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06-22-2006, 04:06 PM
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Hummer Guru
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Join Date: Dec 2002
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10 tips for buying a home
1. Don't buy if you can't stay put.
If you can't commit to remaining in one place for at least a few years, then owning is probably not for you, at least not yet. With the transaction costs of buying and selling a home, you may end up losing money if you sell any sooner.
2. Start by shoring up your credit.
Since you most likely will need to get a mortgage to buy a house, you must make sure your credit history is as clean as possible. A few months before you start house hunting, get copies of your credit report. Make sure the facts are correct, and fix any problems you discover. Ask me about companies that can remove erronious and old items from your credit, and really boost your score. I have seen clients get 100 points out of their score for less than $100 in a month's time!
3. Aim for a home you can really afford.
The rule of thumb is that you can buy housing that runs about two-and-one-half times your annual salary. But you'll do better to use one of many calculators available online to get a better handle on how your income, debts, and expenses affect what you can afford. Watch out for interest only and pay-option scenarios. They are great packages, but not for everyone.
4. Don't worry if you can't put down the usual 20 percent.
There are a variety of public and private lenders who, if you qualify, offer low-interest mortgages that require a down payment as small as 3 percent of the purchase price. In fact, 9 out of 10 residential mortgages we do these days require NO down payment and NO closing costs!
5. Buy in a district with good schools.
In most areas, this advice applies even if you don't have school-age children. Reason: When it comes time to sell, you'll learn that strong school districts are a top priority for many home buyers, thus helping to boost property values.
6. Get professional help.
Even though the Internet gives buyers unprecedented access to home listings, it's still a good idea to use an agent. Look for an exclusive buyer agent, if possible, who will have your interests at heart and can help you with strategies during the bidding process. The seller pays ALL real estate commissions, so it's always a good idea to have your own representation as a buyer.
7. Choose carefully between points and rate.
When picking a mortgage, you usually have the option of paying additional points -- a portion of the interest that you pay at closing -- in exchange for a lower interest rate. If you stay in the house for a long time -- say five to seven years or more -- it's usually a better deal to take the points. The lower interest rate will save you more in the long run.
8. Before house hunting, get pre-approved.
Getting pre-approved will you save yourself the grief of looking at houses you can't afford and put you in a better position to make a serious offer when you do find the right house. Not to be confused with pre-qualification, which is based on a cursory review of your finances, pre-approval from a lender is based on your actual income, debt and credit history. The pre-approval process is quick and easy. It can usually be done that day with very limited information.
9. Do your homework before bidding.
Your opening bid should be based on the sales trend of similar homes in the neighborhood. So before making it, consider sales of similar homes in the last three months. If homes have recently sold at 5 percent less than the asking price, you should make a bid that's about eight to 10 percent lower than what the seller is asking.
10. Hire a home inspector.
Sure, your lender will require a home appraisal anyway. But that's just the bank's way of determining whether the house is worth the price you've agreed to pay. Separately, you should hire your own home inspector, preferably an engineer with experience in doing home surveys in the area where you are buying. His or her job will be to point out potential problems that could require costly repairs down the road. Our last acquisition included a home inspection that uncovered almost $30,000 in necessary "health and safety" repairs. The seller agreed to fix it all, but we would have missed much of it without the inspection.
Last edited by Adam in CO : 06-22-2006 at 06:18 PM.
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06-22-2006, 04:34 PM
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Hummer Authority
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Re: 10 tips for buying a home
I think I am 1 for 10. Damn mortgage guy never should have talked me into it.
2.5 times your annual income? HAHAHA!!! Try 4+ times....and I can still make it work.
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06-22-2006, 06:14 PM
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Hummer Expert
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Join Date: Oct 2005
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Re: 10 tips for buying a home
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06-22-2006, 06:26 PM
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Hummer Guru
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Re: 10 tips for buying a home
SWEET!! When's the Barbeque???
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06-22-2006, 07:22 PM
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Hummer Expert
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Join Date: Oct 2003
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Re: 10 tips for buying a home
I guess I failed on most of the items, except, I like where I live and it is in a great neighborhoos with excellent schools.
been in the new house for 2 months at 6X my salary and still making it work
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06-22-2006, 07:38 PM
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Hummer Authority
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Re: 10 tips for buying a home
Following the 2.5 x's you salary seems far fetched. I am not sure (unless you are making 250k a year) that you could afford much house going by this rule of thumb. The others make sense. Just this one seems impossible.
