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kimbalina
Bring on the glitter and bows!
Member since 6/08 15158 total posts
Name:
Kim
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Where to start?
DH and I are getting serious about buying our first home in the coming new year. I have NO idea where to start.
We did look once before. Our agent was awful and we are going to be looking for a new agent. I feel like last time was so haphazard and we didn't really get anywhere.
We are looking in middle of Suffolk. I do not want to get any family involved with this process for now, so I was hoping to get some information here!
We were approved a 2 years back for a mortgage with our own bank but I know we would have to go thru that process again. I just want to start getting prepared from what we need for lawyer, RE, down payment cost etc...
Thanks for any tips you may have!
edt: any books, websites, articles you may know of would be helpful also.
Message edited 11/28/2012 3:34:58 PM.
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Posted 11/28/12 3:33 PM  |
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Prudential Douglas Elliman Real Estate
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Re: Where to start?
First, congratulatons on starting the process. It's definitely exciting.
You definitely want to meet with a mortgage lender again to discuss your qualifiations and find out what you can be preapproved for. Since mortgage requirements, as well as your own personal finances, have likely changed a bit in two years, you want to get current information. A good mortgage lender can advise you not only what you can qualify for in terms of a mortgage and overall purchase price, but will also advise you on different loan products and the mortgage process overall. You should also think in terms of monthly payment, not just purchsae price, to find your financial comfort zone. Unless you are paying all cash, purchase price is irrelevant. But you need to think about what you can afford per month, and then work backward to consider what your monthly mortgage payment can be (factoring in down payment, interest rate, any pmi), how much you can afford in property taxes at different price points, and keeping in mind you will also need to pay homeowners' insurance (usually somewhere in the $100-$125/month range).
Aside from the financial piece, you should schedule an appointment with a real estate agent, or a few real estate agents, and interview them as you would if you were going to list your home for sale. A good, professional agent will welcome the chance to sit down with you to discuss your real estate goals, discuss the buying process with you, answer your questions. I like to do an initial buyer consultation before I even show a buyer a house! You can read one of my old blog posts re: the benefits of a buyer consultation, which should be a no-obligation, no pressure meeting:
http://www.lifamilies.com/blog/Century%2021%20Dallow%20-%20Christine%20Braun
It's definitely smart to get your ducks lined up in a row before you start looking. Aside from meeting with an agent to discuss the process and preparation you can undertake now, you can look online, but keep in mind that many articles are written from a national, general perspective, and real estate is local. So a lot of what is written may not apply to LI real estate (e.g., most places in the country, real estate agents prepare the contract; here, you will have a real estate attorney handle the contract). And there's nothing like sitting in front of a live person having a real-time discussion!
Let me know if you would like to meet with me to discuss your situation. I am based in Nassau, but I work all over Long Island, and would be happy to help, even if just to answer questions!
[email protected] or (516) 587-7618
Good luck!
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| Posted 11/28/12 4:17 PM |
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blustar214
So in love with my little girl
Member since 1/10 2471 total posts
Name:
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Re: Where to start?
You don't need too much info for the lawyer - you just need to know who you are going to go with once you put an offer in on a house. So just get some recs and ballpark fees (generally $800-$1500) for a closing.
As far as agents go, if you don't wind up with a referred RE, then I would suggest looking up one of the people who do a lot of business in the areas you are looking in.
Down payment will be up to you and your budget. You can do an FHA loan with 3.5% down, or a conventional loan with 5%-20% (or more!).
I don't know much about closing costs except for what we are dealing with now - they are about $12-15k, depending on whether you need to pay any points, etc.
The first thing I suggest you do is pull your credit report and see if there are any surprises. Also get your scores so you can see whether you want to work on improving 1 or both.
Good luck!
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| Posted 11/28/12 4:17 PM |
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Re: Where to start?
Posted by blustar214
The first thing I suggest you do is pull your credit report and see if there are any surprises. Also get your scores so you can see whether you want to work on improving 1 or both.
Good luck!
Credit is an important part of the mortgage qualification picture, but only one component of several that will determine whether you can get a mortgage and for how much. So I wouldn't recommend pulling your credit yourself. Any mortgage lender you meet with will run your credit report before preapproving you, and the credit report they get is often different than the ones consumers can access online. So since the mortgage professional will do it anyway, why go through the extra step of doing it yourself?
Also, the credit info you get yourself may not mean much to you. Different loan programs have different credit requirements, and different lenders impose their own requirements over that. So your credit needs to be viewed in context. Also, the score isn't the only thing reviewed. Someone with a 700 credit score may have a problem if they have had recent late or missed payments, but someone with a lower score could be fine, especially for an FHA loan, if their recent credit history is good. A mortgage loan officer can review your whole credit report and advise you on whether anything on it needs to be cleaned up before you can proceed,
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| Posted 11/28/12 5:44 PM |
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blustar214
So in love with my little girl
Member since 1/10 2471 total posts
Name:
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Re: Where to start?
Posted by Century 21 Dallow - Christine Braun
Posted by blustar214
The first thing I suggest you do is pull your credit report and see if there are any surprises. Also get your scores so you can see whether you want to work on improving 1 or both.
Good luck!
Credit is an important part of the mortgage qualification picture, but only one component of several that will determine whether you can get a mortgage and for how much. So I wouldn't recommend pulling your credit yourself. Any mortgage lender you meet with will run your credit report before preapproving you, and the credit report they get is often different than the ones consumers can access online. So since the mortgage professional will do it anyway, why go through the extra step of doing it yourself?
