Whether you’re new to the market or a repeat buyer, planning and researching are the keys to any real estate transaction.

A.      Having a good idea about what you’re looking for can eliminate time wasted when looking for a home.

B.      Get a pre-approval letter from a mortgage lender.  Talking to various mortgage lenders will eliminate the unknown factors about your loan. Lenders will tell you how much they are willing to lend you. You need to know how much mortgage payment you can actually afford.  You also need to take into consideration your monthly payments which may include car payment, car insurance, credit card bills, student loans, life insurance premium, etc.  In addition, you need to include the following expenses associated with monthly mortgage payment: 

• Real Estate Taxes
• Homeowner’s Insurance
• Condo Fee (in case of condominium purchase)
• PMI (Private Mortgage Insurance)
• Points – it represents percentage (i.e.1%, 2%) of the loan amount
• Buyer pays extra point(s) to the mortgage lender to receive a lower interest rate

Also ask your mortgage lender the following questions:

• Is the loan adjustable or fixed?
• What is the interest rate for 15 year, 30 year or 40 year fixed loan?
• Are there any pre-payment penalties?

Reminder:  Do not give out your personal information especially your social security number if you do not feel comfortable with your lender.  Every time lenders do an inquiry on your credit report it lowers your credit score.

C.      You need to know the following items before you invest your time driving around looking for your new home 

• Type of home (i.e. single home, multi-family, condo)        
• Town or City
• Number of rooms, bedrooms, baths, garage, and fireplace
• School system
• Neighborhood trend
• Crime rate

D.      Seek advice from your local professional real estate agent. 
      The following is a list of questions you should ask a real estate agent before hiring them. 

• Does the agent have an active real estate license in good standing?
• Is real estate their full-time career?
• What real estate designations does the agent hold?
• Does the agent belong to the Multiple Listing Service (MLS)?
• How many years of real estate experience does the agent have?
• Will the agent represents you as a buyer?
• Will the agent provide a competitive market analysis as needed?
• In exchange for your commitment, how will the agent help you accomplish your goals? 

Reminder:  You should hire a certified buyer representative (CBR). This real estate agent has gone through extensive training and has more experience in negotiating on your behalf.

You’re almost half way in your home buying process.  Now you’re ready to see the houses that you might be interested in.  Go to open houses or call your realtor to schedule showings. This should be the exciting part of the whole process.

Once you find the house that you like, then you’re ready to make an offer.  An offer includes:

• The name and address of the buyer and seller
• The address and legal description of the property you’re buying
• The purchase or offer price
• The duration of the offer
• Execution date of purchase and sale agreement
• Closing date, time and location
• Earnest/deposit amount to be held and deposited by real estate broker or real estate attorney to an escrow account.  This deposit will then become part of your down payment.
• Contingencies (mortgage contingency and home inspection contingency)
• Representations/Acknowledgements – buyer acknowledge receipt of an agency disclosure, lead paint disclosure (for residential built before 1978)
• Additional Terms/Conditions