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Owning your first home does not have to be scary. It can be fun if you understand your market, understand your mortgage, and understand what you can handle. There are two types of markets. One type is the buyer's market and the other is the seller's market. Knowing the difference can mean money in your pocket or money left on the table. Let's examine. In a buyer's market, the buyer must be aware that being in a buyer's market does not make the buyer's job any easier. It just gives the buyer more flexibility and options. Remember in a buyer's market, there are several homes for the buyers to choose from. The buyer have the advantage in a buyer's market. If the seller does not know what the competition has that is a little bigger or better than his or her home, then the seller will not be able to sell. In other words, for a seller to be successful in a buyer's market the seller must make sure his or her home is price better than his or her competition and is staged so that the buyer can imagine himself or herself in the home. The seller has an advantage in a seller's market. Due to lack of competition, the seller often prices his or her home higher in a seller's market with the hope that the seller can negotiate the price down to where the seller is comfortable. Sorry buyers. If the buyer really wants a home in a seller's market, the buyer must succumb to the seller's terms in order to get the home. As a matter of fact, in a seller's market the inventory of homes for sale that may meet the buyer's criteria are fewer. Why do you need to know what you want in your home? It is important in a word to eliminate or limit competition. If the buyer knows what they desire in his or her new home sooner in the buying process the buyer can narrow the search criteria and bid on the property of choice instead of witness the home being purchase by someone else. In addition, only you as the buyer know exact what features you want in your new home. You, as the buyer know if your family needs three or four bedrooms one or two bathrooms, but more importantly you know what you can afford. Affordability is the next most important criteria that a first time homebuyer must consider. Well, the reason is that your pre-approval letter has a different meaning than you think. The pre-approval is determine by your income to debt ratio true enough; however, are you aware that all your debt is not considered? What debt you ask? The debt that I am referring to is the light bill, water bill, phone bill, grocery bill, cable bill, clothing bill, etc. It depends on where you live. Now the latter statements puts the pre-approval letter into a new prospect doesn't it? Don't get discourage. Just do your homework. Buy where you are already comfortable and be patience. With the present market being a buyer's market, you will find a home that is in that comfortable range in no time. For instance, if you can enjoy life and drive the car you want, eat out when you want at $800.00 in rent, then look for a home where the mortgage payment with principal, interest, taxes, and homeowner's insurance is at or near $800.00. Next, you must determine what type of loan you have an adjustable rate, a fixed rate. The difference is that the adjustable rate will do what adjust and a lot of time it is not down, but up. If you choice the adjustable rate, find out what the maximum rate is and determine whether you can afford the adjustment. The mortgage and your realtor can show the difference in payment. The fixed rate is just that fix. The rate will stay the same for the life of the loan. Lastly, know what you can handle includes not only the mortgage payment, but the now new responsible of maintenance of the property. It is recommended that the buyer have an inspection of the home. The home inspection is a detail report prepared by a licensed professional to give the buyer the condition of the home to include the condition of the roof, electric, plumbing, etc. With the home inspection, you will get a detail report of the condition of the home, and it may include all items that may need deferred maintenance. Deferred maintenance is the buyer's responsible. Do your research before buying your first home, so it does not turn into disaster because you were not prepared.
Article Source: http://www.a1-articledirectory.com
Serena Brown is owner and broker of Taylor-Brown Real Estate. Serena Brown has been serving Northwest Indiana and Chicagoland for over ten years as a real estate professional. She has a successful blog at www.taylorbrownrealestatetalks.com Serena has two degrees. She has written two books.
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