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06-22-2006, 07:43 PM
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Hummer Guru
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Join Date: Apr 2005
Location: Orlando, FL
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Re: 10 tips for buying a home
Speaking of how many times your salary, thought this was interesting from last week.
How prices in 317 metro areas stack up
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06-22-2006, 07:51 PM
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Hummer Messiah
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Join Date: Apr 2003
Location: Virginia Beach
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Re: 10 tips for buying a home
Thanks alot, Newbie....
Quote:
Virginia Beach-Norfolk, VA-NC $220,000
27.5%
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That sucks.
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06-22-2006, 08:08 PM
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Hummer Expert
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Re: 10 tips for buying a home
Quote:
Originally Posted by HummBebe
SWEET!! When's the Barbeque???
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First nice weekend next spring. It takes 2 months just for permitting and another 6 months to build, so I'll shoot for April-ish, after the shop is built and the outdoor kitchen w/kegerator is installed
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06-22-2006, 08:09 PM
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Hummer Expert
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Join Date: Oct 2005
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Re: 10 tips for buying a home
Portland, OR-WA$268,500
41.1%
I WISH!!
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06-22-2006, 08:17 PM
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Re: 10 tips for buying a home
Washington, DC-VA-MD-WV $401,100
38.3%
OUCH
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06-22-2006, 08:27 PM
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Hummer Guru
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Re: 10 tips for buying a home
Quote:
Originally Posted by KenP
Thanks alot, Newbie....
That sucks.
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Sorry, but we aren't any better off down here. What really sucks is the average FL house is really small too
Orlando, FL $208,500
40.2%
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06-22-2006, 08:31 PM
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Re: 10 tips for buying a home
I'm just glad I'm not moving South
Naples, FL $383,000
102.6%
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I don't care about the "Jeep thing" as long as my mail is on time!!!
Slate Blue H3 Adventure w/sunroof, Monsoon/NAV, DVD and marker lights
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06-22-2006, 08:34 PM
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Hummer Expert
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Join Date: Oct 2003
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Re: 10 tips for buying a home
Quote:
Originally Posted by HummerNewbie
Sorry, but we aren't any better off down here. What really sucks is the average FL house is really small too
Orlando, FL $208,500
40.2%
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Trailer in a trailer park go for double that around here
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06-22-2006, 08:50 PM
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Hummer Veteran
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Re: 10 tips for buying a home
I can live anywhere I want.
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06-22-2006, 09:07 PM
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Hummer Guru
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Join Date: Apr 2005
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Re: 10 tips for buying a home
Quote:
Originally Posted by Orbital H2
Trailer in a trailer park go for double that around here
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Whatever
Anyway, not talking about the $208K average, which is low for this area of town by a loooong shot, talking about the 40.2%.
Not sure about all the figures but I know the $208K was the Orlando average 9-12 months ago and was closer to $250K this spring. As far as I have seen, prices are not coming down so all of the figures on the list could be old.
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I don't care about the "Jeep thing" as long as my mail is on time!!!
Slate Blue H3 Adventure w/sunroof, Monsoon/NAV, DVD and marker lights
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06-23-2006, 03:32 AM
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Hummer Authority
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Re: 10 tips for buying a home
I'd say #10 is the most important. The rest don't matter to me but # 10 keeps me in buisness
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06-23-2006, 04:27 AM
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Hummer Authority
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Re: 10 tips for buying a home
Adam id be interested in knowing who you have do your "credit repair". Even though the demographic in which i cater to doenst need this too often, the price is right. The guy i have been referring business charges around 750-1000 so $100 sounds like a good deal...at this price I would bet that i wouldnt had to spend my time doing it for two clients this month.
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06-23-2006, 04:47 AM
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Hummer Authority
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Join Date: Sep 2005
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Re: 10 tips for buying a home
Great tips.
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06-23-2006, 05:49 AM
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Hummer Messiah
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Join Date: Apr 2003
Location: Virginia Beach
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Re: 10 tips for buying a home
Thanks Adam.
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