Read on for the latest news in real estate in Wayne, Nebraska and the surrounding communities as well as useful tips for buying and selling your home. Bonus features include a look into the good, the bad, and the ugly of homeownership as shared by blog author, homeowner, property manager, and real estate broker, Trisha Peters.
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Friday, January 18, 2013

Ten Financial Tidbits for Buying a Home

Buying a home is a huge step in any person's financial life cycle.  One of the biggest decisions homebuyers have to make is who to choose for their home mortgage lending needs.  This can often require a lot of research and time checking into the different loan programs and interest rates that various lenders have to offer.  Quite a few people lean on their real estate agent to give them suggestions about loan providers who have a good reputation in the marketplace.  Here are a few of the tips that I offer to my clients and customers when they inquire about home mortgage services:

1.  Where do you bank now?  Start there.  Odds are that you have already developed a good rapport with your current lender, and he/she is very familiar with your spending and payment habits.  Continuing a relationship with someone you are already comfortable with can make the process go much more smoothly than starting from scratch.

2.  Have any of your close friends or family members recently purchased a home?  If so, speak with them about their experience and see who they recommend using for a lender.  Often times, your friends and family will gladly steer you in the right direction.

3.  What type of loan are you looking for?  Certain institutions might not offer FHA or USDA-Rural Development financing for qualified buyers.  If you are a first-time buyer or income qualified buyer, you might want to ask up front about these programs during an initial visit with a lending institution.  

4.  Have you had credit issues in the past which might make it difficult to buy a home?  If so, you might need to research options with a credit counselor prior to speaking with a lender.  Consumer Credit Counseling Service in Norfolk is designed to help people get out of debt and improve their credit scores.  Consider giving them a call at (402) 371-4656.

5. Have you checked into special housing programs offered in your community?  Talk to your real estate agent or lender about down payment assistance programs or home rehabilitation programs which might be available for first-time or income eligible buyers.  The Wayne Community Housing Development Corporation is designed to help income eligible buyers in the immediate area purchase homes by providing such assistance (acreages not included).  The program offers 20% downpayment assistance (up to $20,000 maximum) for the average home as well as home rehabilitation services.  The home must have a minimum of $1,000 worth of improvements that need to be made in order to qualify for the program.  You can call Kari Wren, WCHDC's Executive Director, at (402) 375-5266 for more information, or stop in to visit her in the Wayne Area Economic Development office located at 108 West 3rd Street, Wayne.

6.  Do you have money available for a down payment or closing costs?  Many home buyers have excellent credit, but are "cash poor" when it comes to putting money down on a home.  If you are struggling with finding the cash to cover closing costs, inquire to your lender about the availability of Federal Home Loan Bank funds.  These funds are earmarked for qualified buyers in need of financial assistance for upfront costs and are generally forgiven on a prorated basis over the course of several years.  FHLB grants are typically only available at certain times in the year, for a very limited time, and availability is never guaranteed.  To enhance your odds of getting assistance, be sure to bring this up to your lender early in the mortgage process. 

7.  Check into loan options prior to starting your home search.  Once you make the decision to purchase a home, it can be hard to resist the urge to look at several before even speaking to a lender.  Many buyers start looking for homes with high expectations of what they can truly afford.  To eliminate the disappointment of falling in love with a home that is priced above your means, talk to a lender first.  Having a solid idea of what you can afford will allow you to comfortably look at homes in your price range.  It will save both you and your real estate agent time in the long run.

8.  Take a homebuyer's education class.  Many people wait until they have already written a purchase agreement on a home before taking a class about what to do when buying a home.  Prepare yourself ahead of time by signing up for a class before you get to the purchase stage.  Most classes cover the basics of buying a home from loans, to purchase agreements, inspections, and insurance.  Wayne Community Housing Development Corporation offers various classes throughout the year in conjunction with their program.  (The next one is being offered in February here in Wayne with a fee of $25--a minimal cost for such a large investment!)

9. Shop around.  If an initial consultation does not go well with a lender or if the mortgage rate seems higher than other banks, feel free to do some additional homework.  Sometimes personalities clash or the relationship just doesn't feel right.  Be sure you feel comfortable enough to ask your mortgage lender anything and everything you want to know about financing a home purchase.  Remember, this is a big step in your financial life, and you will most likely be doing business with this bank for several years into the future.

10.  If you have any further questions about decisions relating to home financing decisions, feel free to contact me at (402) 375-1477 or  Welcome Home.

1 comment:

  1. Managing your finances should be the very first thing that you must do when buying a home. Talk to your financial adviser about this. He/she might be able to fix your finances on buying your home. If you don't have a financial adviser, you may do the math by yourself as well. Know how much you can afford. Then, set a budget for the house, including the legal fees and charges. Make sure that you still have money left for your monthly expenses, aside from the monthly amortization of the house. It won't be an easy process, but with the help of professional people, like a realtor and a lawyer, it's possible that you can get through all these easily. -Churchill Mortgage Dallas