Friday, May 5, 2017

12 Mortgage Mistakes To Avoid When Buying A Home

One of the most important steps in the home buying process is figuring out the financing. There are dozens of questions frequently asked about mortgages and the mortgage process.

One topic that doesn’t get discussed enough when it comes to home financing are the common mortgage mistakes that are made.  Truth is, there is someone out there right now making a mistake that is likely costing them their opportunity to buy a home.
It’s extremely important that when buying a home, buyers are educated on the most common mortgage mistakes made so they can avoid them at all costs.  Making one of the most common mortgage mistakes can be the difference between a buyer getting approved for a loan or not.

Below you’ll find out 12 of the most common mortgage mistakes made when buying a home.  If you’re thinking about buying a home or are currently in the market, make sure you avoid the following 12 mistakes.

1.) Not Using A Local Mortgage Company

One of the first things I discuss with buyers is the importance of understanding that real estate is local.  As a Houston Area real estate agent, I have the ability and experience to help assist Houston area buyers and sellers.  Asking me to help a buyer or seller in San Diego would simply not be fair to the customer or myself.

Just like I’m not able to provide quality real estate advice to a buyer or seller on the other side of the United States, a mortgage lender in Dallas, TX cannot provide quality service either.  One of the biggest mortgage mistakes that is made when buying a home is not selecting a local mortgage company.

There are hundreds of reasons why real estate markets are different and asking a mortgage company located in another city or state to provide quality service isn’t a smart idea.  It’s always suggested when buying a home that you hire a local mortgage company.

If you’re unsure how to find out who the top mortgage lenders are in your area, there are several ways to find out.  One of the best ways to find a top mortgage lender in your area is to ask an experienced and successful local real estate professional.  Top real estate agents in your area will have recommendations to some fantastic mortgage companies.

2.) Getting A Mortgage Pre-Qualification, Not Pre-Approval

Many potential home buyers don’t realize that there’s a difference between a mortgage approval and mortgage pre-qualification, did you?  Not getting a mortgage pre-approval is a huge mistake often made when buying a home.

mortgage pre-qualification sometimes is only as good as the piece of paper that it’s printed on.  A mortgage pre-qualification is often issued by a mortgage lender without doing any research on the potential borrower.  Many times a mortgage pre-qualification is issued based on the information a potential borrower provides to the lender.  It’s optimistic to think that all potential borrowers are going to be 100% honest when attempting to get a pre-qualification, but that’s simply not the case.

Getting a mortgage pre-approval is highly recommended when buying a home for many reasons.  A mortgage pre-approval is issued only after a lender reviews pay stubs, tax returns, credit reports, and other important financial information about a potential borrower.

Top real estate agents will ask for a mortgage pre-approval before showing homes since it greatly improves the chances the buyer is able to secure financing, which is often unknown when only having a mortgage pre-qualification.

Bottom line, not getting a mortgage pre-approval is one of the worst mortgage mistakes made by buyers.  Taking the additional time required to get a mortgage pre-approval and putting forth the extra effort will pay huge dividends when buying a home.

3.) Assuming All Mortgage Products, Lender Rates, & Terms Are The Same

Another mortgage mistake often made by home buyers is believing that all mortgage products, lender rates, and terms are identical.  An important decision that must be made when buying a home is deciding which type of mortgage is the best for your situation.
Is a 15 or 30 year mortgage best? Is a conventional or an FHA mortgage best for you?  Is an adjustable rate mortgage or fixed rate mortgage best?

These are just a few mortgage products that lenders will offer.  Each of these mortgage products will offer different terms as well as rates.  It’s highly recommended that you know how to interview real estate agents when buying a home and it’s no different when deciding on financing.

There are several questions that you should consider asking mortgage companies when shopping around for your home financing.  Below are some of the best ones to ask potential lenders.

    1. Which type of mortgages do you offer?
    2. What are the current rates for each mortgage product?
    3. What are the costs associated with each mortgage product?
    4. What are your credit score requirements for each mortgage product?
    5. Why should I use your company to obtain my home loan?

 Asking these questions maybe difficult for some buyers, but asking them can tell a buyer a lot about the lender.  Buyers who don’t realize there is a difference between mortgage products, each lenders rates, and the terms are potentially costing themselves hundreds of dollars.

