Home buying Tips
If some one is in the market for buying a dream Home.Here are some of things that might help one in making the home buying process easier.
*Some of the Builders are not building sidewalk in the community so make sure if this is a necessity for you and you can negotiate the price of home on this basis.
For home buyer there will be challenges in each step so one need to proceed with caution.Step 1. Find out the location where you want to buy the house.
Below link will give an idea where to look for
- regular agent who gets from builder 3%
- premium agent who gets from builder 6%
What is the best time to buy house
usually will give good deal after school starts and after thanksgiving
keep in mind that rezoning of school areas might affect your home price.
step 2. The items you need to look-in for (Amenities etc)?
usually builders will have specific upgrade list that you can choose from.most of the time it is better to pay and go with builder for upgrades which will be less than the market rate and will be included in the loan.
From Individual seller negotiate for the amenities/appliances if it is old and has crossed its life span.
step 3. Get a House Inspectors
If you are buying a house from ground up , it is usually better if you can visit daily to be on site to find out what exactly going on.
or It is better to appoint a third party company to monitor the construction for you.
(Continuous supervision of construction works (quality, schedule and budget))
you need at least two inspection before drywall and one before closing if you are buying a new construction.
check ashi.org for inspectors – ask in detail what they will cover
the ashi certified inspectors usually charge around $300.
For old home get the inspection report and negotiate with seller to fix the house or reduce the price. it is a good idea to go with an experienced agent if you are buying an old house. for old home if you are negotiating with the seller to fix the repair then put in the contract to get the repairs done from insured contractor.
step 4 : Loan and how much you should spend for a house
Search for Loan with less interest as well as no (private mtg interest)PMI’s in multiple places
some of the lenders you can shop around for home loans are
mortgage brokers ,
credit unions ,
bankrate.com (is good go with a online lender when you refinance) ,
local/community banks
Click here For list of credit-union-banks
should you go for ARM or fixed ?
In my observation in last couple of years people have moved out their house in appx 7-10 yr period. so if the amount for ARM and FIXED loan for 15/30 yr are almost equal then taking a 30 yr fixed loan makes sense.
Most probably you will moving out from your house that you bought in the good school district (e.g. good highschool) , after your kid completes the school to a small home/condo so for most people 7 yr arm is good choice and ARM means lower initial monthly payments and lower initial interest rate and rate will stay for a period.
How long would it take to close the deal ?
30/45 days
step 5:- calculators for mtg
dinkytown.net has some good calculators for home mtg
Closing costs?
Varies – ask for good faith estimate from lenders and go thr all the sections for comparison
usually around $2000.
How much Property taxes will be ?
check the county site. basically 1% or less than the home price.
What is good for using cooking – electricity or gas
Gas is cheaper than electricity.
How to choose Schools ?
check the builder site what school zone it is and then check the ratings for schools. if far from school then probability of rezoning is more
Interest Rate
Penfed’s rate watch for some time might be a good idea to get a sense of what the rate trend is heading.Let PenFed keep an eye on interest rates so that you don’t have to! https://penfed.mortgagewebcenter.com/CheckRates/RateWatch.asp
take penfed’s site as a base for rates
https://www.penfed.org/compare-mortgages/
should you pay points?
Each point is a like a interest that you are paying upfront. again if you are not sure if you will stay in the house for the entire period then it is a good idea to avoid them.
what you should look in APR ?
The APR is designed to present the actual cost of obtaining financing, by requiring that some, but not all, closing fees are included in the APR calculation. These fees in addition to the interest rate determine the estimated cost of financing over the full term of the loan. Since most people do not keep the mortgage for the entire loan term, it may be misleading to spread the effect of some of these up front costs over the entire loan term.
Make sure you understand the HOA and its policies and how Builder’s contract for this.
some of the things that one might need to do after closing