Katherine Braden R PB

#5 Not understanding more than P&I of a mortgage so you buy too much house.

In number four you can kill the deal, but there are several ways while buying a house, you can kill your credit. Maybe not right away, but soon enough. Those little mortgage calculaters on all those sites calculate what your monthly payment would be for a loan amount at a certain rate of interest. Just the P&I - the principal (the amount you borrowed) and the interest you owe (on the amount you borrowed)

So the calculater tells you you can afford a $500,000 loan at 3.99 interest. Whoo!!! but whoa. Along with P&I is basic utilities, homeowners insurance, property taxes and in some places, other fees. You'll need those estimates too. And can you get a 3.99 interest loan? Or do other things such as the available cash for the deal not leave you enough to get that rate? Plus there are costs to completing a purchase. The costs are usually spelled out on the initial estimate along with estimated taxes, P&I, and other fees, but you'd have to go get estimates for insurance.

So you've talked to a lender and given him your information (yes you pulled together actual paperwork so he can tell you for real what is possible) and he's told you the most you have to work with. But just because you can, doesn't mean you should. In addition, to complete the deal are you tapping every bit of cash reserves you have? That can leave you mighty venerable in this uncertain world. If every dime of your income is going to pay for your home (P&I, Insurance, Taxes, Fees, and basic utilities) then you are going to start to feel pressured, and should the smallest thing happens ( the extra pay you were getting is cancelled, you got an early transfer, the water heater broke, the baby got sick, life), you my friend are up the creek without a paddle. You'd end up starting on that deadly credit spiral downward killing your credit just to survive.

The investment in a home is the best longterm investment you can make. It has been proven over and over, homeownership is the best way to build wealth and provide security for your family. But let's be wise buyers and make sure it is a financial decision not an emotional one. Carefully assess your monthly income and deduct those expenses that are necessary to the family's well-being, as well as the basics you have to pay out each month. You don't need to eat out every night, but an occasional movie and a hamburger is ok. Determine the price range of the home you can afford - not the home that you could buy.

Plan ahead for unexpected salary changes or job transfers - some things we can't control but we can be prepared for. Make sure your home is in a good area for quick rentals at prices that will cover most or all of your costs. That way you can always rent it out until the market is at a place where you can sell and take your equity to your next home investment.

So let's skip that home you could buy and look for that home you should buy in Aiea, Diamond Head, Ewa Beach, Haleiwa,Hauula, Hawaii Kai,Honolulu, Kaaawa, Kahuku, Kailua, Kaneohe, Kapolei, Laie, Lanikai, Mililani, Pearl City,Wahiawa, Waialae Iki, Waialua, Waianae, Waikiki, Waimanalo, Waipahu.

#4. Messing with your credit, killing the deal.

You've gone to all the trouble to get a good mortgage quote and get preapproved, you've found the house and had your offer accepted, and you are in escrow. Your mortgage officer and Realtor told you not to spend anything on anything until the deal closes. But you are just so happy and that living room set would be so perfect with the new big screen TV. You've possibly just cancelled the deal on your house. Loan officers have to pull your credit again as part of the final loan letter due right before closing to make sure that your financial situation hasn't changed since the loan received conditional loan approval. Unless you are very low on your debt to income ratio, the loan may be cancelled and it will be too late to get another. DON'T SPEND ANYTHING ON ANYTHING, CREDIT OR CASH that is more than what you were spending the day you got your loan.

GOt that loan approved? Let's look at some homes in Aiea, Diamond Head, Ewa Beach, Haleiwa,Hauula, Hawaii Kai,Honolulu, Kaaawa, Kahuku, Kailua, Kaneohe, Kapolei, Laie, Lanikai, Mililani, Pearl City,Wahiawa, Waialae Iki, Waialua, Waianae, Waikiki, Waimanalo, Waipahu.

#3 Not getting a local loan approval. You should shop for your mortgage of course. But one of your estimates should be a local loan officer's pre-approval. Yes, it's a pain to get all those docs together, but you are going to need to do it anyway. And why local? Hawaii has very unique land laws and condominium laws that even USAA doesn't understand.

Do you know which condominium's apartments are too small to get conventional loans on? Do you know how that fence on the property affects the title and whether the loan officer can get a VA loan on that renovated lanai or do you have to tear it down?

I have had great quotes at low rates from internet/mainland mortgage companies right up to conditional approval of the loan (that's about three-quarter's of the way through the escrow towards closing the sale) when the loan originator will suddenly say, oh we didn't know that condition was there - we can't loan on that. If you have a local loan officer already having pre-approved the loan on that home; they can pick up the ball when mainland cheap quote drops it.

Sellers and I place higher value on a pre-approval, especially from a local loan company that we can check on. So give me a call and I'll hook you up with our loan partner and let's see what you have to work with and let's go shopping for your new home in paradise like these in Aiea, Diamond Head, Ewa Beach, Haleiwa, Hauula, Hawaii Kai,Honolulu, Kaaawa, Kahuku, Kailua, Kaneohe, Kapolei, Laie, Lanikai, Mililani, Pearl City, Wahiawa, Waialae Iki, Waialua, Waianae, Waikiki, Waimanalo, Waipahu.

