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10 Tips to Making
the American Dream Come True
Step #1 - Ask Your Lender About Available
Mortgage Programs: An experienced mortgage
company should be able to work with you one-on-one
to determine exactly which mortgage programs will
meet your individual needs and what you can qualify
for based on your personal information. Applicants
with higher credit ratings and/or higher levels of
financial reserves generally receive more
competitive mortgage rates. But with hundreds of
available mortgage programs, there is usually one to
meet the needs of almost any homebuyer.
Step #2 - Research the Terms of the Mortgage:
Different mortgage lenders have varying price
structures that can affect the amount that you pay
for your home. An annual percentage rate (APR)
includes the actual interest rate on the loan, as
well as certain fees and costs associated with the
loan. Because a customer may be paying points and
other closing costs, the APR disclosed may appear to
be higher than the actual interest rate quoted for
the loan. Not all lenders calculate APR identically;
however, it does give customers a relatively fair
method of comparing price on their potential loans.
Step #3 - Get a Pre-Qualified Loan Commitment:
Even before the house hunting begins, homebuyers
need to determine how much they can afford. Mortgage
companies or other lending institutions provide
pre-qualified loan commitments. Sellers often don't
take an offer seriously unless the prospective
first-time buyer has some assurance of
creditworthiness from a mortgage company. Shopping
for a home with a pre-approved mortgage enables a
customer to negotiate as a cash buyer and submit an
offer on a home with confidence that the mortgage
will be issued and the sale will be completed.
Step #4 - Do Your "Home-work": Be sure to go
online to sites such as
coloradohomes.com to check for listings,
neighborhood information, current mortgage
information and home ownership services. The right
amount of research will help you to better
understand the marketplace and homes available in
your price range when you're ready to work with a
real estate professional.
Step #5 - Make a Checklist: To help make the
home buying process a little easier, homebuyers
should create a checklist of the important features
they want in a home. Location and the number of
bedrooms and bathrooms are usually important. Other
important questions to answer: What will the commute
to work be like? Are there shopping centers, parks,
and schools located near the home?
Step #6 - Find a Buyer's Broker: A buyer's
broker or agent represents the buyer's interests and
helps identify homes that are for sale and in the
right price range. The broker also can help with
such tasks as writing contracts, negotiating the
asking price, and closing the purchase.
Step #7 - Make an Offer: Once you find the
right house, make an offer. Make sure that your
offer is contingent on two items: 1) You're able to
obtain adequate financing (if you haven't done so
already), and 2) you can pull out if the property
doesn't pass the home inspection, and the owner
can't come to terms about how to fix the problem. Be
prepared for counter-offers from other buyers and
some negotiation with the seller. Make an earnest
money deposit, which is a check that you'll give
your agent to indicate that you're serious about
buying the house. The check will apply toward the
sales price if the deal goes through; if not, you
get it back. You should also set a time limit with
your agent that the offer you've made is good for
three days. If an offer is accepted, it goes to the
contract phase.
Step #8 - Hire A Home Inspector: Making an
offer contingent on an inspection by a registered
home inspector can save thousands of dollars by
avoiding unseen problems. Inspectors will check the
house for any structural damage. In the contract
with the seller, it should state any necessary
repairs that must be made before closing on the
house. Prior to closing, walk through the house and
check that such repairs have been completed.
Step #9 - Buy Homeowners Insurance: Lenders
require homeowners insurance to protect the new
homebuyer's interests as well as their own. There
are many providers so shop around for the best
rates.
Step #10 - The Closing: This is where the
seller and buyer sign settlement-closing papers to
transfer the ownership of the home and all
transactions are finalized. Congratulations, you
achieved the American dream and you are now a
homeowner!
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