Home Ownership 101

Home Ownership 101 Phyllis Borchardt, REALTOR ® (623) 521-0790 [email_address]

14 HOME PURCHASE PROCESS
Prepare for homeownership
Evaluate pros and cons
Learn about the process
Homebuyer education
Individual counseling
Determine how much you can afford
Prepare a realistic budget
Get loan pre-approval
Select a lender
Apply before you shop for a home
Decide on type of house you want/need
Affordability, size, lifestyle
Shop for a home
Real estate agent
Make an offer
Purchase contract
Earnest money
Apply for a mortgage
Shop for best terms/rate
Complete application
Get a home inspection
Buy insurance and get
additional inspections
Title insurance
Close the loan
Sign closing documents
Seller receives check
Buyer receives keys

Buying a home
One of your most significant investments in life.
Not only are you choosing your dwelling place, and the place in which you will bring up your family, you are most likely investing a large portion of your assets into this venture.
The more prepared you are at the outset, the less overwhelming and chaotic the buying process will be.
The goal of these pages is to provide you with detailed information to assist you in making an intelligent and informed decision.
Remember, if you have any questions about the process, I'm only a phone call or email away!

Benefits of Owning Your Own Home
The Best Investment
Income Tax Savings
Stable Monthly Housing Costs
Forced Savings
Freedom and Individuality
More Space

Important Things To Avoid Before Buying a Home
Don't Move Money Around
The Effect of Changing Jobs
No Major Purchases of Any Kind

Don't Buy a Car - or Did You Already Buy One?
When Income Grows and You Want to “Buy Stuff"
Debt-to-Income Ratios and Car Payments
How Buying a Car Reduces Your Purchase Price

Obtaining Your Credit Report & FICO Score
EXPERIAN
P.O. Box 2002
Allen, TX 75013
1-888-397-3742
www.experian.com
TRANSUNION
Consumer Disclosure Center
P.O.Box 1000
Chester, PA 19022
1-800-916-8800
www.transunion.com
EQUIFAX P.O. Box 740241 Atlanta, GA 30374 1-800-685-1111 www.equifax.com

Correcting Any Errors on Your Credit Report
Follow any instructions on how to correct errors
Call the credit reporting agency
Send any additional information needed to correct the error
Explain the problem in a brief letter
Contact the creditor directly
Write a consumer statement to tell your side of the story

Improving Your Credit Score
Correct any inaccurate information
Pay your bills on time
Reduce outstanding debt
Apply for and open new credit accounts only
as needed
Use credit cards responsibly
Re-establish credit if you have had problems

What if You Don’t Have Credit?
Nontraditional Credit Report
May be needed if you
do not use banks or credit cards
have insufficient number of credit references to develop traditional credit report
Generally prepared by credit bureau or lender
Borrower must provide a list of
credit sources for all regular, periodic payments
Borrower must produce
receipts, copies of canceled checks or money orders, and copies of paid bills.

Nontraditional Credit Report
Type of information do you need to provide:
Housing-related payments
rent, utilities, phone and cable television
Insurance-related payments
excluding payroll deductions
including coverage for medical, automobile and life
Payments to merchants and health and child-care providers;
tuition and loans obtained

The Business Cycle and Buying a Home
Recession and Expansion
Supply and Demand
Should You Try to "Time the Market"?

Comparable Sales and Your Offer Price
Determining Your Offer Price
Comparable Sales in the Public Record
Comparable Sales in the Multiple Listing Service
Comparable Sales - Pending Transactions
Other Factors Influencing Your Offer Price

Major Factors Influencing your Offer Price
How Property Condition Affects Your Offer
How Home Improvements Affect Your Offer
How Market Conditions Affect Your Offer
How Seller Motivation Affects Your Offer
The Final Decision on Your Offer Price

Offering to Purchase Real Estate- the Basics
Introduction and Overview
Contingencies in a Purchase Offer
Earnest Money Deposit
The Closing Date
Transfer of Possession (recording)

Writing an Offer - Safeguards Regarding the Property
Disclosures From the Seller
Condition of the Property Upon Transfer
Inspections You Should Require
Final Walk-Through Inspection

How Financing Details Affect Your Offer
Down Payment
Interest Rates
Closing Costs and Financing Incentives
Seller Financing
Cash Offers
Other Financing Details in Your Offer

First Time Homebuyers Down payment Assistance programs
First time homebuyer defined as not having owned a home in past three (3) years.
Funding available varies community to community
Funding can be used for downpayment & closing costs
Income guidelines
Forgivable loan provided homeowner is an owner/occupant for time period specified in program

How FHA and VA Financing Affects Your Offer
Back in vogue, today FHA financing provides opportunities for home buyers in current market conditions.
VA financing offers our military personnel past and present an opportunity to finance their first home today and in the future .
Extra Costs for the Seller
VA and FHA Appraisals

Selecting Service Providers
You and the Seller Must Agree
Escrow and Settlement
Today’s REO/Short Sale properties typically have a seller specified Escrow/Closing service
Title Insurance
Home Inspection & related inspections
Termite and Pest Inspection

Home Ownership 101

by Phyllisdb on Dec 23, 2009

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Home Ownership 101 — Presentation Transcript