Fixed Rate
Adjustable Rate
Blend Loans
Veterans Loans
FHA Loans
2 Step Loans
Balloon Loans
Bridge Loans
Sub Par Credit
Fixed vs. Adjustable
Points vs. No Points
Why Choose an Arm?
No Points/No Closing Costs
15 vs. 30 Year Term
30 vs. 15 Year Term
When to Purchase
Your Professionals
Selecting a Home
Your Loan Options
Completing the Process

Selecting Your Home

Step 4 of 6

Everyone who has thought about buying a home knows the price of identical houses will vary from town to town and state to state (remember "location, location, location"). Buyers must decide what is more important the location or size of the home.

Why were you advised to choose your professionals prior to choosing where and what you will buy?

Both your Mortgage Professional and your Real Estate Professional can play a key role in helping determine where you will live and what you will live in.

The Real Estate Professional will be able to review what is available in your desired towns and what the purchase price ranges are for the various homes. The main role of a Mortgage Officer is to help you buy your dream home. A good Mortgage Officer will take that one step further. He/she will ask you what the ideal home purchase is for you and make that purchase a reality. Each home buyer will be motivated by different goals and desires and therefore will have different priorities when it comes to purchasing a home.

Where Will You Live and What Will You Live In?
If your Mortgage Professional is able to pre-qualify you for your dream house in the desired location great!, you are ready to proceed to the next step.

If not your Loan Officer will be able to talk with you about your options, review different purchasing strategies, and help you obtain the loan. Armed with your financial qualifications your Loan Officer will help you review options and help you prioritize what is more important location or home type.

Picture the Scales of Justice;

In this case one plate will represent the town and one plate will represent the style or type of home you will buy. Each buyer must find that balance before they start looking for a home.

If location is your priority

If you are willing to trade the size or style of home for location then you will focus on a particular town or neighborhood. Once you have your pre-qualification and know your purchase price you can focus on what style or type of home you can afford. Styles of housing include condominium, cooperatives, town houses, multi-family home and single family homes.

If Style is your priority

If the type of home you live in is a greater priority than where you live then your house hunt will take a little more research, you will need to find the town and location were you can purchase your dream home.

Armed with your purchase price you must know research the towns within your acceptable geographical area and find one that will offer suitable homes in yuor price range.

Examples of questions to ask yourself:

Do I really want that 4th bedroom and commute the extra 20 minutes?

Are you willing to give up the size of the yard for a shorter commute to work?

Once these questions are answered you will have determined what style of house you will be purchasing and you are ready to go out and find your home.

Research will be the key to your house hunt. Since you are not locked into a town make sure you examine all the acceptable towns. Work with your Realtor(s) to find your new home making sure to investigate things like taxes, zoning, schools and anything else that may effect the purchase or future sale of the home.

When you do finally find a home and begin the purchase process make sure that you never sign anything without having a lawyer review it first. This purchase will be the biggest of your life and is likely to involve your life savings so do not cut costs and try to save a few hundred dollars by entering into an agreement on your own.
Rarely does someone buy the first property they see, in most cases buyers look at anywhere from 10-50 homes before settling on one. After reviewing 10 or more homes your priorities, needs, and wants will become clear. You will not need to ask friend, family or your Real Estate and Mortgage professionals if your getting a good deal. Only you know what you want and what your willing to trade off on to get it, you become the expert. You will know what is overpriced, what is under-priced and whether the circumstances require and timely offer. At this stage in your house hunt you should not be influenced by your broker or anyone, remember, most people involved are paid when the transaction closes so they have an financial interest in your purchasing the home. When you see a home, its what you want, and its priced right for you, only then should you put in an offer.

The Inspection Process.
Once you have found a property the next step is obtaining an inspection on the property. Many people question the importance of an inspection or don't pay much attention to it. The inspection is extremely important, there are many items in it that could effect your purchasing the property. For a cost of $250-$500 you could potentially save yourself many thousands of dollars.

In a worst case the inspection may bring to light problems with the house or show that it is damaged in a way that makes it unsuitable for you to live in. Examples include things like termite damage or structural damage.

In many cases the inspector finds only minor imperfections with the property. This information will at least educate and prepare you for additional expenses you will incur.

Serious issues may also arise, issues that might not kill the deal but issues that may lead to further negotiations. Two frequent examples of this type of problem are a home that needs a new roof or a new septic system. In each case it is customary to split the cost with the seller by reducing the purchase price by the sellers share. Other negotiations might include the sellers making repairs prior to closing.
Once you have found a property that meets your approval you will be ready to complete the home purchasing process and buy it!

Next Chapter


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