down payment.
4 years 13 weeks
Get an inspection and all other tests that you can (mold, mildew, termites, etc.). Even if they say it's not "required by the bank" just cough up the few hundred dollars and have it done anyway. We learned the hard way and wound up needing to replace a $2000 heater/AC and $700 for a new dishwasher. Live and learn! But good luck!
skigurl skigurl 4 years 13 weeks
If you have a good realtor and a good mortgage guy (and a reputable lawyer), you will be okay! As long as they explain things to you! We have an amazing guy at the bank who told us everything we needed to know and if you have good people working for you, you don't need to do a whole lot. Just ask lots of questions, write stuff down, and do as they say! It's definitely complicated but these people should be doing most of the leg work for you when it comes to paperwork etc, so it shouldn't be that cumbersome.