#2 Not getting your own agent and committing to them. Preferably one that primarily represents buyers or has been accredited as a Buyer's Agent.

There are two or three subtopics here. First is the buyer who thinks they'll save money by just walking into the listing they are interested in and talking to the agent there to make an offer. That agent represents the Seller. Without getting too much into agency, the listing agreement signed by the Seller is with the Brokerage, so the listing agent and any other agent in that brokerage owes their fiduciary duty and full loyalty to the seller - it's called being a client.

The minute the agent says they will help you write an offer on that house or anything to do with that house, you are now in a dual agency situation - you are now a customer and so is the seller and the agent can only process the offer for you and present it to the listing agent and the listing agent can present it to the seller. No negotiation - no advice. She can answer your questions regarding the market, like homes and such, but only if you know the right questions to ask.

You have given away the best reasons for having an agent represent you, the knowledge and skill needed to get the sale from offer to closing, protecting your interests above all others. Especially if you are new to the Islands; how do you know what to offer? The listing price? What is the neighborhood like, what's the resale value, what are the trends? What are the best forms and how to fill them out - what are the contingencies, liabilities, and processes?

This also answers the buyer who wants to buy a home without an agent - even if the seller is selling without one - now you've got double jeopardy and somewhere in here, very expensive (and in Hawaii, usually not part of the residential real estate transaction) lawyers will need to be consulted in areas where they are not experts - writing up a contract is the simplist thing the agent does for you.And what escrow company are you going to use? Home Inspector? Termite Company? Where do you get Condo Docs? Subdivision Docs? Building permit packages?

Don't get me started on the rant of data vs. information. Of course, all the data and charts are on the internet and you can gather all that data yourself. You can get it right off our own website, even comparison data from the house you are viewing. But do you have the knowledge and experience to turn that data into information on which you can base an informed decision?

And you don't save any money. The seller pays the agents' commissions based on the listing agreement with the seller's agent's brokerage and the seller decides how much of that commission shall be offered to the buyer's agent for cooperating in the sale by managing the buyer half of the transaction. If you came in without an agent at all, the Seller may still have to pay the full commission to the Seller's agent - would you trust that agent to protect you? The only buyer that has to pay any commission is the buyer who picked an agent to represent them who states that they expect the buyer to make up the difference between what the seller is offering and what the Buyer's agent expects to receive. But you did your research and picked the agent that will best protect you and meet your needs didn't you?

The agent that mostly represents buyers is what you are looking for. They have all the information and expertise from the buyers perspective. If you are using several agents and going with the one who "finds the house" , you are doing yourself another disservice. Using an agent that is not a Realtor ( a member of the National and local Board of Realtors) can also be a disadvantage.

All Realtors have the same information on each island in Hawaii. We are all subject to the same rules and we all have the same market information and access to properties currently listed. What you should be looking for is the agent that best can represent you, listens to your needs and wants, and then has the experience to advise you on the best solutions. Even if a friend is recommending an agent to you, this is a business deal not an introduction to your new BFF; get references, interview the agent, see if you have rapport with the agent and if they fit your style. And then commit to them, so they can work for you. See the #1 Mistake, and after you get pre-approved with a local lender and sign my Buyer's Representation Form committing to our exceptional services, I'll get busy finding and helping to secure your piece of paradise like these in Aiea, Diamond Head, Ewa Beach, Haleiwa, Hauula, Hawaii Kai,Honolulu, Kaaawa, Kahuku, Kailua, Kaneohe, Kapolei, Laie, Lanikai, Mililani, Pearl City, Wahiawa, Waialae Iki, Waialua, Waianae, Waikiki, Waimanalo, Waipahu.

#1. Picking the home/area/whatever before you get pre-qualified. Actually, to be safe you want to get pre-approved.

Don't you just love watching those real estate shows on TV? Well, me too, especially the international ones! The firsttime buyer show doesn't quite match the way we do things in Honolulu and Hawaii in general, but that's real estate; local,local,local. One of the things that they do correctly, that you may feel is cruel, is to show a house that meets all the desires of the buyer and then let's them know the price - usually way out of their budget.

Many first time buyers start looking at houses way before they even know what their budget is. If you are looking to familiarize yourself with the areas in the place you are moving to or to find out what price ranges are - great. It's key to understand neighborhoods and schools close to where you are moving; but don't pick the house first and then try and get a loan.

A home purchase is probably the largest investment you will make in your life, so don't you want to make the best purchase you can? That means knowing what you have to work with.

A pre-approval by a lender is based on what you say you earn and spend; a pre-approval requires actual documentation so the lender can give you a better idea of down payment required, if mortgage insurance is required, points for rate information, and finally, exactly what you have to work with.

Now we can start to map out areas and home criteria that meet your budget. Give me a call 808-265-6803, and let the showings begin and let's find you your piece of paradise in Aiea, Diamond Head, Ewa Beach, Haleiwa, Hauula, Hawaii Kai,Honolulu, Kaaawa, Kahuku, Kailua, Kaneohe, Kapolei, Laie, Lanikai, Mililani, Pearl City, Wahiawa, Waialae Iki, Waialua, Waianae, Waikiki, Waimanalo, Waipahu