4.) Put No Money or Small Amount Of Money Down

There are several mortgage products that allow buyers to purchase a home with no money or a small amount of money down.  While this may sound like a fantastic opportunity, it’s actually one of the most common mortgage mistakes.

Before deciding to purchase a home with no money or a small amount of money down, you need to compare the PROs and CONs of small down payment home loans.

For example, buyers who’re obtaining a home loan that allows no money or a small amount of money down are actually putting themselves at a disadvantage when compared to other buyers in the marketplace.  If a property has multiple offers and one buyer is putting a large amount of money down and one is not, most sellers are likely going to accept the offer with the larger down payment, assuming the majority of the other terms are similar.

Certainly if you’re unable to purchase a home with a large amount of money down, taking advantage of no money or small down payment home loans is a good idea.  There are many buyers that’re capable of putting money down on a home but choose to make this mortgage mistake and put no money down.

Check out this excellent video below which discusses some of the no down payment mortgage mistakes to avoid!

5.) Ignoring Credit History & Score

Credit history and scores have a huge impact on a buyers ability to obtain a home loan and also in determining the mortgage rate.  Ignoring credit history and scores is another common mortgage mistake that’s made when buying a home.

When buying a home, buyers should be aware of their credit history and score.  One of the first steps to getting approved for a mortgage that a lender will take is to pull and review a buyers credit report.  Buyers should be aware of that there are three credit bureaus that’ll be reviewed when getting a mortgage.  The three credit bureaus are Equifax, Transunion, and Experian.  These three credit bureau reports are often put into one clean report often referred to as a Tri-Merge credit report.

Depending on the type of mortgage a buyer is attempting to secure will determine what the minimum credit score requirements are.  In addition, mortgage companies have different guidelines, also referred to as mortgage overlays, which can impact credit score requirements.  For example, many mortgage companies will require a minimum score of 640 but others may allow as low as a 620 credit score, depending upon other circumstances of the buyer.

It’s extremely important when buying a home that buyers are aware of their overall credit picture.  Ignoring credit history and scores is one of the worst mortgage mistakes made by buyers.

6.) Adding Too Much Debt

A surefire way for a buyer to get denied for a mortgage after pre-approval is to add a bunch of extra debt.  Another popular mortgage mistake made by home buyers is adding too much debt.

Ask any experienced real estate agent if they have any horror stories of buyers adding too much debt prior to buying a home and I’m certain you’re going to hear dozens of stories.  As a buyer is navigating through the home buying and mortgage process with the assistance of their Realtor®, one of the most important pieces of advice is to not add any additional debts.

Adding too much debt when going through the mortgage process can mess up a buyers debt-to-income ratios, which ultimately can result in being denied a mortgage.

7.) Skipping The Rate Lock

When a buyer is completing their mortgage application, one of the decisions they’ll have to make is whether to lock in their mortgage rate or not.  Another most common mortgage mistakes that is made when buying a home is skipping the rate lock.

The mortgage rate lock is an agreement made between the lender and the borrower which secures the current prevailing mortgage rate for a specified amount of time.  Mortgage rate locks can vary in time from 7 days to 90 days.

Buyers who commit this common mortgage mistake of skipping the rate lock leave themselves open to some serious risk.  If a buyer decides to float their mortgage interest rate and not lock their rate, they may end up with a much higher rate if rates were to rise.  For example, if a buyer passes on a rate lock at 4.00% and a week later the rates rises to 4.5%, the buyer cannot take advantage of the lower rate of 4.00%.

If a buyers rate lock is expiring and there is still no closing date set, they do have the option to extend their rate lock.  The cost of extending a rate lock will vary from lender to lender.  The lender will want to know why the closing is being delayed and if it looks like it’s only going to be delayed a few days, many lenders will extend the rate lock at no cost to the borrower.

8.) Waiting To Shop For Homeowners Insurance

As mentioned above, shopping around for the best mortgage company and rates is highly recommended.  The same goes for shopping for homeowners insurance.  There are many buyers who make the common mortgage mistake of waiting to shop for homeowners insurance until the last minute.

