Top things to know when looking for a home

Tania Kegyes, 2011 President, Lorain County Association of REALTORS®

Tania Kegyes 2011 LoCAR President

Members of the Lorain County Association of REALTORS® are committed to helping buyers and sellers understand the home buying and selling process.

Here are a few things to keep in mind.

Contact a REALTOR®.
Even though the Internet gives buyers unprecedented access to home listings, studies show that most new buyers (and many more experienced ones) are better off using a REALTOR®.

Check your credit.
Since you most likely will need to get a mortgage to buy a house, you must make sure your credit history is as clean as possible. A few months before you start house hunting, get copies of your credit report. Make sure the facts are correct and fix any problems you discover. Making an appointment with your lender will be a way to expedite what needs to be done to meet lending criteria as well.

Get pre-approved.
Getting pre-approved will you save yourself the grief of looking at houses you can't afford and put you in a better position to make a serious offer when you do find the right house. The short sale, bank owned home reps and most sellers will not even look at your contract without a preapproval or minimally a prequalification letter. Pre-qualification, which is based on a cursory review of your finances, pre-approval from a lender is based on your actual income, debt and credit history (that has all been documented and verified). This step is a must do!

Aim for a home you can really afford.
The rule of thumb is that you can buy housing that runs about two-and-one-half times your annual salary. But you'll do better to use one of many calculators available online to get a better handle on how your income, debts and expenses affect what you can afford. Calculators are good for a general idea, but due to credit score influences, payment history, work history etc. and changes in lending requirements that may occur frequently, it is still more accurate to actually work with a lender. If you can't put down the aspirational 20 percent, you may still qualify for a loan with less down payment. There are a variety of public and private lenders who, if you qualify, offer low-interest mortgages that require a down payment as small as 3.5 percent of the purchase price. Veterans can buy with no money down! Doesn't matter if you have used it in the past, as long as the loan was paid off or a qualified Veteran assumed your mortgage!

Choose carefully between points and rate.
When picking a mortgage, you usually have the option of paying additional points--a portion of the interest that you pay at closing--in exchange for a lower interest rate. If you stay in the house for a long time--say three-to-five years or more--it's usually a better deal to take the points. The lower interest rate will save you more in the long run. Interest rates are incredibly low even if you do not buy down the rate, so do not wait. Interest rate increases decrease affordability for the first time or one income buyer the most. Today's interest rates give a buyer incredible buying ability so do not wait and be part of the "would of, should of club."

Do your homework before making an offer.
Your opening bid should be based on the sales trend of similar homes in the neighborhood. So before making it, consider sales of similar homes in the last three months. Working with your agent, you will be able to research history as well.

Hire a home inspector.
Sure, your lender will require a home appraisal anyway, but that's just the bank's way of determining whether the house is worth the price you've agreed to pay. Separately, you should hire your own home inspector, preferably someone who is an ASHI member (home inspectors are currently not licensed in Ohio, but belonging to the American Society of Home Inspectors has requirements and a code of ethics). His or her job will be to point out potential problems that could require costly repairs down the road as well as maintenance ideas. Remember that no house is perfect, but you are able to plan for items accordingly and likely know the home better than the owner!

Whether you need resources on certain school districts, financing and the buying process, or making that offer, REALTORS® work daily with buyers and sellers in helping them to achieve the dream of homeownership. Contact a REALTOR® today.

Buying a home can be one of life's most exciting experiences - and one of the most challenging. The more prepared you are at the outset, the less overwhelming and chaotic the process will be. Be sure to utilize the services of a professional -- a REALTOR® -- who can help guide you through the home buying and selling process. A REALTOR® with your local Lorain County Association of REALTORS® is trained to help you make your housing dreams become a reality.

The Lorain County Association of REALTORS® is one of more than 1,200 local boards and associations of REALTORS® nationwide that comprise the National Association of REALTORS®. The National Association of Realtors®, "The Voice for Real Estate," is America's largest trade association, representing more than one million members involved in all aspects of the residential and commercial real estate industries.

The Lorain County Association of REALTORS® offers a website that provides a complete listing of REALTOR® and industry Affiliate members (such as title companies, banks, home inspectors, etc.). If you are a first time homebuyer or a repeat buyer consider www.MyNewCommunity.net or www.LoCAR.org as a good source for information.

REALTOR® is a registered collective membership mark which may be used only by real estate professionals who are members of the National Association of REALTORS® and subscribe to its strict Code of Ethics. Not all real estate sales agents are REALTORS®. All REALTORS® are members of NAR along with their State and Local Associations.