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- Answering the eternal question: to rent or to own
- I have attended plenty of real estate seminars that extoll the
benefits of home ownership as a means of wealth creation, as a
means of personal fulfilment and expression, and as a means of
getting a bigger tax deduction. These are good arguments but this
is a personal financial decision. (Read
on).
- Figuring out how much house you can afford
- Based on their years of experience, financial institutions have
developed a reliable system to calculate what share of your income
should go towards your mortgage payment. An easy way to calculate
how expensive a house you can afford without putting yourself
into extreme financial strain is to use an online calculator such
as Hugh Chou's "How
much house can you afford?" calculator.
- Figuring out how much house you need
- An interesting twist to the previous question. There are those
who argue that you should buy the most expensive house you can
afford because your income is likely go up than down and the 6%
annual appreciation of a $500,000 home is five times more than
the 6% annual appreciation of a $100,000 home. In terms of financial
returns, the more expensive the better. But in terms of the quality
of our lives, perhaps it is worth asking how much house we really
need, don't you think?
- Getting pre-approved by a financial institution
- You will save a great deal of time if you know the price range
you can afford. Many sellers do not accept an offer without pre-approval
documentation. So go to a lending institution and get yourself
pre-approved before you set out looking for a home (read
on).
- Visit open houses
- Pick up the Sunday Kalamazoo Gazette and go through the 'Home
Life' section. You will see page after page of open house ads.
You can also search for open houses that fit your criteria from
South
Western Michigan Regional Information Center. Going to open
houses give you an idea of what is out there. You get feel for
various neighborhoods, archetectural styles, floor plans, and
options. It will help you decide where you want live in what type
of house.
- Select a realtor to represent you
- At this stage in the home hunting process, it is wise to choose
a realtor to represent you. Afterall, it doesn't cost you a dime
to get the services of a realtor. Realtor commission is a percentage
of the sale price which is determined by the contract between
the seller and the seller's agent. Buyer's agents get a portion
of that commission when a sale is completed. (read
on).
- Working with your agent to find your dream home
- The best thing about having a buyer's agent is that you don't
have to wait for an open house. You know that only a very small
percentage of houses on the market are open on any given Sunday.
You can get information about any house in the market and view
them on any day of the week with help of your realtor (read
on).
- Making an offer
- When you have found a perfect home, the next step is to move
quickly to make an offer. Well kept homes that show well and priced
right catch the attentiion of many buyers. Hence it is necessary
to move quickly. Inform your agent immediately that you are ready
to make an offer. Your agent will at once inform the listing agent
that an offer is forthcoming (read
on).
- Dealing with counter offers
- Sellers want the best price for the house - listing price. Buyers
want the best deal - the offered price. Somewhere in the middle
is the fair price that both seller and buyer can agree on. If
your offer is the only that the seller has and if it is not a
ridiculously low offer, you are likely to get a counter offer
(read on).
- Applying for mortgage
- One of the first things to be done as soon as the offer has
been accepted is to apply for a mortgage loan. You can go back
to the institution that provided you with pre-approval or your
realtor or search for another lender. (read
on).
- Arranging for home inspections
- The next thing to do is to get the house inspected by a licensed
home inspector. There is often a deadline for completing inspections
- usually within ten days of the seller accepting the offer. Your
agent can help you arrange for the inspection (read
on).
- Final preparations for closing the sale
- After the negotiations that follow home inspections if the buyer
and seller can finally reach an agreement and sign off to that
effect, you finally have a purchase agreement in hand. Now you
can start the preparations for the closing of the sale. (read
on).
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©
Gracie Kayany, Keller Williams Realty, 8175 Creekside Drive, Suite #100, Portage, MI 49024