Whether a buyer is getting homeowners insurance for the first time or the fifth, it’s important to remember that just like interest rates can fluctuate from lender to lender, homeowner insurance rates can fluctuate from one insurance provider to another.

Homeowners insurance will be required for any buyer that’s financing their home purchase, so it’s critical to shop around for homeowners insurance early in the home buying and mortgage process.  Buyers who make the mortgage mistake of waiting to shop for homeowners insurance often delay their own closing because the loan will not be funded until homeowners insurance is purchased and paid for.

9.) Opening Up New Credit Lines

There are many home buyers who believe opening up new credit lines is harmless as long as they don’t run up balances on them.  This is a big misconception and opening up new credit lines is actually one of the most common mortgage mistakes.

Anytime a new credit line is opened up, whether it’s a credit card or a personal loan, a credit inquiry will be made which can impact a borrowers credit scores.  It’s important to find out anytime a new credit line is being opened, whether it’s during the process of buying a home or not, is whether the credit inquiry is going to be a hard or soft inquiry because there is a difference.

Generally speaking, hard inquiries have a larger impact on a borrowers credit score than soft inquiries.  Understanding the difference between hard and soft credit inquiries is suggested, whether buying a home or not.

10.) Neglecting To Consider The Total Costs Of Owning A Home

Owning a home is not as simple as paying the monthly mortgage and waiting until the next months mortgage is due.  Believing that simply paying the mortgage and not considering other costs of owning a home is another common mortgage mistake made when buying a home.

There are actually many costs associated with buying a home.  Before buying a home, it’s vital to understand how much it costs to buy a home.  This includes taking into account the costs of potential repairs, utilities, and other living expenses such as groceries and auto insurance.

There are many mortgage companies who will not explain to a buyer that there are additional costs involved in owning a home.  Buyers who neglect to consider all the costs of owning a home often find themselves in a vulnerable position in the future, especially if they’re buying towards the top of their budget.

11.) Sporadic Job History

One of the most important factors that mortgage companies take into consideration when approving or denying a borrower is their job history.  A buyer that’s had a sporadic job history or that’s had several different jobs over the past couple years may have a difficult time getting a home loan, unless the jobs are in a similar line of work.

Another popular mortgage mistake made when buying a home is having a patchy job history.  Any buyer who is preparing to get approved for a mortgage needs to remember that job stability is vital to getting approved for a home loan.

12.) Not Paying Attention To The Fees Associated With Getting A Mortgage

Last, but certainly not least, not paying attention to all the fees associated with getting a mortgage is another common mortgage mistake.  Mortgage products and rates will vary from lender to lender, as mentioned above, and the same goes for the fees a lender will charge.

Buyers need to ask any potential lender what the costs of getting a mortgage through their company will be.  It’s recommended to have those costs in writing in order to compare companies.

Some of the most common fees that’ll vary from lender to lender include the origination fee, credit report fee, processing fee, and underwriting fee.  These mortgage fees can vary significantly and can potentially cost a buyer a significant amount of money.

Final Thoughts

If you’re thinking about buying a home and you’ll be obtaining a home loan, you must avoid these common mortgage mistakes.  Making one of the above 12 mortgage mistakes will throw a huge wrench into your home buying experience.

If you’re not 100% sure whether or not something will impact your ability to get a mortgage, ask beforehand.  Buyers who decide to make decisions without asking a professional end up being very unhappy, especially if they’re unable to obtain a home loan.

About the authors: The above article "12 Mortgage Mistakes To Avoid When Buying A Home" was written by Andres Jones of the The Jones Team at Realm Real Estate Professionals. With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise.

We service the following Greater Houston areas: Sugar Land, Missouri City, Katy, Cypress, Pearland, Spring, Stafford, Richmond, Rosenberg, Fulshear, Woodlands, Conroe, Humble, Kingwood, Crosby, Baytown, Beaumont, and Galveston, TX.

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Thursday, May 4, 2017

Buying a home usually represents your single biggest investment – and debt.

The home buying process is one of the most exciting, and frequently stressful, experiences you’ll ever go through. This holds true whether you’ve bought many homes or you’re looking to buy your first, whether you’re in the market for a new primary residence, an investment property or that perfect
vacation getaway.

