Categories
Real Estate

4 Steps to Easy Home Buying

  1. Determine how much you can afford, and get pre-approved — How do you figure out how much you can afford? The recommended starting amount is a property that is two, no more than three, times your household income. Of course, your down payment, credit, and debt to income ratio will also come into play here. Once you have an idea of what your budget is, it’s time to head to the bank. The lender will help you get pre-qualified. You’ll provide basic details about your current finances, like income, savings, and investments you have. Later down the line, the banker will look a little more in-depth to get you approved for credit.
  2. Find a real estate agent and property search — Once you know what you can afford, and a general idea of what loan amount you can get approved for, it’s time to find a real estate agent to work with. Your agent will help you through the home buying process from start to finish. They can help provide you with information about the neighborhoods you are looking in. Once you find a home, that meets your needs, the agent will help you make sure the home is ready and help negotiate the sale. While looking at homes, it can be helpful to make notes of things you like and do not like to look for in future properties. Checking things like plumbing and electricity are in working order are small details that seem like no big deal, but can be costly for you if missed.
  3. You found a home, now what? — Congrats, you finally found a place that you fell in love with! Put in an offer. This moves the house into something called escrow. Now it’s time to get back with your lender. Loan approval should be an easy step since you’ve been pre-approved. You should plan to discuss your finances in more depth and bring things like w-2 and tax information, pay stubs, and bank statements. While your waiting for your loan is a prime time to have the house professionally inspected. Your agent can help arrange the inspection. The house will be checked over for anything that could need a major repair, like structural or utility damage. Depending on this inspection, you may need to negotiate fixes be completed before closing, or withdraw your interest at all. You should also have the home appraised. This will tell you that the listing price is fair for the home, and the neighborhood it’s in.
  4. Closing — You’re happy with the home inspection results are clear, the appraisal is fair, and have your loan approved so now you’re ready to start closing the sale. Your lender should arrange the paperwork to be done through a title company. This will include checking that there are no issues with the property being able to be sold and your loan information. Shortly after the paperwork is completed, the check will be delivered to the seller and the home is yours!

The right agent can be a big difference. Your agent can turn around and help you sell your previous property, or even help you move your valuables. Home buying can be stressful but with the right agent, it can be a smooth and easy process. Let Ark Realty agents help find your new home!

Categories
Real Estate

Buy or Rent? That is the Question

Congratulations on your decision to move! There is one question you should answer before you start looking. Do you want to buy it? Or rent? You may have a thought in mind already but there are pros and cons to both options, and they can change depending on where you are at this stage of life. Here are some things to consider at the beginning of your home hunting.

Commitment

Is this a permanent move? Are you thinking about growing your family? Would you move for a new job? Knowing how long you want to stay in a new home should influence your decision to rent or buy. Buying can make sense if you are planning to stay at your new location for at least 5-7 years. If you change your mind and decide to move after buying a house, you could be saddling yourself with a lot of debt and paperwork. Renters have the flexibility to sign leases and move when they want. Buying a house is a commitment and you must be prepared to stick to it. That commitment comes with a lot of benefits! You can now decorate, remodel, and make this place your own! You also have the stability of being your own landlord and not being forced to move out. Deciding the level of commitment you want to put into your new home is crucial in the buy vs. rent decision.

Freedom

Both buying and renting come with their own kinds of freedom. As mentioned in the above point, renting has a limited lease, allowing you to move once it is up, but a landlord still can ask you to leave. A house you have bought comes with the freedom to do as you please: get a cat, play your music loud, burn candles, just go crazy! Renters will have to agree to the rules put down by their landlords or face eviction. But renters make a deal with their landlords and in exchange for this rule-following, they are free from the responsibilities of repairs, maintenance, and other unpleasant duties. Homeowners have a responsibility to care for their own homes or live with the consequences. Which of these freedoms is most important to you?

Cost

Finally, we come to the cost. Many people always assume it is cheaper to rent than to buy. This is not necessarily true. You have to compare similarly sized homes and neighborhoods to get a true comparison. Several factors are still in play even then: where you live, the direction of the housing market, interest rates, and your return on investment. Here are a few things to consider. Do you have a steady income? Whether buying or renting, paying your bills is a must. Buying a home can be the same monthly cost as renting, just stretched over a longer period of time. But if your financial situation changes, it is much easier to get out of a lease than a mortgage. When buying, in addition to the initial price there are also fees, down payment, closing costs, and interest payments to consider as you budget. Depending on where you are financial, the answer to buying or renting is different for many people.

As you get started on your search, consider what is important to you. How long do you want to stay in your new home? What sort of freedom or perks are you looking forward to? How much can you afford to spend? Answering these questions can help get you on the right path to your new home. Happy hunting!