Please browse our articles on buying smart, making your move as smooth as possible, and finding the right agent to guide you through your transaction. You’re also welcome to read the Buying Tips archives of our blog for timely topics and advice.
1. They don’t ask enough questions of their lender and miss out on the best deal. 2. They don’t act quickly enough to make a decision and someone else buys the house. (Yes, this can even happen in a ‘Buyer’s Market’.) 3. They don’t find the right real estate professional who will give them good advice throughout the home-buying process. 4. They don’t do enough to make their offer look good to a seller. 5. They don’t think about resale before they buy. The shorter the time span you end up staying in your first home, the more critical this becomes.
Credit scores range between 200 and 800. Scores above 620 are considered desirable for obtaining a mortgage. These factors will affect your score. 1. Your payment history. Whether you paid credit card obligations on time. 2. How much you owe. Owing a great deal of money on numerous accounts can indicate that you are overextended. 3. The length of your credit history. In general, the longer the better. 4. How much new credit you have. New credit, either installment payments or new credit cards, are considered more risky, even if you pay promptly. 5. The types of credit you use. Generally, it’s desirable to have more than one type of credit installment loans, credit cards, and a mortgage, for example. For more on evaluating and understanding your credit score, go to http://www.myfico.com
Credit scores, along with your overall income and debt, are a big factor in determining if you’ll qualify for a loan and what loan terms you’ll be able to qualify for. 1. Check for and correct errors in your credit report. Mistakes happen, and you could be paying for someone else’s poor financial management. 2. Pay down credit card bills. If possible, pay off the entire balance every month. However, transferring credit card debt from one card to another could lower your score. 3. Don’t charge your credit cards to the maximum limit. 4. Wait 12 months after credit difficulties to apply for a mortgage. You’re penalized less for problems after a year. 5. Don’t purchase big-ticket items for your new home on credit cards until after the loan is approved. The amounts will add to your debt. 6. Don’t open new credit card accounts before applying for a mortgage. Having too much available credit can lower your score. 7. Shop for mortgage rates all at once. Too many credit applications can lower your score, but multiple inquiries from the same type of lender are counted as one inquiry if submitted over a short period of time. 8. Avoid finance companies. Even if you pay the loan on time, the interest is high and it will probably be considered a sign of poor credit management. This information is copyrighted by the Fannie Mae Foundation and is used with permission of the Fannie Mae Foundation. To obtain a complete copy of the publication, Knowing and Understanding Your Credit, visit http://www.homebuyingguide.org The neighborhood you choose can have a big impact on your lifestyle safety, available amenities, and convenience all play their part. 1. Make a list of the activities movies, health club, church you engage in regularly and stores you visit frequently. See how far you would have to travel from each neighborhood you’re considering to engaging in your most common activities. 2. Check out the school district. The Department of Education in your town can probably provide information on test scores, class size, percentage of students who attend college, and special enrichment programs. If you have school-age children, also consider paying a visit to schools in the neighborhoods you’re considering. Even if you don’t have children, a house in a good school district will be easier to sell in the future. 3. Find out if the neighborhood is safe. Ask the police department for neighborhood crime statistics. Consider not only the number of crimes but also the type burglaries, armed robberies and the trend of increasing or decreasing crime. Also, is crime centered in only one part of the neighborhood, such as near a retail area? 4. Determine if the neighborhood is economically stable. Check with your local city economic development office to see if income and property values in the neighborhood are stable or rising. What is the percentage of homes to apartments? Apartments don’t necessarily diminish value, but they do mean a more transient population. Do you see vacant businesses or homes that have been for sale for months? 5. See if you’ll make money. Ask a local REALTOR or call the local REALTOR association to get information about price appreciation trends in the neighborhood. Although past performance is no guarantee of future results, this information may give you a sense of how good an investment your home will be. A REALTOR or the government planning agency also may be able to tell you about planned developments or other changes in the neighborhood like a new school or highway that might affect value. 6. See for yourself. Once you’ve narrowed your focus to two or three neighborhoods, go there, and walk around. Are homes tidy and well maintained? Are streets quiet? Pick a warm day if you can and chat with people working or playing outside. Are they friendly? Are their children to play with your family?
