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Tell the World I’m Coming Home- How to Turn Your Dreams of Home Ownership into a Reality

September 15, 2011

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So you want to buy a home. Great! You want the white picket fence, a yard for your kids, a place to call your own. But before you unpack your bags, you need some useful information before you buy a home.

Before you buy a house, you have to ask yourself the Suze Orman question: Can you afford it? Usually a home costs three times your income. Calculate the mortgage, debts, and expenses of a house to figure out the actual cost of the house before you think about buying.  After you make sure you have enough money for the house and extra expenses, contact a real estate agent. A real estate agent will look at houses in your price range, inform you about homes that are new on the market, and give you advice about when to buy.

After the agent helps you find a home in your price range, you should look at not only the house, but the whole neighborhood. Research the schools in the neighborhood if you have school-age children and the safety of the neighborhood as well. Good schools often add value to homes in the neighborhood. Find out about property taxes and other fees for the homes in the neighborhood. Take your time to find just the right house, even if it takes several months.

Once you and the real estate agent have found everything you want in a home, you still need a loan to purchase a home. You should make sure your credit is in good standing before you even apply for a loan.  You usually need to put down 20% as a down payment, but there are exceptions. First-time buyers can apply for an FHA (Federal Housing Administration) loan, where the minimum down payment can be as low as 3%. There are many different types of loans available, such as loans for veterans, and you can hire a mortgage broker to learn about them. Mortgage brokers act as intermediaries between home buyers and lenders, processing paperwork and negotiating between home buyers and banks.

After you get a loan for the house, negotiate with your agent and the seller for a fair price for the home.  The longer the home’s been on the market, the more flexible the seller should be on the price. Get the home inspected by a professional inspector for any needed repairs. If repairs need to be made, renegotiate with the seller to pay for the repairs. It’s a buyer’s market, so the seller should be more flexible to paying additional costs to sell the home.  A foreclosed home is often sold as is and the repairs are made by the buyer. Foreclosed homes also require additional paperwork and conduct a title search to see if they have liens on the home as well.

Once you’ve reached an agreement, the closing on the house can begin and you’re almost a homeowner.  However, there’s still a lot more to do before you close on the home. You have to pay the closing costs on the home-typically a variety of fees by the lender and other people involved with the sale.  The closing costs are usually three to five percent of the loan amount.  Sometimes you can ask the lender to pay the closing costs in exchange for a slightly higher interest rate on the loan. You have to get homeowner’s insurance and title insurance. The homeowner’s insurance protects you in case something happens to the house. The title insurance protects you if someone else claims they own the house. A recent Freddie Mac survey found that interest rates on mortgages will remain low at an average of 4%, so keep your interest close to that rate. Walk through the house one more time to make sure there are no more repairs needed. Hire a lawyer if you can’t understand the paperwork you have to sign. Once you understand and sign all the paperwork-congratulations! You’re a proud home homeowner.

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About century21affiliatedchicago

Century 21 Affiliated-Chicago (“C21AC”) is a full service real estate brokerage firm located in Chicago with a focus on residential and commercial properties. Our agent base and management team includes a wide range of specialties serving customer needs across the ever changing real estate landscape, with expertise in many niches, including REO transactions, investment sales, bulk purchasers and sellers, commercial product and traditional residential transactions. C21AC is part of Century 21 Affiliated (“Affiliated”), a top 5 franchisee in the Century 21 system with over 30 locations across the Midwest and over 32 years of history. C21AC entered the Chicago market in February 2011 to re-launch the Century 21 brand in the downtown area and to bring a proven operating platform to the large and fragmented Chicago real estate market. At Century 21 Affiliated, the customer comes first. Our complete commitment to delivering top-notch customer service to our clients is what distinguishes us from our competitors and makes us such a powerful force in the real estate industry. Specialties Residential Sales, Commercial Sales, Short Sales, Bulk Sales, REO's, Leasing, Business Services

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2 Comments on “Tell the World I’m Coming Home- How to Turn Your Dreams of Home Ownership into a Reality”

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