Tips for Home Buyers

• Financial & Credit Prep:

1. Prepare your down payment:
   Sellers generally view buyers willing to place higher down payments as candidates that are more likely to reach a closing.
2. Prepare your W2's + Bank statements:
   Lenders generally look at all applicant's income and bank statements. Expect to show tax returns for a year or more, and gather an W2s or 1099s used to verify income. Sales and commission based applicants are often asked to show more proof of income.
3. Give your credit scores a tune-up:
   Better credit scores mean lower rates which will increase your buying power. Challenge any disputes and understand how opening new lines of credit may negatively impact your credit score. Especially resist the urge to open new credit in the time period between offer acceptance and closing Lenders generally pull your credit one final time on the day of, or day before you close.
4. Pay an Increased Rate vs Paying Points?
   Lenders can lower your interest rate if you pay up points, or fees due at closing. If you choose points, be careful not to constrain your cash reserves at the expense of your down payment or other closing costs. A good lender can help you see the cost/benefit to each scenario.
5. Pre-Qualify vs Pre-Approved:
   Understand the difference between these two letters. Sellers often will ask to see your Pre-Approved letter accompanying any offer that requires financing. Have your Pre-Approval letter ready to accompany offers, and in conditions where interest rates rise, ask for a rate-lock that can span the time it takes to find the home as well as closing. Pre-qualification letters are often not accepted by sellers and often don't require a review of your financial situation.
6. What can I afford?:
   An affordability calculator and a mortgage calculator can help your understand your financial picture as a homeowner.

• Make Your Real Estate Goals a Reality

1. Choose the Right Agent:
   Understanding the home buying process can still challenge seasoned home buyers, so it's understandable how daunting it may feel to the first time home buyer. Each transaction can present new challenges. Finding an agent that is well-rounded, attentive to your needs and good communication skills. Like most professions interview multiple candidates, prospective home buyers should take time to speak to a few agents to see which person suits your needs best. For a vast majority of people, their real estate transactions will be the largest transactions of their lives. Be weary of an agent that seems to know all the answers to your questions off the cuff. Townships, Counties often differ in their rules and regulations, and your agent has the responsibility to provide you with accurate information.
2. Understand the Basics of your home buying process:
   Like a trip's itinerary, your agent should help you understand each major step of the process and what, if any, you will be asked to provide in terms of information or fees for inspections, etc. Make sure to save enough for inspection fees, closing costs, and mortgage title insurance policy (if not rolled into the loan).
3. Discuss some hypothetical tough scenarios:
   Mentally preparing for a scenario such as a multiple offer situations or bidding wars is never pleasant. Having general conversations with your agent about these situations before you are in them, will make sure you are on the same page. Most transactions have few to zero issues, but it is helpful to discuss general strategy should a complexity occur.
4. Buy tomorrow's home on today's budget:
   Take some time to envision what your real estate needs may be over the next few years. Try to balance those future needs and wants, yet be disciplined to stay within your budget. Try to differentiate the needs from the wants, and evaluate properties against that matrix when viewing homes.
5. Be Informed about the Neighborhood and Schools:
   In most situations, buyers have the time to check out the surrounding homes or drive by the prospective home's schools. For buyers with school-aged children, most principals will schedule a walk-through for prospective buyers. If market conditions move a little faster than you are comfortable, work with your agent to do some general research on some of your targeted areas so that your home buying decision never feels hurried.