Today’s real estate market can offer more opportunities, yet
 can be filled with more risks than ever before. There are a multitude of factors to consider and decisions to make. When buying, it’s crucial to have all the available resources necessary to make a well-informed decision, together with the time required to make use of them. It’s important to enlist the help of a trusted real estate professional who’ll be able to provide expert guidance at each step of the buying process.
Finding and purchasing a home includes the following steps, which we’ll examine in more detail throughout this booklet:

1.) Define your goals, research your options, make your plans

Given that buying a home is such a big step, it’s very important to educate and prepare yourself as much as possible. This means clearly determining the reasons you’re buying and what kind of home you’re looking for. Since buying and financing a home are so closely related, it also means examining your current financial situation and projecting how much you can afford.
Once you’ve answered these questions, even tentatively, you’ll be in a better position to research housing and mortgage options, and create an action plan and timelines for moving forward. Although it is possible to do this yourself, you may benefit by consulting an experienced real estate professional right from the start.

2.) Contact a real estate professional

Buying real estate is a complex matter with many factors to consider since no two homes or transactions are alike. Moreover, with all the unique opportunities and potential pitfalls of the current market, it’s more important than ever to contact a real estate professional once you’ve decided to buy.
When choosing a real estate professional to guide you through the property search, financing, negotiation and transaction processes, you should consider their local market knowledge, experience, and track record.

3.) Get pre-approved for a loan

We recommend that you get pre-approved for a loan before you start viewing homes with the serious intention of buying. The pre-approval process involves meeting with a lender and authorizing them to examine your current financial situation and credit history. On the basis of this examination, the lender may provide you with a document detailing the amount you can borrow to buy a home. Consider looking online to see what different lenders offer, or contacting your local bank or credit union.

The benefits of pre-approval include:

You’ll know what you are eligible to receive and be able to plan accordingly
. As a qualified, motivated buyer you’ll be taken more seriously when you make an offer Lenders can tell you if you qualify for special programs that will help you afford a better home (particularly if you’re a first-time buyer).
Real estate financing is available from many sources, and an experienced real estate professional will be able to suggest lenders with a history of offering excellent mortgage products and services.
For more information about the benefits of pre-approval and the loan process in general, see -
The Loan Process – Financing Your Home Purchase, on page 14.

4.) View homes and select THE ONE

Simply put, the key to the home search process is knowing what you’re looking for. Among other things, that means distinguishing between “must-haves” and “like-to-haves”. To help you to target your search and define your home preference priorities, this guide includes a Home Search Worksheet on page 23.
That said, here are a few recent facts about the search process that might put your experience in perspective:
92% of buyers use the internet or mobile apps to search for homes. 
The typical buyer searches for 12 weeks and views 12 homes, 2
97% of buyers view real estate agents as important in the home search process.
There are many benefits to starting the search process at a real estate website like®. You can view many homes and their details, take video tours and access neighborhood info.
However, it’s also important to view homes in person. While the property details may seem similar online, homes can be very different in terms of layout, design, workmanship and other aspects. Ideally, you should view homes with the help of an experienced real estate professional who’ll notice things you might miss, provide expert analysis, and act as an impartial sounding board.

5.) Make an offer and negotiate with the seller

Once you’ve found the home you’d like to buy, it’s time to make an offer. Your state or local real estate association likely has contracts that are generally used for transactions in your area. These contracts enable you to specify a sale price and also allow the inclusion of clauses specifying various terms of purchase, such as the closing and possession dates, your deposit amount, and other conditions.
You should carefully review these clauses with your real estate professional to be sure that they accurately express your intended offer. In addition to drawing up the contract, your real estate professional will be happy to address all of your questions about the offer process.*
Once you’ve written the offer, your real estate professional will present it to the seller and/or the seller’s representative. At that point, the process will vary somewhat depending on the market you’re in.
Generally speaking, the seller can accept your offer, reject it, or counter it to initiate the negotiation process.
Successive counter-offers, with deadlines for responding and meeting conditions, may be exchanged between you and the seller until a mutual pending agreement is reached or the negotiations breakdown.
Negotiations involve many factors specifically relating to different market conditions, homes and sellers, some of which are examined in – Successfully Negotiating The Deal – on page 18.

