Wilmington and Burgaw Area Real Estate News

1. First determine if you can afford to buy a home.  A monthly house payment should be no more than 25-30% of your monthly income. Anything more than that will not leave enough money for other bills and unexpected expenses. It is important to realize that you need to include the cost of taxes, homeowner’s insurance, utilities, and garbage into your monthly housing cost. If you aren’t prepared, you may end-up “house poor”.

2. If you have determined you can afford to buy a home, contact a couple mortgage lenders for quotes and programs. When it comes to your mortgage you may be surprised at the different loan types and payment options available to you. It can be baffling when you think about ARMS and PMI. Usually a fixed rate fifteen or twenty year loan is the best option. This can help you lock in a low rate. You may be considering creative financing to cover the down payment, but you should be careful when you make these choices. You want to build wealth with your home purchase.

Once you find a mortgage lender with a suitable quote, get a preapproval letter from them. This will tell you exactly what you can afford and will make your home search much easier. Also, some sellers will not accept an offer without a preapproval letter.

3. Hire a Realtor. A Realtor works to help you narrow down your home search in a market overflowing with options. They have the experience needed to properly negotiate a purchase contract and represent your best interests. It’s a common misconception that the home buyer pays a Realtor to represent them. In reality, it’s the seller who pays the commission for both the listing and buying agents. So, there is not out-of-pocket expense.

4. Be prepared to pay a 15% downpayment and all of your closing costs out of pocket. This will save you money over time by eliminating the interest that would accrue on that money if it was included as part of a loan. If you are finding it difficult to save up for closing costs you may not be ready to purchase a home.

5. Get a home inspection. This should be a requirement. It will cost a few hundred dollars, but a well-educated engineer will catch structural flaws that will save you thousands later on.

6. When you’re ready to move into your new home, transfer as many services as you can. Many companies will wave installation and setup fees if you’re just transferring their services to a new property. This can save you a few hundred dollars.