Buying your first home

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Buying your first home

• Tom and Ivy Davey
• Ruhl and Ruhl Realtors

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Why buy a home?

• Income tax advantages
• Investment
• Stability

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Path to buying a home

• Clean your credit report
• Find a buyer's RE agent with whom youre
  comfortable
• Determine how much house you can afford
• Secure financing and qualify for your mortgage

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Path to buying a home (cont)

• Be a tough negotiator
• Be willing to walk away
• Have the house inspected by a professional
  inspector
• If inspection and financing are OK, dont get
  cold feet

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How to Home search

• RE agent
• On-line
• FSBO
• Classified
• Word of mouth

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Hints

• Buy a book on Home buying
• Don't be in a rush
• Know the best time to buy a home
• Be comfortable with your RE agent, your mortgage
  person

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Houses you may want to avoid

• Adjacent to shopping center
• Adjacent to traffic
• Houses with a flat roof (addition)
• Most expensive house on the street
• Next door to a renter
• Noisy area (airport, industrial)

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Houses to avoid (cont)

• Crime area
• Flood zone (check it out in the rain)
• One bathroom
• No neighborhood code enforcement
• On a steep hill

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Houses to avoid (cont)

• Home hard to sell (2 bed, 1 bath vs. 3 bed, 2
  bath or single car garage)
• Tiny master bedroom or small closets
• Close to landfill, water treatment, pig farm
• Main road
• Undesirable school district
• (Hint Talk to the neighbors)

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Houses you may want to buy

• Least expensive house in upscale neighborhood
• On a golf course (some love it, some don't)
• End of the block or a cul de sac
• Adjacent to land zoned residential, or forest
  preserve
• Good schools

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Houses to buy (cont)

• Reasonably close to shopping, work, grocery store
• No traffic or logistics getting in or out of your
  street
• High ceilings, large kitchen, walk in closets
  (resale)
• 2 car garage (3 is preferable)
• Energy efficient

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Negotiating tips

• Sellers agent wants to convince you house is
  worth the price
• You and your agent want to convince them otherwise

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Negotiating tricks and tactics

• "Do you really want to accept another offer from
  another buyer?"
• "If the house is such a good deal, why hasn't it
  sold yet?"
• The listing agent says, "This house appraised for
  225,000."
• So what? The value of the house is what you they
  buyer are willing to pay.
• Nit pick
• You are not going to pay for the seller's
  mistakes (maybe they paid too much.)

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Making the offer

• Back it up with 1,000 earnest money check
• Have your valid mortgage credit approval letter
  from your lender
• Put in some "outs"
• financing
• termites
• bad title
• undisclosed liens
• bad inspection

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Home Financing Calculators

• How much can I borrow?
• How much will my mortgage payments be?
• How much will my adjustable rate payments be?
• Which is better fixed or adjustable?
• Should I pay points to lower the rate?
• Which is better 15- or 30-year loan term?

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Home Financing Calculators (continued)

• How much should I put down for a new home?
• How much can I save in taxes?
• What will my closing costs be?
• Am I better off renting?
• Am I better off refinancing?   
• What home can I afford

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Buying your first home (summary)

• Clean your credit
• Know how much you can afford qualify
• Take your time
• Research (know what you want)
• Get a good agent
• Search the internet, have your agent look, check
  the classifieds

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Buying your first home (summary continued)

• Find your home
• Make an informed offer
• Home inspection
• Enjoy your new home

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Questions?