6.) Secure your financing

Once you have a pending agreement, it’s time to return to your chosen lender to finalize mortgage details in order to close the deal. This means finalizing your down payment, interest rate, regular payment schedule and all other financial conditions associated with the closing.

As the saying goes, ‘let the buyer beware’. Unfortunately, too many buyers suffer negative consequences from not fully understanding their financing decisions. Thus, it’s crucial for you to work with people you trust. In this regard, a good real estate professional can become a true friend for life.For more information on the loan process, see – The Loan Process – Financing Your Home Purchase, on page 14.

Close the deal
If you’ve efficiently taken care of everything connected with purchasing your new home, taking ownership should be a positive joy with no surprises. Key steps to the closing, also referred to as the “escrow” or “settlement”, include:

Getting a title search – you will need a historical review of all legal documents relating to ownership of the property – to ensure that there are no claims against the title of the property. It’s also necessary to purchase Title Insurance for protection in the event of errors in the records or mistakes in the review process.

The final walkthrough – you will be given the chance to look at the home one last time to make sure it’s in the same condition as when you signed the sale agreement.

The settlement – typically, on the Closing Date you’ll meet with a lawyer, real estate professional, or escrow agent to verify and sign all the paperwork required to complete the transaction. The settlement will include paying your closing costs, legal fees, property adjustments and transfer taxes. At that point, you’ll receive the property title and copies of all documentation pertaining to the purchase.

Oh, and one more thing – you’ll get the keys!
In most cases, Possession Date will fall within a few days, and you will be able to move into your new home.

Have Questions?

Schedule A Free Buyer Appointment!

Our Selling System

Our Home Selling System

Our innovative Home Selling System was developed to provide our clients with a consistent and proven method to prepare their homes for sale, price their homes appropriately and get the word out to as many prospective buyers as possible.  The benefits of home selling system are a quicker sale at a higher price.

1. Price
The most important step in selling your home is pricing it correctly from the onset.  Its a well known fact that overpriced homes take longer to sell and usually sell for a lower price.  Since the majority of your showings will occur in the first 30 days on the market it is crucial that your initial list price matches buyer expectations.  Our agents are trained to use advanced market analysis software to build a comprehensive report that will accurately determine the optimal list price for your home.  Request a detailed market analysis of your home.

2. Condition
In order to get top dollar for your home you have to make your home look its best.  Our agents are trained to help you identify and prioritize repairs and improvements that will provide the best return on your investment.  Before your home goes on the market, we offer home staging to make every room in your home look its best.

 3. Market
Our Home Selling System was developed to provide our agents with a consistent and proven manner to get our listings in front of as many potential buyers as possible. Our reach is so extensive because we invest heavily in web, social networking, email, direct mail and print campaigns that feature our listings in all the places where buyers are looking. When you hire us to sell your home, we will identify your ideal buyer and then develop and implement a tailored home marketing program designed to reach them. Request a seller specialist today.

 4. Negotiate
Successfully negotiating a real estate contract is more than a matter of luck or natural talent.  When you receive an offer having an agent with a proven track record of bringing buyers and sellers together can make a huge impact on your final sales price.  Our home listing specialists are skilled negotiators who can help you get to the highest price a potential buyer is willing to pay, as well as the best terms, shortest contingencies, fewest repairs and lowest closing costs.  Rather than approaching negotiations from an adversarial winner-take-all perspective, our agents focus on your top priorities and strive to keep emotions from over running the process.

 5. Close
While your home is on the market we will provide at least monthly status reports that show your top prospects, summary of feedback from your showings, a review of completed and planned marketing activities and any recommended adjustments to course.  In order to keep tabs on your competition we setup a neighborhood alert system that will notify you and your agent as similar homes in your neighborhood come on the market, go under contract or sell. Once your home goes under contract we use our sophisticated online transaction management system to make sure the buyers, and their agent, follow through with their contractual obligations in a timely manner.

Have Questions? 

Schedule A Free Seller Appointment!

First Time Home Buyer Tips and Advice

First Time Home Buyer Tips and Advice That Must Be Read!

