Are you looking into what it takes to buy your first home in Cleveland Ohio? Not sure where to begin?
Let me point you in the right direction, so your goals of home ownership may be attained!
The first step in home ownership starts with your understanding of what’s involved in the process of making your purchase. Unless you have the entire amount of money saved up to buy your first home, you will need to get a home loan. With that most likely being the case, your credit score is an extremely important factor along with consistent pay from stable employment.
Most first time homebuyers want to just start looking at homes right away. It’s understandable. But, you must first know what your price limits are. You must first know what you can and cannot afford – before you set out to see what’s out there! Meet with a lender FIRST! Understand that your monthly mortgage payment will be made up of the amortized principal amount, the interest rate charged on your loan, the property taxes, and the insurance premiums (aka “P.I.T.I.”). In addition to that, if you are looking to live in a condo, a cluster home, or a town home, then you will also have maintenance fees thrown into the mix! Be comfortable with that total amount in your monthly budget!
In meeting with a reputable lender with whom you will discuss the various aspects of your loan options, interest rates, etc., you will be sharing with them all of your financial information (income, savings & assets), your social security information, etc. Share any and all information with them, as they will be one of the most important people in your home buying process (besides ME!), and it will allow them to accurately guide you on getting your mortgage. The lender will then pull your credit report to determine your credit worthiness. Right now at the time of this post, the minimum credit score required to pursue an FHA loan is 640. If there are any deficiencies that are in need of immediate attention, a reputable lender should be able to point you in the right direction to getting those items resolved and cleaned up. The outcome of your meeting with the lender should be to obtain a Pre-Approval certificate or letter. And, I cannot stress enough that you should have a REPUTABLE lender do this for you! You want to be certain that when it comes time for you to “close” on your purchase, your lender can actually lend you the money you need! Also, read more about what not to do before closing.
Once you’ve received your Pre-Approval, you are now ready to start shopping for homes! But first, identify what it is you are looking for… and in your desired location. Determine your list of criteria… your “must haves”, “like to haves”, and “do not wants”. Know what you’ll be searching for! Briefly start your “shopping” online. That will give you a general understanding of what you get for the money. Then engage in a REALTOR® (like ME) to help narrow down your search and guide you in your first home purchase. Also, know the types of properties on the market. You can read about the different properties for sale here.
A couple words of caution… Pick just one agent to assist in your home buying experience! You will avoid any confusion, headaches, and hurt feelings in the long run! I suggest that you choose someone that meshes well with your personality, etc. Remember, they will be the conduit to your home purchase! Also, avoid going to Open Houses. Agents (representing the seller) are there to gather as much information about you as they can in order to use it against you in a negotiations if you should want to purchase that home. Instead, schedule private showings of the homes that interest you with your chosen agent… the one who looks out for your best interests and negotiates for you to get you the best possible deal on your purchase. Read more about Open Houses here.
How much will a real estate agent cost you?… Real estate agents are paid after closing from the seller’s net proceeds. In most cases you do NOT pay your agent’s commission, so it makes good sense to enlist an agent (like ME) to help you with your home buying goal! In certain situations though I must mention, namely in some distressed sales, some fees and/or costs may be pushed back onto you based on that particular situation. Just be sure to know what you are getting into if you want to offer on a distressed sale property!
Also, be aware that some agents pass along hidden fees that they or their company charge you. The fees may not be overly apparent and may not even be pointed out, but they are written into paperwork that you must sign. I wrote another post regarding these fees, you can read more about Admin Fees, Broker Fees & Flat Fees here. Rest assured, that I have none of those hidden (junk) fees!
If you would like any additional information, or if you have any specific questions regarding your desire to purchase property, please feel free to contact me by using the form below. If you would like to read what other first time homebuyers have had to say about working with me, please feel free to visit my Testimonials page.