Also, the credit info you get yourself may not mean much to you. Different loan programs have different credit requirements, and different lenders impose their own requirements over that. So your credit needs to be viewed in context. Also, the score isn't the only thing reviewed. Someone with a 700 credit score may have a problem if they have had recent late or missed payments, but someone with a lower score could be fine, especially for an FHA loan, if their recent credit history is good. A mortgage loan officer can review your whole credit report and advise you on whether anything on it needs to be cleaned up before you can proceed,
When we started looking for homes the first thing we did was go to a lender and see what we would qualify for in terms of monthly payments. They pulled our credit. Our credit is very good, but since DH"s score is lower than mine we would have had to pay a point at closing (or roll it into the mortgage). I wish that I had pulled our credit reports much and then then did what I could do to raise the scores. The credit counseling people gave me a list of all the different components that go into your score and one of them was credit utilization rate (which I'm sure we all know about!). DH had 2 cards in his name only that have 0% interest, but since the utilization rates were high on those cards it was impacting his score. It was an easy fix - we just paid them down to a 30% utilization rate and his score has increased 20 points, which means that we now won't be paying as much at closing.
So those are the kinds of things I would suggest doing at an early stage. This is just my layperson opinion, but if I had pulled our credit report earlier and been more aware of the factors that make up your credit score, there are steps I could have taken to improve our scores.
If you have any negative information on your credit report you can also dispute that by sending a letter to the credit reporting agency. I think that the agency then has the burden of reaching out to the company that put the negative info on your report and if that company doesn't respond within a certain time period it is automatically removed from your report.
ETA: I would also take stock of your monthly payments for different things because if you can lower them or get rid of them before the bank runs your credit you will be qualified for a higher mortgage.
For instance, if you have a car loan that is almost finished, but it costs you $300/month, that lowers the amount you will be qualified to borrow - and $300/month translates into a lot of extra mortgage money. So if you only have 6 months left on that loan you can pay that off and then qualify for more.
Like Christine says, the mortgage lender will go over everything on your credit report with you and discuss how much you will be qualified for in terms of monthly payments.
At the bank we are using your credit report is good for 90 days. If you don't close within that time frame they need to pull your credit again.
Message edited 11/28/2012 6:48:24 PM.
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| Posted 11/28/12 6:43 PM |
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Re: Where to start?
I totally agree with looking at your credit early on... Very good advice from blustar214!
I just think there's no harm in meeting with a lender early to discuss these things and get their input to eliminate some of the guesswork. There's really no downside to consulting a mortgage pro early... There is no commitment associated with a preapproval, you can always change lenders, get an updated one, etc. they can put your credit info, and other financial information, in context.
The bottom line is you want to assemble a good team of real estate experts who can guide you through the various aspects of the purchase. And it's much better to do that early than have to scramble later and possibly encounter unpleasant surprises.
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| Posted 11/28/12 8:00 PM |
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Beth
The Key to your new home....
Member since 2/06 24849 total posts
Name:
Beth
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Re: Where to start?
As a realtor and first time buyer I first started with looking at my own credit
I noticed a few things that needed to be fixed- and I am working on that
next I spoke to a lender- I know a few good ones :)
he gave me real world numbers- I think this is the most important part- how much is a $350K house with $8K in taxes going to cost PER MONTH-
are you ok with that number?- if not- we need to adjust
I work and live in Suffolk if you would like any help- feel free to FM me- I would be happy to help you!
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| Posted 11/29/12 2:27 PM |
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kimbalina
Bring on the glitter and bows!
Member since 6/08 15158 total posts
Name:
Kim
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Re: Where to start?
Thank you all for the information.
I am going to start with the credit report and getting our taxes done after the new year.
Thank you to Beth and Christine for the realtor information. You might hear from me soon! LOL
If we work with a realtor do you guys usually have Lawyers that we can work with if we don't have one of our own, or is that something we should definitely find on our own?
THANK YOU!
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| Posted 12/4/12 3:20 PM |
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kimbalina
Bring on the glitter and bows!
Member since 6/08 15158 total posts
Name:
Kim
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Re: Where to start?
Thanks Bluestar also. That is a lot of great information!
I appreciate the time you took to write it all out!
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| Posted 12/4/12 3:23 PM |
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Re: Where to start?
Great! Sounds like you have a plan.
As far as the lawyers - I do have lawyers that I work with frequently (and who've worked with my clients) who I recommend to new clients. Most experienced agents can recommend other types of real estate agents as needed.
Btw - one of the attorneys I highly recommend is Kristen Breglio, who is also a vendor on this site. She is very thorough and makes herself accessible to her clients to answser questions. She is great at explaining each step of the process, so I think she is especially a good fit for first time buyers. Her contact information is on this site, so you may want to consider her!
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| Posted 12/4/12 3:24 PM |
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sunnyplus3
:)
Member since 11/05 8749 total posts
Name:
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Re: Where to start?
I'm not sure if you are set on location yet but my advice would be to pick an area or areas within your price range then look at details like school district/taxes, commute times and close in on specific neighborhoods or hamlets that meet your criteria. Once you've narrowed it down visit that area at different days and times. Eat in local places, shop in the stores, visit the library.
Every homebuyer has their own "ideal home" to me finding a community that felt like home was really important. We also found that a few areas known as being "desirable" just weren't a good fit for us from a commuting standpoint or whatever. once we found our target neighborhood we looked at literally every house for sale in it with a realtor until we found our house LOL
Sorry you got off to a bad start with your last realtor, I'm sure you would be in excellent hands with Beth or Christine!
Good luck!
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| Posted 12/4/12 4:10 PM |
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