Whether purchasing a car for the first time, a home for the first time, or anything for that matter for the first time, it can come with much confusion, a high level of uncertainty, and even some stress.  The home buying process is often seen by many as a “daunting” process.  This doesn’t have to be the case though, if the proper preparation and research is done.
Each and every person who purchases a home normally will have different experiences, hurdles to overcome, and ultimately have their own opinion on the home buying process, so beware of many opinions when talking with family, friends, and co-workers.  Even though the majority of home buyers are different, the home buying process is usually the same.  There is a general outline that should be followed when buying a home for the first time.
Here are several first time home buyer tips and some advice to help make the process of purchasing a home for the first time much less stressful and seamless!

How Much Can You Afford

Whether a consumer is purchasing a car for the first time, a home for the first time, or a set of golf clubs for the first time, it’s important to know how much can be afforded!  This is an extremely important part of the home buying process.  Many first time buyers don’t realize or understand that it’s extremely important to know how much they can afford before looking at homes!  It’s common to have first time home buyers contact real estate agents and get upset when they are educated on the importance of finding out how much home they can afford before getting out into the marketplace!  It’s important that a first time home buyer understands what the costs of buying a home are but also why they are involved.

Not only is it important for a first time home buyer to know how much they can afford, but it’s also important to understand the difference between a pre-qualification and a pre-approval.  
First and foremost, a pre-approval is more attractive to a seller than a pre-qualification.  A pre-qualification is a quick and very general overview of a first time buyers financial situation.  The information used for a pre-qualification is usually given to the lender by the potential mortgagee, which can often be inaccurate.  In addition to the general overview of the first time buyers financials, the lender usually will pull a credit report to make sure the credit scores are within the required guidelines of the different loan programs.
A pre-approval is a detailed look into a first time buyers financials.  It includes a lender pulling a fact data (Tri-merge) credit report, collecting the first time buyers pay stubs,  W-2’s, verifying their employment, and any other information needed to approve the buyer.  This process may sound much more difficult, but depending on the lender that a first time buyer chooses, it doesn’t have to be!  Having a pre-approval instead of a pre-qualfication is not only attractive to a seller, but also can be the difference in a first time buyer winning in a multiple offer situation!

Set Your Expectations

When buying a home for the first time, an extremely important tip is to make sure expectations are set.  By setting realistic expectations, the chance to be disappointed or let down is minimized.  So, what type of expectations should be set before purchasing a home for the first time?

Once a buyer knows how much they can afford, it’s important to figure out what will their money get them.  When buying a home for the first time, it’s important to do it with a purpose and a realistic goal in mind.  How big of a home can be afforded?  What style of home is desired?  What are acceptable locations of the home?  It’s important that first time buyers have a strong feeling on items like these but also a good idea on which items they are willing to be flexible with.  It is a great idea to prioritize these items in order of importance.
Buying a home with no expectations or goals in mind is no different than going to a grocery store with no list or budget.  By going to a grocery store with no idea what will be purchased often will end up in lots of wasted time walking around aimlessly and ultimately not getting the results that would be expected.  By having that strong grasp on the style of home, the size of a home, and other characteristics that are desired in a home will save a first time buyer lots of time and also ensure they are purchasing their first home while staying within the range of what they are able to realistically afford.  It makes no sense for a buyer who is pre-approved for a loan amount of $150,000 to look at local luxury homes.  A great real estate agent should be able to help a buyer set realistic expectations.

Learn About the Home Buying Process

The home buying process is exactly that, a process.  There are certain steps that need to be taken to ensure the process of buying a home for the first time, goes smooth.  By understanding the process, it greatly reduces the chance that a buyer is disappointed, let down, heartbroken, or frustrated.  There are many things that a first time buyer should be doing before looking for homes, such as getting a pre-approval, but also many things that a buyer should be doing once they are under contract on their future home.  Many first time home buyers don’t understand why it generally takes 60 days from contract to closing.

Get Educated on the Local Real Estate Market

When purchasing a home for the first time, it’s important a buyer understands the local real estate market.  There are many ways this can be accomplished.  The internet has completely changed the way the real estate industry works in 2017!  There is so much information available on the internet that can certainly help a buyer understand the local real estate market.  The internet is great for providing a wealth of information, however, it’s also important a buyer understands that not everything that is on the internet is true.  Really it isn’t!  There are many third-party real estate websites on the internet that provide some very inaccurate information.  A perfect example of inaccurate real estate information are the “Zestimates” that Zillow provides to consumers.  The inaccurate information provided by these third-party real estate websites is not only specific to the Houston, TX real estate market.

