The fourth annual National Housing Opportunity Pulse survey says that one out of three Americans worries about their monthly mortgage payments. The survey also lists the leading concerns associated with owning a home. Rising property taxes tops the list at 34% followed closely by increasing electrical, fuel and other energy costs at 28%, while 14% worry about rising interest rates.
What many first-time buyers do to answer some of these concerns is that they will consult with friends who own a home, neighbors or the newspaper. The problem with consulting with friends or family members is that the situation of the friends and neighbors is different than their own. The amount of the down payment, the credit scores, loan-to-value ratio, income, etc. is going to be different. So the loan products they qualify may very well be different than what their friends and neighbors’ qualified for so their eventual mortgage will definitely not be the same.
There are a few steps a first-time buyer should do to begin eliminating some of these fears:
1) First and foremost is to have a budget. Get your expenses down in writing and find out how much mortgage you can afford to pay. Find out how much money you will be willing to put down for a down payment. Also plan to have money left over for possible closing costs and for miscellaneous up keeping once you move in.
2) Meet with a lender and ask to get a FREE credit report. You need to find out what your credit is so you know what kind of loans you may qualify for. Once you meet with a lender, you will get pre-qualified for a home. This means that you are qualified to be able to be pre-approved to purchase a home. An experienced Realtor should be able to give you at least two referrals of loan officers.
3) Once you know how much home you can afford, ask your Realtor® if you can buy a condominium or a single family home and in what areas you will be able to buy your home.
4) Make a list on what features in a home are important for you. Do you want 2 bedroom 2 Bath home or a 3 Bedroom 1 Bath home? Will it be a two-story home? Do you want hardwood floors or carpet? There are many other features to list but these can at least give you a head start.
5) Think Big Picture! Know why you are buying. Are you looking to buy any home just to get your foot in the door and eventually planning to upgrade? Or are you planning to live in the home for a long time? Are you looking to invest in Real Estate down the road?
There are many other questions to ask before you buy a home. I listed just a few to get you started with your game plan and help you eliminate some of the fears. We are in a solid Buyers' Market in San Diego. There are more homes to choose from, home prices continue to go lower in some neighborhoods, homes are staying on the market longer, sellers are more willing to negotiate and interest rates are still low! So this is a great time to take the next step to get knowledgeable.
Raul Lozoya has been a licensed REALTOR working with Buyers and Sellers in San Diego, CA since 2004. Raul specializes in working with First-time buyers and has helped many first-time buyers buy their first home.
Raul Lozoya Century 21 Award 2355 Northside Dr. Ste 300 San Diego, CA 92108
Any questions or to sign up for my free monthly newsletter, give me a call at (619) 245-5221 or just send me an e-mail at raullozoya@century21award.com
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