The best place for a first time home buyer to get educated on the local real estate market is by a local real estate professional.  If someone was looking to have a dental procedure done, they wouldn’t go on the internet to look how to do the procedure or call their chiropractor.  They would call a local dentist for their assistance.  A person in Houston, TX  who is in need of a dental procedure would have no use for a dentist in Lake Charles, LA.  The same can be said for a first time home buyer.  A first time home buyer in Lake Charles, LA should not be looking to a real estate agent for information on the Houston, TX real estate market.  It is important for a first time home buyer sit down with an experienced and knowledgeable local real estate agent to ensure they have a strong understanding of the local market!

Selecting a Real Estate Agent

Buying a home is a very large event in life.  It’s not something that should be done without the help of a trained real estate professional.  There are many things that a real estate agent is responsible to ensure are getting completed accurately and timely throughout the transaction.  Ensuring a buyer has secured a pre-approval from a reputable lender, ensuring contract dates are being followed, and negotiating on the buyers behalf to get them the best price for a home are just a few items that a buyers real estate agent is responsible for!  Without this guidance, it’s very easy for a first time buyer to make a mistake that can cost thousands of dollars.

There are many questions that a first time home buyer should ask a real estate agent, before selecting them!  It’s common and understandable that a first time home buyer has more questions than someone who has purchased 5 homes.  So, would it be a good idea for a first time home buyer to select a part-time real estate agent?  Probably not!  To be a successful real estate agent, there are many long days (and nights), which many times cannot be accommodated by a part-time real estate agent.  In addition to whether an agent is part-time or full-time, other great things to ask a real estate agent is; How many sales do you complete a year?  In what ways can/do you communicate?  Can you provide me with some references or testimonials?
There is often a general consensus that the real estate profession is one that can be done by anyone and that it’s “easy-money.”  This is very far from the truth.  There are people entering and exiting the real estate profession on a daily basis.  This is why it’s extremely important that a first time buyer asks any potential agent that they are thinking of selecting these difficult questions.

Are There Any Incentives or Grants Available

First time home buyers are often able to take advantage of first time home buyer grants or incentives.  It’s important that a first time buyer understands that every lender is different.  From the interest rate they are able to offer, the type of loan products they offer, to the incentives or grants they are able to offer.

A lender who may not offer a grant to first time home buyers, may never mention it.  When selecting a lender, it’s a good idea for a first time home buyer to research all of their options.  It sometimes is a good idea to reach out to a local real estate professional before locking into a local mortgage lender.  A great real estate professional should be able to understand a first time buyers situation and be able to suggest reputable companies who may offer the best type of product and/or grant for that buyer.

Consider All Expenses Involved in Owning a Home
Many first time home buyers make the mistake of not considering the costs of owning a home.  It’s common that a first time buyer purchases a home that is the absolute maximum they can afford according to a lender.  This can lead to problems once the buyer realizes the other expenses involved in owning a home.  First time home buyers often forget about additional expenses of utilities, furniture, appliances, insurance, and groceries, to mention only a few.

A first time buyer who doesn’t consider these additional expenses often will have to change their lifestyles, which can be difficult for some.  Instead of living with mom and dad who had cable TV and high-speed internet, they may now have to live without these luxuries.  Bottom line, a first time home buyer must consider all the expenses and possible changes to their current lifestyle that may occur once owning a home!

The above advice and tips are extremely important to a first time home buyer.  By understanding these tips, it can make the process not seem as “daunting” or difficult!  A first time buyer needs to understand and feel comfortable with the professionals they are working with that “no question is a dumb question!”  

About the authors: The above article “First Time Home Buyer Tips and Advice” was written by Andres Jones of the The Jones Team at Realm Real Estate Professionals. With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise.

We service the following Greater Houston areas: Sugar Land, Missouri City, Katy, Cypress, Pearland, Spring, Stafford, Richmond, Rosenberg, Fulshear, Woodlands, Conroe, Humble, Kingwood, Crosby, Baytown, Beaumont, and Galveston, TX